How to Raise a University’s Profile: Pricing and Packaging

How to Raise a University’s Profile: Pricing and Packaging

By KEVIN CAREYFEB. 6, 2015

Photo

George Washington’s University Yard resonates with the iconography of a classic quad, scrunched onto an urban campus. CreditMary F. Calvert for The New York Times


Jb 9 February 2015

Everyone in America needs to stop and read this article. It's all a ripoff. It's all one big ripoff. That former University president should...
Tom Leykis Fan 9 February 2015

GW has *never* been a commuter school and calling it one brings one to question the rest of the author's piece. Does he know anyone who...
Maddy D 9 February 2015

Odd timing for this article to come out just days after GW was ranked #1 among all universities in the nation for internship opportunities....
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One day in 2013, I sat down in a Starbucks in the Foggy Bottom neighborhood of Washington with Hugh Moren, then a junior at the nearby George Washington University. I asked him how much money he was borrowing to go to college.

“Eighty-two thousand dollars,” he said. “By the time I graduate, a hundred ten.”

The number shocked me, but not as much as the way it didn’t shock him.

Hugh Moren was born in Warwick, R.I., and like generations of smart young people raised in the country’s decaying industrial towns, he spent his adolescence plotting to leave. He wanted to study international relations and get a degree from a university with a good reputation. But his family didn’t have any money, and tuition, fees and room and board at George Washington ran almost $60,000 a year. So he borrowed as much as the federal government would lend him and went to private lenders like Sallie Mae to borrow more.


He had plans and aspirations: a job with a Swiss company that organizes international science conferences, then the Foreign Service exam and, he hoped, a life in diplomacy overseas.Photo

“I was given an institution and told, ‘Make this place better, and by the way, be embarrassed that you’re not Georgetown,’” says Stephen Joel Trachtenberg, former president of the George Washington University. CreditRichard A. Bloom

Yet I don’t think he entirely understood what it meant to have a six-figure indenture hanging around his neck when he was 21 years old. He assumed everything would work out. Hadn’t it worked out for all the people who had taken his path before?

We got up and walked across Pennsylvania Avenue onto campus. I knew the university by reputation: an up-and-coming school that had become more exclusive and expensive over time, the home to many respected scholars and a student body that was, if not quite the caliber of nearby Georgetown University, nationally competitive.

As we entered the grounds, the iconography resonated deeply, evoking memories of my own college experience. The campus library stood to the right, and beyond that a basketball arena, food court and bookstore. Someone had pasted Greek letters on the inside of a dormitory window. There were bronze statues. Pathways crisscrossed University Yard, like any classic quad. But instead of being in the middle of campus, it was stuck off to the side, with light foot traffic. This seemed less a campus than a collection of university-like structures scrunched together in an area two sizes too small. Construction cranes promised newer buildings to come.

I talked to a half-dozen of Hugh Moren’s fellow students. A highly indebted senior who was terrified of the weak job market described George Washington, where he had invested considerable time getting and doing internships, as “the world’s most expensive trade school.” Another mentioned the abundance of rich students whose parents were giving them a fancy-sounding diploma the way they might a new car. There are serious students here, he acknowledged, but: “You can go to G.W. and essentially buy a degree.”

I went on the university’s website to look for some kind of data or study indicating how much students at George Washington were actually learning. There was none. This is not unusual, it turns out. Colleges and universities rarely, if ever, gather and publish information about how much undergraduates learn during their academic careers.
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Colleges may be afraid of what they would find. A recent studyfrom the Organization for Economic Cooperation and Development found that, on average, American college graduates score well below college graduates from most other industrialized countries in mathematics. In literacy (“understanding, evaluating, using and engaging with written text”), scores are just average. This comes on the heels of Richard Arum and Josipa Roksa’s “Academically Adrift,” a study that found “limited or no learning” among many college students.

Instead of focusing on undergraduate learning, numerous colleges have been engaged in the kind of building spree I saw at George Washington. Recreation centers with world-class workout facilities and lazy rivers rise out of construction pits even as students and parents are handed staggeringly large tuition bills. Colleges compete to hire famous professors even as undergraduates wander through academic programs that often lack rigor or coherence. Campuses vie to become the next Harvard — or at least the next George Washington — while ignoring the growing cost and suspect quality of undergraduate education.

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The man who made the George Washington University what it is today sits in the corner office of a building with his name on the entrance — the Trachtenberg School of Public Policy and Public Administration, where he now teaches — a few blocks away from University Yard.

The university was an inexpensive commuter school when Stephen Joel Trachtenberg became president in 1988. By the time he was finished, two decades later, it had been transformed into a nationally recognized research university, with expanded facilities and five new schools specializing in public health, public policy, political management, media and public affairs and professional studies.

U.S. News & World Report now ranks the university at No. 54 nationwide, just outside the “first tier.”

It was no secret where the money had come from to pay for it all: the students and their families. Under Mr. Trachtenberg’s leadership, tuition grew until George Washington was, for a time, the most expensive university in America.

Mr. Trachtenberg was raised in a working-class Brooklyn neighborhood before attending Columbia University, Yale Law School and Harvard’s Kennedy School of Government. After a stint working for the United States commissioner of education, he was hired as a senior administrator at Boston University; soon after, in 1971, John R. Silber was hired as president.

By then, the American research university had evolved into a complicated and somewhat peculiar organization. It was built to be all things to all people: to teach undergraduates, produce knowledge, socialize young men and women, train workers for jobs, anchor local economies, even put on weekend sports events. And excellence was defined by similarity to old, elite institutions. Universities were judged by the quality of their scholars, the size of their endowments, the beauty of their buildings and the test scores of their incoming students.
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That created an opening for those who wanted to mimic the established schools. Buildings and scholars could be bought, and as long as the students were relatively smart when they enrolled, few questions would be asked about what they learned in college itself. Indeed, because the standard university organizational model left teaching responsibilities to autonomous academic departments and individual faculty members, each of which taught and tested in its own way, few questions could be asked that would produce comparable results.

So John Silber embarked on a huge building campaign while bringing luminaries like Saul Bellow and Elie Wiesel on board to teach and lend their prestige to the B.U. name, creating a bigger, more famous and much more costly institution. He had helped write a game plan for the aspiring college president.


Mr. Trachtenberg absorbed those lessons well. “I learned my craft from John Silber,” he told me. Other universities were eager to hire administrators who could help them climb the ranks of higher-education fame and fortune. The University of Hartford came calling, and in 1977 Mr. Trachtenberg became its president. He spent 11 years there, always building.

Mr. Trachtenberg understood the centrality of the university as a physical place. New structures were a visceral sign of progress. They told visitors, donors and civic leaders that the institution was, like beams and scaffolding rising from the earth, ascending. He added new programs, recruited more students, and followed the dictate of constant expansion.

The George Washington University came with some assets, most importantly a prime location just a few blocks from the White House, but it had little money and suffered from an inferiority complex. “I was given an institution and told, ‘Make this place better,’ ” Mr. Trachtenberg said, “ ‘and by the way, be embarrassed that you’re not Georgetown.’ ”

Everyone wanted something from him: better facilities, better colleagues, better students — and all of those things cost money. He had no base of rich alumni like the Ivies or Georgetown did. Fund-raising was a chicken-and-egg problem: Rich people wanted to support something that was already excellent, but excellence as they understood it required millions of dollars to buy.

Mr. Trachtenberg, however, understood something crucial about the modern university. It had come to inhabit a market for luxury goods. People don’t buy Gucci bags merely for their beauty and functionality. They buy them because other people will know they can afford the price of purchase. The great virtue of a luxury good, from the manufacturer’s standpoint, isn’t just that people will pay extra money for the feeling associated with a name brand. It’s that the high price is, in and of itself, a crucial part of what people are buying.


Mr. Trachtenberg convinced people that George Washington was worth a lot more money by charging a lot more money. Unlike most college presidents, he was surprisingly candid about his strategy. College is like vodka, he liked to explain. Vodka is by definition a flavorless beverage. It all tastes the same. But people will spend $30 for a bottle of Absolut because of the brand. A Timex watch costs $20, a Rolex $10,000. They both tell the same time.


The Absolut Rolex plan worked. The number of applicants surged from some 6,000 to 20,000, the average SAT score of students rose by nearly 200 points, and the endowment jumped from $200 million to almost $1 billion.

It wasn’t easy, because the schools it was competing with in the national market for students, scholars and money weren’t standing still. “We built a new building, they built two new buildings,” he said. “That’s what was going on all the time.”

He looked for opportunities to paint the luxury school picture. He built Ivory Tower, a residence hall of one- and two-bedroom suites complete with living room, kitchen and private bathroom (featured last year on the College Finder website as one of the five best dorms in the United States). He expanded squash into a varsity sport, as it was at a small number of elite Northeastern campuses.

The university became a magnet for the children of new money who didn’t quite have the SATs or family connections required for admission to Stanford or Yale. It also aggressively recruited international students, rich families from Asia and the Middle East who believed, as nearly everyone did, that American universities were the best in the world.

Mr. Trachtenberg’s successor, Steven Knapp, is not one for liquor and watch metaphors. But the house that Stephen Joel Trachtenberg built remains.

Few students are poor enough to qualify for a federal Pell grant. In 2013, only 14 percent of the university’s 10,000 undergraduates received a grant — a figure on a par with elite schools but far below the national average. The average undergraduate borrower leaves with about $30,800 in debt.

The university is more expensive than ever, though it is no longer the most expensive university in America. It is the 46th.

Others have been implementing the Absolut Rolex Plan. John Sexton turned New York University into a global higher-education player by selling the dream of downtown living to students raised on “Sex and the City.” Northeastern followed Boston University up the ladder. Under Steven B. Sample, the University of Southern California became a U.S. News top-25 university. Washington University in St. Louis did the same.

And in hundreds of regional universities and community colleges, presidents and deans and department chairmen have watched this spectacle of ascension and said to themselves, “That could be me.” Agricultural schools and technical institutes are lobbying state legislatures for tuition increases and Ph.D. programs, fitness centers and arenas for sport. Presidents and boards are drawing up plans to raise tuition, recruit “better” students and add academic programs. They all want to go in one direction — up! — and they are all moving with a single vision of what they want to be. When research documenting the academic consequences of the status race is released, colleges generally try to change the subject.

Meanwhile, outstanding student loan debt now totals $1.2 trillion.

I asked Mr. Trachtenberg if it was morally defensible to let students borrow tens of thousands of dollars for a service that he himself had compared to a luxury good. He is not, by nature, one for apologies and second-guessing. “I’m not embarrassed by what we did,” he said. “It’s not as if it’s some kind of a bait and switch here. It’s not as if the faculty weren’t good. It’s not as if the opportunities to get a good degree weren’t there. There’s no misrepresentation here.” He seemed unbowed but also aware that his legacy was bound up in the larger dramas and crises of American higher education.

“I’m in favor of a perfect world,” he said. “I didn’t get to be a president in a perfect world. I got to be president in a world in which I was living.”

He had seen the university from the Olympian vantages of Cambridge, New Haven and Morningside Heights, watched it grow with students and federal money during the great mid-20th-century expansion and lived in the caldron of administrative ambition. And so he built the perfect representation of what, for good and for ill, American higher education has become.


This essay is adapted from “The End of College: Creating the Future of Learning and the University of Everywhere,” by Kevin Carey, to be published by Riverhead Books on March 3.

A version of this article appears in print on February 8, 2015, on page ED16 of Education Life with the headline: The Absolut Rolex Plan.