Have American Universities Lost Their Way?
Acting in Concert
Monday, October 16, 2017
Joel Phillips, Professor of Composition and Music Theory, Westminster Choir College
Have American universities lost their way? I believe they have. Ours in particular.
But on what basis can I make such a provocative statement? There are many reasons, but today I will focus on only one. It has to do with the fundamental nature of university business.
There are two types of enterprises—for-profit and not-for-profit. For-profits are owned and, as their name states, operated to benefit their owners and shareholders financially. For-profits pay taxes.
Not-for-profits are owned by no one. Let that sink in. No one owns this University. No one owns Westminster. There are no shareholders, only stakeholders—students, parents, alumni, faculty, staff, and friends.
Not-for-profits do not exist to produce financial benefit for any individual. Instead they create what is called a public good. Until recently it seemed obvious education was a public good. After all, education is the foundation of democracy and the basis for the prosperity and well being of a nation’s citizens. Society considers the idea of public good so significant not-for-profits are tax-exempt.
Not-for-profits cannot be bought or sold. Only their assets can. But President Dell’Omo put Westminster up for sale. So he must consider Westminster to be merely an asset.
And the president has found a buyer—a for-profit corporation, an entity that has no experience in higher education. The person responsible for the stewardship of our beloved College claims such an organization is well-positioned to lead Westminster into the future.
But we’re told the for-profit won’t run Westminster. The buyer will create a not-for-profit corporation, so everything’s cool, right?
Not if you read the news.
In recent years the for-profit education industry soared, but ran into difficulty once the public understood its tactics left hundreds of thousands of students with staggering debt and little to show for it. The government cracked down on the industry to such an extent, it began to develop a new strategy—conversion to not-for-profit. The most famous conversion to date is that of Keiser University.
In June 2017 David Halperin wrote: (in “Should This College Operator Run A Key Federal Oversight Panel”?)
In 2011, the Keiser family sold Keiser University for $521 million to a small non-profit organization, Everglades College, which the Keisers had created. In order to buy Keiser University, Everglades took on a $321 million loan — from Arthur Keiser. The non- profit he created is thus paying him principal and interest on that loan, plus an annual salary, as chancellor and CEO of Keiser University, of $831,000. Keiser also made Everglades a charitable gift of much of the rest of the purchase price, potentially providing him with large tax deductions.
In addition, Arthur Keiser owns stakes in properties that collect some $14.6 million in rent from Everglades, in the Holiday Inn where Everglades employees stay, in a private airplane that Everglades employees use, and in a computer company that contracts with the college.
Several board members of the non-profit Everglades also have had business deals with the school — for its filing system, for recruiting services, for the school’s pool maintenance program. The board chair...is the CEO of Best Roofing, which boasts on its website that it “assists [Keiser] University with all their roofing decisions,” and adds an endorsement from Art Keiser himself.
Arthur Keiser is the new chair of the U.S. Department of Education’s National Advisory Committee on Institutional Quality and Integrity — the group of experts charged with advising the Department on the performance of college accrediting organizations.
It seems an inappropriate conflict of interest for any current college operator, with a financial stake in a college, to sit as a member of the Department of Education committee that evaluates the fitness of accreditors, who in turn evaluate the fitness of the operator’s college. But it looks even worse, and it is even worse, if (1) the operator’s college has a troubling record; (2) the operator is awaiting a major ruling on its future from the Department of Education; and (3) the operator is elevated to chairman of the committee.
But surely our situation can’t be corrupt like that, can it? Isn’t it possible this really is a great opportunity for Westminster? We cannot know because the stakeholders in our not-for-profit have not been part of the decision-making.
On repeated occasions President Dell’Omo has regaled us in excited tones that this transaction is “virgin territory,” a “seminal” event unprecedented in higher education. Putting aside his language of exploitation, if it's unprecedented, then he is setting the precedent right? And Dell’Omo’s precedent has been to ignore the stakeholders. His precedent has been to make a personal decision with regard to the programs, lives, and culture of our institution. And he’s made this decision in the dark.
We are Westminster. And we deserve to be part of the decisions that affect our futures. Our voices deserve to be heard.
Dell’Omo’s mode of operation is common in the world of for-profits. And as the education “industry” becomes corporatized, we see less and less focus on public good and more emphasis on private good. Two years ago, when the president and provost fired tenured faculty and eliminated majors and minors that weren’t “profitable”—fine arts and philosophy, for example— these people were prepared to lead a University without art and philosophy. As shocking as that was, perhaps we shouldn’t have been surprised they would also try to get rid of us. In March the Rider SGA questioned the wisdom of this administration’s plan. “With this loss,” they wrote, “the University has identified retaining world-class artistic programs as the least of its priorities.”
Recently the provost claimed accounting was the University’s “best” program. Our accounting program is excellent I thought, but you mean after Westminster, right? No. The misunderstanding was mine. When the provost said “best,” she meant “most profitable.” The University makes more money per capita on accounting majors than on any other program. The University’s academic leader equated “best” with “profitable”—not with the program that produces the greatest public good.
But we are Westminster—the program that creates the greatest public good. We develop the world’s musical leaders. Every day our graduates demonstrate their leadership in schools, places of worship, concert halls, their communities, private lessons, and through acts of creation. Their actions enrich the lives of millions of people worldwide. But our graduates know that leadership is not simply the assertion of one’s authority. It isn't something that flows down from a “superior” to subordinates. True leaders recognize that leadership is a form of service. Leadership is not about standing above, but alongside.
Our leaders have lost their way. But Westminster has not. Today we stand alongside one another, ready to lead.
We are Westminster. Hear our voices.
Acting in Concert
Monday, October 16, 2017
Joel Phillips, Professor of Composition and Music Theory, Westminster Choir College
Have American universities lost their way? I believe they have. Ours in particular.
But on what basis can I make such a provocative statement? There are many reasons, but today I will focus on only one. It has to do with the fundamental nature of university business.
There are two types of enterprises—for-profit and not-for-profit. For-profits are owned and, as their name states, operated to benefit their owners and shareholders financially. For-profits pay taxes.
Not-for-profits are owned by no one. Let that sink in. No one owns this University. No one owns Westminster. There are no shareholders, only stakeholders—students, parents, alumni, faculty, staff, and friends.
Not-for-profits do not exist to produce financial benefit for any individual. Instead they create what is called a public good. Until recently it seemed obvious education was a public good. After all, education is the foundation of democracy and the basis for the prosperity and well being of a nation’s citizens. Society considers the idea of public good so significant not-for-profits are tax-exempt.
Not-for-profits cannot be bought or sold. Only their assets can. But President Dell’Omo put Westminster up for sale. So he must consider Westminster to be merely an asset.
And the president has found a buyer—a for-profit corporation, an entity that has no experience in higher education. The person responsible for the stewardship of our beloved College claims such an organization is well-positioned to lead Westminster into the future.
But we’re told the for-profit won’t run Westminster. The buyer will create a not-for-profit corporation, so everything’s cool, right?
Not if you read the news.
In recent years the for-profit education industry soared, but ran into difficulty once the public understood its tactics left hundreds of thousands of students with staggering debt and little to show for it. The government cracked down on the industry to such an extent, it began to develop a new strategy—conversion to not-for-profit. The most famous conversion to date is that of Keiser University.
In June 2017 David Halperin wrote: (in “Should This College Operator Run A Key Federal Oversight Panel”?)
In 2011, the Keiser family sold Keiser University for $521 million to a small non-profit organization, Everglades College, which the Keisers had created. In order to buy Keiser University, Everglades took on a $321 million loan — from Arthur Keiser. The non- profit he created is thus paying him principal and interest on that loan, plus an annual salary, as chancellor and CEO of Keiser University, of $831,000. Keiser also made Everglades a charitable gift of much of the rest of the purchase price, potentially providing him with large tax deductions.
In addition, Arthur Keiser owns stakes in properties that collect some $14.6 million in rent from Everglades, in the Holiday Inn where Everglades employees stay, in a private airplane that Everglades employees use, and in a computer company that contracts with the college.
Several board members of the non-profit Everglades also have had business deals with the school — for its filing system, for recruiting services, for the school’s pool maintenance program. The board chair...is the CEO of Best Roofing, which boasts on its website that it “assists [Keiser] University with all their roofing decisions,” and adds an endorsement from Art Keiser himself.
Arthur Keiser is the new chair of the U.S. Department of Education’s National Advisory Committee on Institutional Quality and Integrity — the group of experts charged with advising the Department on the performance of college accrediting organizations.
It seems an inappropriate conflict of interest for any current college operator, with a financial stake in a college, to sit as a member of the Department of Education committee that evaluates the fitness of accreditors, who in turn evaluate the fitness of the operator’s college. But it looks even worse, and it is even worse, if (1) the operator’s college has a troubling record; (2) the operator is awaiting a major ruling on its future from the Department of Education; and (3) the operator is elevated to chairman of the committee.
But surely our situation can’t be corrupt like that, can it? Isn’t it possible this really is a great opportunity for Westminster? We cannot know because the stakeholders in our not-for-profit have not been part of the decision-making.
On repeated occasions President Dell’Omo has regaled us in excited tones that this transaction is “virgin territory,” a “seminal” event unprecedented in higher education. Putting aside his language of exploitation, if it's unprecedented, then he is setting the precedent right? And Dell’Omo’s precedent has been to ignore the stakeholders. His precedent has been to make a personal decision with regard to the programs, lives, and culture of our institution. And he’s made this decision in the dark.
We are Westminster. And we deserve to be part of the decisions that affect our futures. Our voices deserve to be heard.
Dell’Omo’s mode of operation is common in the world of for-profits. And as the education “industry” becomes corporatized, we see less and less focus on public good and more emphasis on private good. Two years ago, when the president and provost fired tenured faculty and eliminated majors and minors that weren’t “profitable”—fine arts and philosophy, for example— these people were prepared to lead a University without art and philosophy. As shocking as that was, perhaps we shouldn’t have been surprised they would also try to get rid of us. In March the Rider SGA questioned the wisdom of this administration’s plan. “With this loss,” they wrote, “the University has identified retaining world-class artistic programs as the least of its priorities.”
Recently the provost claimed accounting was the University’s “best” program. Our accounting program is excellent I thought, but you mean after Westminster, right? No. The misunderstanding was mine. When the provost said “best,” she meant “most profitable.” The University makes more money per capita on accounting majors than on any other program. The University’s academic leader equated “best” with “profitable”—not with the program that produces the greatest public good.
But we are Westminster—the program that creates the greatest public good. We develop the world’s musical leaders. Every day our graduates demonstrate their leadership in schools, places of worship, concert halls, their communities, private lessons, and through acts of creation. Their actions enrich the lives of millions of people worldwide. But our graduates know that leadership is not simply the assertion of one’s authority. It isn't something that flows down from a “superior” to subordinates. True leaders recognize that leadership is a form of service. Leadership is not about standing above, but alongside.
Our leaders have lost their way. But Westminster has not. Today we stand alongside one another, ready to lead.
We are Westminster. Hear our voices.