Fragile Stability

Two years ago the Carnegie Commission on Higher Education found that three-fifths of American colleges and universities were either in financial trouble or headed for it. Commission Chairman Clark Kerr declared it the "greatest crisis in the 330 years since the founding of Harvard." Since then, most institutions have made heroic attempts to control costs, and the efforts appear to have paid off. This week the commission will issue a follow-up study, which concludes that in general, colleges and universities have stopped their slide toward bankruptcy, though the depression in higher education has by no means ended.

Both studies were based on a detailed analysis of 41 representative private and public campuses (U.S. total: 2,500) by Economist Earl F. Cheit, a Berkeley professor working temporarily this year for the Ford Foundation. He found that most of the colleges had frozen faculty salaries and deferred building maintenance, and that many had made even more extraordinary cuts. For example, New York University sold its University Heights campus. The state college system in Minnesota laid off 168 faculty members. Fisk University abolished its Afro-American institute. St. Louis University closed its schools of dentistry and engineering. In addition, nearly all institutions have improved their management practices, often borrowing techniques from business, such as more sophisticated use of computers and better budgeting.

Many of these savings clearly cannot be sustained for very long; nor can they be duplicated in the future. Moreover, the financial condition of colleges and universities could be upset by unforeseen changes in matters largely beyond the institutions' control -an increase in the rate of inflation, an unexpected decline in the number of high school graduates wanting to continue their education, or more cuts in federal and state support. Thus the current stability of most colleges and universities, welcome as it may be to hard-pressed administrators, is fragile at best.

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