Fraternities "disaffiliating" from Duke

[OldPhiKap]

National Geographic Society does this, too, I think. Seem to remember them in a few magazines.

Random non-profit story: My wife is a development director for a non-profit that provides certain services to people with disabilities. Every once in a while, they'll have a lawyer wander onto the farm (literal farm). Non-profits go under with such frequency that people often die but haven't updated or didn't know to update their wills and change the beneficiary organization. So, lawyers do a google search to find non-profits that meet the deceased's intent...and those are my wife's best days. Had a guy just walk in one day and offer $500,000. Had to get a judge's approval, which they did and now they have an extra 6 months of operating budget out of nowhere.

I co-founded and ran a small non-profit that helped people with specific disabilities, especially veterans. We had a similar story without the farm. A lawyer found us with a Google search. After an interview and some documentation, we were awarded around $200,000. That was a lot of money for us and enabled us to expand our mission.

Those are usually known as Cy Pres funds — worth asking the local chief judge or court administrator how to get your group on the list if you are a non-profit.

[duke79]

That's part of my problem I guess. Here's something to make students and recent graduates sick to their stomachs:

I just dug through my Duke file and found the letter from Duke (dot-matrix printer!) on what total costs for the 1980-81 year would be. Hold your breath...

$8, 580

I thought I got a durn good education fer that! Mighty fine investment!

From the Duke website (https://financialaid.duke.edu/underg...pplicants/cost), total costs for the 2020-21 year are (hold your ______)...

$78,828

IANAEconomist, but I believe that far outstrips inflation. My entire education cost less than a current semester. It's outrageous, egregious, and preposterous.

According to my trusty HP 12C calculator, that increase in tuition, room and board, over the 40-year period, works out to be a 5.7% annual increase, compounded over the 40 years. This is about double the increase in the CPI (consumer price index) over this same time (although some economists maintain that the CPI understates the true cost-of-living inflation that most people face).

When I started at Duke in the mid-1970's, I believe the cost for tuition, room and board was about $4,800 per year. When my late father attended Duke in the early 1940's (at the tail end of the great depression), the cost was about $1,000 per year, and my father used to complain quite often about how much it was costing him to send me to Duke (and that works out to be about a 4.6% annual increase over that 35-year time period, so not hugely different than what has happened over the last 40 years). I also remember that, in the 1970's, Duke was about $1,000 less per year to attend than many of its peer institutions (Ivy League schools, Stanford, etc) and it was considered a "bargain" to attend. Then, at some point in the late 70's, Duke suddenly announced that it was raising its costs substantially to be in line with the other schools (under the somewhat faulty logic that it would make Duke more competitive with those other schools with potential applicants). Of course, my take (and also that of many others) is that Duke simply wanted more money and knew they could get away with it.

PS: LOVE that scene from Seinfeld - just hilarious. Thanks for linking!

[cspan37421]

I would like to compare operating budgets from 35 yrs ago to today. I have a sense that the % allocated to non-teaching positions has soared. It would be interesting to know if that was true.

[budwom]

According to my trusty HP 12C calculator, that increase in tuition, room and board, over the 40-year period, works out to be a 5.7% annual increase, compounded over the 40 years. This is about double the increase in the CPI (consumer price index) over this same time (although some economists maintain that the CPI understates the true cost-of-living inflation that most people face).

When I started at Duke in the mid-1970's, I believe the cost for tuition, room and board was about $4,800 per year. When my late father attended Duke in the early 1940's (at the tail end of the great depression), the cost was about $1,000 per year, and my father used to complain quite often about how much it was costing him to send me to Duke (and that works out to be about a 4.6% annual increase over that 35-year time period, so not hugely different than what has happened over the last 40 years). I also remember that, in the 1970's, Duke was about $1,000 less per year to attend than many of its peer institutions (Ivy League schools, Stanford, etc) and it was considered a "bargain" to attend. Then, at some point in the late 70's, Duke suddenly announced that it was raising its costs substantially to be in line with the other schools (under the somewhat faulty logic that it would make Duke more competitive with those other schools with potential applicants). Of course, my take (and also that of many others) is that Duke simply wanted more money and knew they could get away with it.

PS: LOVE that scene from Seinfeld - just hilarious. Thanks for linking!

A few years ago I calculated what Duke's full tuition, room and board would be had it risen by the CPI since my tenure there in the early 70s, it came out to be just about exactly half of what it actually was...

[duke79]

I would like to compare operating budgets from 35 yrs ago to today. I have a sense that the % allocated to non-teaching positions has soared. It would be interesting to know if that was true.

Yea, at one point about a year ago, I looked at the total number of employees (and I don't think it included the hospital system) at Duke and then at the number of professors (full, assistant, associate, adjunct, etc) and there was about a 10 to 1 ratio of total employees to "teachers". I'm not sure if this type of ratio applies to other schools of Duke's size and how it compares to 40 years ago, but it does seem like a lot of non-teaching personnel have to be supported.

[CrazyNotCrazie]

I would like to compare operating budgets from 35 yrs ago to today. I have a sense that the % allocated to non-teaching positions has soared. It would be interesting to know if that was true.

The spending on non-teaching positions is huge. Also, there is the evolution (or I would argue the devolution) of universities into luxury resorts. I hate to sound like a grumpy old guy, but students are no longer content eating rotini and red sauce at the Rat, Burger King, or a basic sandwich at the CI. I was embarrassed by the new dining facility West Campus. Similarly, the standard item mentioned in these discussions are the climbing walls. Unfortunately, there is an arms race among schools, and they find eager donors who want to plaster their names on these fancy accoutrements so that their alma mater is as nice as other schools. Also, as others have mentioned, there is luxury status generated from being an expensive university. Which works fine for elite schools like Duke. I'm not sure how that works for schools that aren't as elite - at many of those, few students are truly paying sticker price.

The other major challenge for Duke and other universities is technology. Corporate America is constantly innovating to use technology to do business in a more cost efficient way. The delivery model for a college education has not significantly changed in decades. As a result, there is no way to generate cost savings from doing things more efficiently.

[duke79]

The spending on non-teaching positions is huge. Also, there is the evolution (or I would argue the devolution) of universities into luxury resorts. I hate to sound like a grumpy old guy, but students are no longer content eating rotini and red sauce at the Rat, Burger King, or a basic sandwich at the CI. I was embarrassed by the new dining facility West Campus. Similarly, the standard item mentioned in these discussions are the climbing walls. Unfortunately, there is an arms race among schools, and they find eager donors who want to plaster their names on these fancy accoutrements so that their alma mater is as nice as other schools. Also, as others have mentioned, there is luxury status generated from being an expensive university. Which works fine for elite schools like Duke. I'm not sure how that works for schools that aren't as elite - at many of those, few students are truly paying sticker price.

The other major challenge for Duke and other universities is technology. Corporate America is constantly innovating to use technology to do business in a more cost efficient way. The delivery model for a college education has not significantly changed in decades. As a result, there is no way to generate cost savings from doing things more efficiently.

Admittedly, at many of the wealthy, well-endowed schools (including Duke), about 50 to 55% of the kids receive some form of financial aid/grants/scholarship, so those schools can claim that most of the kids (or their parents) are not really paying the full, listed cost of attending the school (I've seen some estimates that the average "rate" paid is somewhere in the range of $30,000 to $35,000 per year at private colleges and universities). BUT I'm still amazed that, at most of the top schools, 45 to 50% of the students (and their parents) ARE paying the full cost (and when you take into account the associated costs of attending college - books, spending money, clothes, transportation, etc., it works out to $85,000 to $90,000 per year and this is an after-tax amount, so for many people, you would need to earn $140,000 or so to net out the $90,000 needed to pay one year's worth of costs). It makes you realize that we DO live in an affluent society (for some people, at least).

Interestingly, I looked at the employee/professor ratio for a small, top-rated private college (2,000 students) near where I live (Williams College), and, there, the ratio of non-teaching employees to "teachers" is about 3.5 to 1 BUT the cost of attending Williams is almost identical to Duke. I don't know if they are more generous with financial aid than Duke (and they have a very large endowment).

[OZZIE4DUKE]

I'd be VERY curious to see a comparison between the components of revenue and expense at Duke in 1981 and today, or any peer university. I'd also be curious how state funding levels for higher education have changed in the last 40 years as well.

Well, one difference is that in 1981 they didn't spend much on football and basketball, and the athletic fields that served as parking lots were dirt and gravel. Also didn't make much on either sport, and television revenue from CD Chesley certainly wasn't much.

[cspan37421]

Interestingly, I looked at the employee/professor ratio for a small, top-rated private college (2,000 students) near where I live (Williams College), and, there, the ratio of non-teaching employees to "teachers" is about 3.5 to 1 BUT the cost of attending Williams is almost identical to Duke. I don't know if they are more generous with financial aid than Duke (and they have a very large endowment).

That is interesting. Though with something like Duke Medical Center as a huge part of the budget and perhaps similar influence on the EE/Professor ratio, I really wonder if we're comparing apples and orangutans. Or lemurs vs. femurs.

One might also speculate about differences in teaching/instructional quality between large research universities and small LACs.

[Bluedog]

Then, at some point in the late 70's, Duke suddenly announced that it was raising its costs substantially to be in line with the other schools (under the somewhat faulty logic that it would make Duke more competitive with those other schools with potential applicants). Of course, my take (and also that of many others) is that Duke simply wanted more money and knew they could get away with it.

I actually read an article about MBA programs that cited evidence that increasing their tuition actually increased applicant's perception of the prestige of the institution...And more people applied. The analysis wasn't conducted for undergraduate institutions though. But pretty funny. People sometimes think "you get what you pay for."

As noted above, though, Duke's "sticker price" today has perhaps a different lens than the price in the 70s when I imagine hardly anybody got financial aid. Now, Duke can basically charge whatever it wants because the wealthy are willing to pay for it apparently, and everyone else gets large rebates (i.e. financial aid). So, I guess one still talk about the comparison for those with high-earning salaries, but the actual "Average cost" is much more reasonable. Universities likely also increase the cost superficially knowing that not everyone will pay full fare, so they need to compensate for the ~1/3 of the student body (or thereabouts) that pays nothing. (For the record, I benefited from financial aid at Duke...and am grateful for that).

[duke79]

That is interesting. Though with something like Duke Medical Center as a huge part of the budget and perhaps similar influence on the EE/Professor ratio, I really wonder if we're comparing apples and orangutans. Or lemurs vs. femurs.

One might also speculate about differences in teaching/instructional quality between large research universities and small LACs.

I believe that the employee numbers I looked at for Duke did not include the medical center but did include the rest of the university; my daughter just graduated from a small, highly-rated, liberal arts college (about 2,000 students) and, when you were on campus, it just felt like a much smaller "footprint" than when visiting a large university like Duke; the athletic department was much smaller (it was not a "jock" school); there were no "Institutes for the study of the spotted salamander in the northern Peruvian Andes, etc." and you got the impression that it would be much easier to "run" the college with fewer employees besides professors.

I'm a little confused about your last statement: Are you implying the teaching/instructional quality is better at the larger research universities?

[duke79]

I actually read an article about MBA programs that cited evidence that increasing their tuition actually increased applicant's perception of the prestige of the institution...And more people applied. The analysis wasn't conducted for undergraduate institutions though. But pretty funny. People sometimes think "you get what you pay for."

As noted above, though, Duke's "sticker price" today has perhaps a different lens than the price in the 70s when I imagine hardly anybody got financial aid. Now, Duke can basically charge whatever it wants because the wealthy are willing to pay for it apparently, and everyone else gets large rebates (i.e. financial aid). So, I guess one still talk about the comparison for those with high-earning salaries, but the actual "Average cost" is much more reasonable. Universities likely also increase the cost superficially knowing that not everyone will pay full fare, so they need to compensate for the ~1/3 of the student body (or thereabouts) that pays nothing. (For the record, I benefited from financial aid at Duke...and am grateful for that).

Yea, I think that back when Duke did raise their tuition in the late 70's to be comparable (or comprable) to the Ivies and other top schools, this was one of the reasons they gave - that some potential applicants thought less highly of Duke because it was NOT as expensive as some of the other top schools and Duke thus needed to raise their tuition if they wanted to be included in the top echelon of schools at that time. Again, I also think that they just wanted more revenues coming in and they knew that almost everyone would pay the higher costs.

I think there was actually quite a bit of financial aid (mostly "scholarships" and not so many loans) given out in the 70's - I knew quite a few students who were receiving some type of aid at the time and many students had some type of on-campus job as part of the financial aid package. Even though the costs seem almost trivial compared to today, it was STILL expensive when you compared the cost to the average family's income was back then.

It was definitely a different story when my mother and father attended Duke back in the 1940's - then, there was almost no financial aid given out. You either had the money to pay the tuition and room and board or you didn't attend. There were people working two or three jobs to pay their way through college but they got almost nothing from the school itself. I read a story a few years ago that, in the 1930's, many of the Ivy League schools - Harvard, Yale, Princeton, etc. - couldn't even fill up their classes, there were so few people who could afford the tuition.

[cspan37421]

I'm a little confused about your last statement: Are you implying the teaching/instructional quality is better at the larger research universities?

Not at all. Sorry for the confusion. I tried to imply that there's conventional wisdom that teaching quality at LACs is higher because of, among other things, smaller classes, more attention*, instructors who are able to give more focus to teaching duties as a result of less pressure to generate published research, etc.

My experience at Duke was that my smaller classes were NOT better than my larger ones; in fact, the mid-sized ones were the best, followed by the large classes. The small ones I had were the worst. But ... small sample size. Instruction wise, there was also no relation (IME) between teaching quality and job title. I had a couple terrific grad students and one utterly worthless (to me) full-professor/endowed chair. I also had lousy grad students and excellent full professors. On average, the midrange was (again) the sweet spot for me (associate professor, assistant professor). Bottom line, I can't say that any conventional rule of thumb about teaching quality held true for me at Duke.

* The attention angle is an interesting one, tying back to fraternities indirectly. My experience with professor attention at Duke was that they were quite happy to talk to you in office hours, and they were not at all overly booked during such time. On the contrary - as Reynolds Price (in)famously noted in a Founder's day address. So I got all the attention and extra help I wanted - it was there for the taking. It seemed to me that very few, if any (in my classes) took advantage of such. Price also had a few choice words about fraternities in that address, but I'll leave those to his legacy and for the curious to look up. As hinted above, my frat(s) were purely honorary and therefore not of the sort that truly relate to the topic of this thread.

[CrazyNotCrazie]

I actually read an article about MBA programs that cited evidence that increasing their tuition actually increased applicant's perception of the prestige of the institution...And more people applied. The analysis wasn't conducted for undergraduate institutions though. But pretty funny. People sometimes think "you get what you pay for."

As noted above, though, Duke's "sticker price" today has perhaps a different lens than the price in the 70s when I imagine hardly anybody got financial aid. Now, Duke can basically charge whatever it wants because the wealthy are willing to pay for it apparently, and everyone else gets large rebates (i.e. financial aid). So, I guess one still talk about the comparison for those with high-earning salaries, but the actual "Average cost" is much more reasonable. Universities likely also increase the cost superficially knowing that not everyone will pay full fare, so they need to compensate for the ~1/3 of the student body (or thereabouts) that pays nothing. (For the record, I benefited from financial aid at Duke...and am grateful for that).

The people who get hurt by the inflated prices are the middle class/upper middle class. The truly rich don't care about the price. The poor will get a lot of aid. The upper middle class are stuck paying most or all of the posted cost.

Ironically, guess who gets impacted the most by this? Children of alumni. Everyone outside of Duke assumes that all alums are rich, but in reality, most are middle/upper middle class, living in expensive metro areas where those seemingly large salaries don't go very far. So there are a lot of alums who would love to send their kids to dear alma mater, but is a huge stretch.

There are publicly available statistics that show how much the average student actually paid such as "Net tuition per student" - I occasionally deal with these for work - the most recent figure I have for Duke for from about 2 years ago is $32,400. The denominator for this is total FTE so a relatively smaller school like Duke with a large number of athletic scholarships comes out lower than a bigger school.

[dudog84]

Yea, I think that back when Duke did raise their tuition in the late 70's to be comparable (or comprable) to the Ivies and other top schools, this was one of the reasons they gave - that some potential applicants thought less highly of Duke because it was NOT as expensive as some of the other top schools and Duke thus needed to raise their tuition if they wanted to be included in the top echelon of schools at that time. Again, I also think that they just wanted more revenues coming in and they knew that almost everyone would pay the higher costs.

I think there was actually quite a bit of financial aid (mostly "scholarships" and not so many loans) given out in the 70's - I knew quite a few students who were receiving some type of aid at the time and many students had some type of on-campus job as part of the financial aid package. Even though the costs seem almost trivial compared to today, it was STILL expensive when you compared the cost to the average family's income was back then.

It was definitely a different story when my mother and father attended Duke back in the 1940's - then, there was almost no financial aid given out. You either had the money to pay the tuition and room and board or you didn't attend. There were people working two or three jobs to pay their way through college but they got almost nothing from the school itself. I read a story a few years ago that, in the 1930's, many of the Ivy League schools - Harvard, Yale, Princeton, etc. - couldn't even fill up their classes, there were so few people who could afford the tuition.

I arrived in '80, so maybe I don't exactly qualify with the bolded. But I gotta disagree. I got a little bit of "grant" money, but the large majority of my financial aid was loans. Off the top of my head I had a GSL (Guaranteed Student Loan), an NDSL (National Direct Student Loan), a PHEAA (Pennsylvania Higher Education Assistance Agency(?) from my home state), and work-study. I was pretty well-accomplished in high school and graduated in the top 20% of my Duke class. Not a penny of scholarship money.

Though I'm sure I wasn't the poorest student at Duke, I can honestly say I was the poorest I encountered...with the possible exception of my freshman roommate, and we were put in a "temporary double" in the smallest room in the dorm. Funny how that worked out. Not complaining, I posted above that I thought Duke was a good investment, but I have often wondered if I should have gone to Penn State.

[throatybeard]

I'd also be curious how state funding levels for higher education have changed in the last 40 years as well.

In short, they've cratered, and that cost has been offloaded on the student.

At UMSL, we're down to about 17% of our budget coming from the state. They cut us during good economic times for the state and absolutely pummel us during bad ones.

[dudog84]

In short, they've cratered, and that cost has been offloaded on the student.

At UMSL, we're down to about 17% of our budget coming from the state. They cut us during good economic times for the state and absolutely pummel us during bad ones.

Do you have numbers on what it used to be say 10, 20, 40 years ago? Not looking for exact numbers or research, but ballpark.

[bundabergdevil]

Those are usually known as Cy Pres funds — worth asking the local chief judge or court administrator how to get your group on the list if you are a non-profit.

Thanks! My wife may already be aware but I’ll let her know. I’ll tell her my counsel is a basketball chat forum lawyer. She already thinks so highly of my judgment...😂

[sagegrouse]

Admittedly, at many of the wealthy, well-endowed schools (including Duke), about 50 to 55% of the kids receive some form of financial aid/grants/scholarship, so those schools can claim that most of the kids (or their parents) are not really paying the full, listed cost of attending the school (I've seen some estimates that the average "rate" paid is somewhere in the range of $30,000 to $35,000 per year at private colleges and universities). BUT I'm still amazed that, at most of the top schools, 45 to 50% of the students (and their parents) ARE paying the full cost (and when you take into account the associated costs of attending college - books, spending money, clothes, transportation, etc., it works out to $85,000 to $90,000 per year and this is an after-tax amount, so for many people, you would need to earn $140,000 or so to net out the $90,000 needed to pay one year's worth of costs). It makes you realize that we DO live in an affluent society (for some people, at least).

Interestingly, I looked at the employee/professor ratio for a small, top-rated private college (2,000 students) near where I live (Williams College), and, there, the ratio of non-teaching employees to "teachers" is about 3.5 to 1 BUT the cost of attending Williams is almost identical to Duke. I don't know if they are more generous with financial aid than Duke (and they have a very large endowment).

Apples and oranges. Duke is a major research university with a medical school as part of it. Williams is an outstanding private college with only two graduate programs, both offering only masters' degrees.

[sagegrouse]

I stated somewhere above that a lot of private institutions charge roughly the same tuition. All these institutions have very large need-based or merit-based scholarship programs. There are three classes of such institutions -- those with minimal endowments where the "scholarship" is really a tuition rebate. (The accountants, with a straight face, argue that this is a "cost.") A few very, very rich universities where the scholarships are paid for totally out of endowment funds. (Harvard's endowment exceeds $40 billion). Then -- everyone else. Duke has sizable endowment and one of President Brodhead's initiative was to raise endowment to fund scholarships totally. We made some progress, but I think there is more to do. Of those in the third group, Duke is clearly one of the strongest financially, but some scholarship (and fellowship) funds come out of the general revenue (like, other people's tuition).

The world of higher ed has changed substantially over the past ten years -- beginning when Harvard said that no one whose family makes less than some amount ($100k?) should pay any tuition at all. Others followed suit (and Ivy athletic directors were quite pleased). And Harvard, Duke, UPenn and other universities have come out against the use of so much in the way of student loans, resulting in more grants and fewer loans. I am not totally current on this latter topic.