Monday, October 16, 2017

The Decline of the Midwest's Public Universities Threatens to Wreck Its Most Vibrant Economies

Four floors above a dull cinder-block lobby in a nondescript building at the Ohio State University, the doors of a slow-moving elevator open on an unexpectedly futuristic 10,000-square-foot laboratory bristling with technology. It’s a reveal reminiscent of a James Bond movie. In fact, the researchers who run this year-old, $750,000 lab at OSU’s Spine Research Institute resort often to Hollywood comparisons.

Thin beams of blue light shoot from 36 of the same kind of infrared motion cameras used to create lifelike characters for films like Avatar. In this case, the researchers are studying the movements of a volunteer fitted with sensors that track his skeleton and muscles as he bends and lifts. Among other things, they say, their work could lead to the kind of robotic exoskeletons imagined in the movie Aliens.

The cutting-edge research here combines the expertise of the university’s medical and engineering faculties to study something decidedly commonplace: back pain, which affects as many as eight out of every 10 Americans, accounts for more than 100 million annual lost workdays in the United States alone, and has accelerated the opioid addiction crisis.

“The growth of the technology around us has become so familiar that we don’t question where it comes from,” says Bruce McPheron, an entomologist and the university’s executive vice president and provost, looking on. “And where it happens consistently is at a university.”

But university research is in trouble, and so is an economy more dependent on it than many people understand. Federal funding for basic research—more than half of it conducted on university campuses like this one—has effectively declined since 2008, failing to keep pace with inflation. This is before taking into account Trump administration proposals to slash the National Science Foundation (NSF) and National Institutes of Health (NIH) budgets by billions of dollars more.

Trump’s cuts would affect all research universities, but not equally. The problem is more pronounced at public universities than private ones, and especially at public institutions in the Midwest, which have historically conducted some of the nation’s most important research. These schools are desperately needed to diversify economies that rely disproportionately on manufacturing and agriculture and lack the wealthy private institutions that fuel the knowledge industries found in Silicon Valley or along Boston’s 128/I-95 corridor. Yet many flagship Midwestern research universities are being weakened by deep state budget cuts. Threats to pensions (in Illinois) and tenure (in Wisconsin) portend an exodus of faculty and their all-important research funding, and have already resulted in a frenzy of poaching by better-funded and higher-paying private institutions, industry, and international competitors.

While private institutions are better shielded from funding cuts by huge endowments, Midwestern public universities have much thinner buffers. The endowments of the universities of Iowa, Wisconsin, and Illinois and Ohio State, which together enroll nearly 190,000 students, add up to about $11 billion—less than a third of Harvard’s $37.6 billion. Together, Harvard, MIT, and Stanford, which enroll about 50,000 students combined, have more than $73 billion in the bank to help during lean times. They also have robust revenues from high tuitions, wealthy alumni donors, strong credit, and other support to fall back on. Compare that to the public university system in Illinois, which has cut its higher-education budget so deeply that Moody’s downgraded seven universities, including five to junk-bond status.

This ominous reality could widen regional inequality, as brainpower, talent, and jobs leave the Midwest and the Rust Belt—where existing economic decline may have contributed to the decisive shift of voters toward Donald Trump—for places with well-endowed private and better-funded public universities. Already, some Midwestern universities have had to spend millions from their battered budgets to hang on to research faculty being lured away by wealthier schools. A handful of faculty have already left, taking with them most if not all of their outside funding.

“We’re in the early stages of the stratification of public research universities,” said Dan Reed, the vice president for research and economic development at the University of Iowa. “The good ones will remain competitive. The rest may decline.” Those include the major public universities established since the 1860s, when a federal grant set aside land for them in every state. “We spent 150-plus years building a public higher-education system that was the envy of the world,” said Reed, who got his graduate degrees at Purdue, in Indiana. “And we could in a decade do so much damage that it could take us 30 years to recover.”
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That land grant was called the Morrill Act. Abraham Lincoln signed it into law during the depths of the Civil War, in 1862, resulting in the establishment or major expansion of, among others, Purdue, the University of Illinois at Urbana-Champaign, the University of Minnesota, the University of Missouri, and Ohio State. Along with many other major public universities in the Midwest, each would go on to have an outsized impact.

It was at Illinois that the first modern internet browser was developed, along with other advances in computer science and technology including early versions of instant messaging, multiplayer games, and touch screens. Today, researchers there are working on a new treatment for brain cancer, a way to boost photosynthesis to increase crop yields, and a solution to the growing problem of antibiotic resistance.

Scientists at the University of Minnesota created the precursor to the World Wide Web, performed the first open-heart surgery, and developed Gore-Tex waterproof fabric. The University of Wisconsin is where human embryonic stem cells first were isolated, and it has since become a center of stem-cell research. Researchers there are trying to develop new drugs to fight the Ebola and West Nile viruses. The University of Iowa’s Virtual Soldier Research Program uses human modeling and simulation to design new military equipment, and its National Advanced Driving Simulator is heavily involved in driverless-vehicle research.

Universities perform more than half of all basic research in America, and public research universities in particular account for two-thirds of the $63.7 billion allocated annually by the federal government for research. That spending, in turn, produces more than 2,600 patents and 400 companies a year, according to the Association of University Technology Managers.

The impact on local economies is hard to miss. In places like Columbus, Ohio, and Columbia, Missouri, the big research universities are among the most important institutions in town. The checkerboard patchwork of farms on the approach to Port Columbus International Airport gives way to office buildings housing high-tech companies spun off by Ohio State and the affluent suburbs where their employees live. The real-estate company CBRE ranks the city as the country’s top small market for attracting tech talent.

More than one in five graduate students who worked on sponsored research at eight Big Ten universities studied by Ohio State economist Bruce Weinberg, including Indiana, Michigan, Minnesota, Purdue, and Ohio State, stayed in the state where they attended school—13 percent of them within 50 miles of the campus. That may not sound like a lot—and, indeed, the exodus of highly educated people is a serious problem—but it’s significant when considering that the jobs for these students exist in a national labor market. People with engineering Ph.D.s from Minnesota could take their talents anywhere. If even 20 percent stick around, that’s a big win for states that can’t expect an influx of educated elites from other parts of the country. These graduates provide an educated workforce that employers need, create jobs themselves by starting their own businesses, and pay taxes.

These universities have served as bulwarks against a decades-long trend of economic activity fleeing smaller cities and the center of the country for the coasts. Since the 1980s, deregulation and corporate consolidation have led to a drastic hollowing out of the local industries that once sustained heartland cities. But a university can’t just be picked up and moved from Madison to New York in the way a bank, an insurance company, or even a factory can be.

“What difference does having a major research university in a place like Wisconsin make?” said Rebecca Blank, the chancellor of the University of Wisconsin. “It’s the future of the state.” If Blank is right, then current trends put that future in doubt for much of the Midwest. Many of these same universities have suffered some of the nation’s deepest cuts to public higher education. Illinois reduced per-student spending by an inflation-adjusted 54 percent between 2008 and last year, according to the Center on Budget and Policy Priorities. The figure was 22 percent in Iowa and Missouri, 21 percent in Michigan, 15 percent in Minnesota and Ohio, and 6 percent in Indiana. While higher education funding increased last year in 38 states, Scott Walker’s budget for 2015 through 2017 cut another $250 million from the University of Wisconsin system. The University of Iowa recently had its state appropriation cut by 6 percent, including an unexpected $9 million in the middle of the fiscal year. (...)

These financial woes would only be made worse by Trump’s proposed budget, which would cut funding by between 11 percent and 18 percent for the federal agencies that provide the bulk of government support for university research. Congress has so far resisted this call, instead adding $2 billion to the NIH and $8.7 million to the NSF in the five-month budget extension approved in April. But budget cuts remain a threat. So does a Trump budget proposal to eliminate so-called indirect cost payments—billions of dollars’ worth of federal reimbursements for overhead such as lab space and support staff to conduct the research. (The House Republicans’ 2018 budget plan rejects that idea, at least for medical research.)

Private universities with big endowments and wealthy donors may be able to weather the storm. (So, too, may the handful of public universities, like the University of Michigan and the University of Virginia, that receive far more private than public funding.) But most public research institutions won’t.

by Jon Marcus, The Atlantic |  Read more:
Image: David Mercer