Crisis on Campus_ A Bold Plan for Reforming Our Colleges and Universities - Mark C. Taylor [75]
Tenure imposes costs both economic and educational. Let’s return to the analogy between financial capital on the one hand and, on the other, intellectual and cultural capital. It now becomes clear that tenure is a liquidity issue. Financially, declining assets and income combined with rising debt and expenses are making it increasingly difficult for colleges and universities to meet their ongoing financial obligations. Tenure is expensive. Take as the point of departure1 the average salary and benefits for a newly tenured faculty member at a private or public school, and make two assumptions: one, the person will be an associate professor for five years and a full professor for thirty years; two, salaries will increase at an annual rate of 3.5 percent. The total financial commitment for tenuring a professor at a private school will therefore be $12,198,578, and at a public school, $9,992,888. The endowment currently required to fund these positions is $3,959,743 and $3,252,426, respectively. Assuming a growth rate of 6 percent, the endowment necessary to support the tenured professor by the time of his or her retirement would be $28,721,197 (private) and $23,583,423 (public). These calculations include only salary and benefits and not related expenses like office space, secretarial support and research funds, which can cost additional tens or even hundreds of thousands of dollars each year. In fact, this represents the minimum expense incurred, since many tenured faculty members are paid much more than I assume here.
Two factors must be clearly distinguished in calculating the economic cost of tenure. One is the actual annual financial outlay and the endowment required to support it, and the other is the loss of liquidity that a tenure commitment imposes. With endowments plunging, and excessive debt and fixed costs rising, tenure creates a loss of financial flexibility just when it is most needed. The tenure system is financially punishing.
Even if tenure can be funded, it should be abolished. Illiquidity is as much a problem for intellectual and cultural capital as it is for financial capital. When intellectual assets are frozen, colleges and universities suffer. Once tenure is granted, there are no incentives to encourage faculty members to continue to develop and remain productive; nor is there any leverage to force them to do what they would prefer to avoid, even when it is good for the institution. Any unbiased observer would have to admit that it is simply impossible to predict whether an area of expertise that seems important today will be relevant in five years, to say nothing of thirty-five years. Nor is it possible to anticipate how promising scholars and teachers will perform in the future. In education as in finance, there is no such thing as a sure bet. It makes absolutely no sense for a college or university to make lifetime commitments to faculty members whose performance can be neither predicted nor modified. To be able to adapt to a rapidly changing world, it is essential for higher educational institutions to maintain flexible workforces. Tenure does not further that goal.
A mandatory retirement age must also be addressed. With increasing longevity and growing personal financial insecurity, many faculty members are deferring retirement longer and longer. Indeed, it is not uncommon for teachers to stay at work well into their seventies. This growing tendency leads to both financial and intellectual difficulties. In almost all cases, the more senior the person, the higher the salary.