Deep Recession Cuts at State Colleges and Universities Persist

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During the recession, many states slashed their higher education budgets, affecting students at their community colleges as well as four-year universities. Now that the recession is over, some states are beginning to increase spending to make up for lost ground. Unfortunately, Arizona is part of a small number that’s continuing to cut resources.

Last week, Arizona’s governor and legislature voted to eradicate state funding of two of their largest state community college systems, Maricopa and Pima. These cuts follow additional decreases in 2011 and 2012 of over $38 million and add up to approximately $80 million over a seven-year period. Thankfully, the Legislature saved the third, Central Arizona College in Pinal County. This system will continue to receive $2 million in state support.

These cuts are in addition to cuts in funding across the Arizona college system. In turn, university leaders are drastically increasing tuition, leading to an escalation in student debt as well as a decrease in the quality of education offered. According to the Center on Budget and Public Priorities, Arizona tuition at four-year colleges increased by almost $4,500 per student, or more than 80 percent (adjusted for inflation) since the 2007-8 school year. At the same time, faculty was reduced by over 2100 positions, and 182 colleges, school programs and departments were reduced as well as the elimination of eight extension or distant learning programs.

Throughout the country, state funding per student is down 23 percent, or over $2,000, due to the recession. All states except Alaska and North Dakota are spending less than they did before the recession. These cuts in funding are at a time when colleges are struggling to educate more students. Over one million or 10 percent more full-time students have enrolled since the recession. These are diverse students, including 18- through 24-year-olds who are part of the “baby boom echo” as well as older workers looking to retool and gain new skills.

Although many are turned away from higher education as tuition rises, those that enroll are seeing a growth in student debt. By the last quarter of 2013, student debt across all institutions swelled to $1.08 trillion, more than car loans and credit card debt. In four years, the median amount of those with student debt obtaining a bachelor’s degree at a four-year public institution grew from $11,900 to $14,300 (in 2012 dollars.) This translates to a 20 percent increase.

Increased tuition is leading to a growth in inequality between low-income and equally qualified upper-income students. According to a 2008 article by Georgetown University scholar Anthony Carnevale, tuition increases led to highly qualified students (top testing 25 percent) from upper income families going to four-year colleges at almost twice the rate of low-income equally qualified students.

Thankfully, in the last year many states are beginning to rebuild their college systems. States like Tennessee are dramatically increasing government support of their community colleges. In addition, ten states increased funding to their public college systems. The largest increases per pupil were in New Hampshire with an increase of 28.5 percent, North Dakota increased by 20.3 percent and Florida with an increase of 18.8 percent. While these increases are encouraging, eight other states continue to cut government funds. The largest decrease was in Wyoming where state government slashed funding by 7.2 percent.

Unlike the state government leaders, who are unable to see the connection between strong community college systems and productive workforces, Arizona corporations like Marriott International, Ford, and Amazon are teaming with Maricopa to create Maricopa Corporate College. These new partnerships are offsetting a portion of the state’s cuts. In addition to the concerns these types of partnerships create, the community college system is limited by the amount of private funds it can raise due to legal regulations.

In Arizona, Maricopa college leaders voted to not raise tuition. Instead, they are focused on increasing funds from alumni as well as other development efforts.

Original cite: https://nonprofitquarterly.org/policysocial-context/25802-deep-recession-cuts-at-state-colleges-and-universities-persist.html

Gates Foundation Invests in Corporation to Fight Disease

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The Bill & Melinda Gates Foundation is investing $52 million in CureVac, to fund a new factory in Germany. The factory will make drug products using mRNA. This represents the foundation’s largest ever investment in a corporation. It is also a symbol of what the world learned since the Ebola outbreak, diseases in poor countries affects health across the world.

The Gates Foundation’s majority equity investment will be used to build a $76 million factory developing products using mRNA, a messenger chemical that provides information from the gene into cell parts making proteins. It is believed that mRNA can be used as a platform for rapidly producing low-cost drugs and vaccines. These products are “thermostable,” meaning they do not need cold-chain storage, a major hurdle in supplying vaccines in developing countries.

Additionally, the two organizations are forging a larger partnership as part of the foundation’s focus on vaccines that fight global diseases that disproportionally affect people in the poorest countries. The Gates Foundation’s mission is “guided by the belief that every life has equal value….[The] Foundation works to help all people lead healthy, productive lives. In developing countries, the emphasis on vaccines leads to better health thereby increasing individuals’ ability to lift themselves out of extreme poverty.” This initial project is part of a larger plan to invest billions to develop vaccines for viral, bacterial, and parasitic infectious diseases including rotavirus and HIV.

This investment is part of the trend of foundations turning to corporations rather than nonprofits or other foundations to solve the world’s inequities. These partnerships are part of socially responsible investing, or SRI. SRI includes impact investing, shareholder advocacy, and community investing, and is designed to encourage corporations to act in a socially respectable manner in addition to making a profit.

Because the majority of medical research is driven by the desire to make a profit, corporations and the world’s scientists are focused on drugs and vaccines that will make the largest monetary return on investment. These are rarely realized in medicine that’s focused on outbreaks in the world’s poorest countries. World NGOs have described this as “the 10/90 gap”; ten percent of global health research is focused on ninety percent of the world’s diseases. Ignoring these diseases leads to epidemics like the recent Ebola outbreak.

While there are clearly questions embedded in such tight relationships between nonprofit and for-profit organizations, these types of partnerships are gaining support with conservatives as well as liberals. Prime Minister Stephen Harper of Canada recently met with Bill Gates to discuss their shared goal of improving the lives of women and child around the world. Canada is funding twenty research teams of African and Canadian scientists to expand immunizations in order to eradicate polio and eliminate tetanus.

The CureVac factory is expected to produce additional products funded by the foundation. The corporation will hold the licenses created by the partnership and sell the products at an affordable price in poor countries.

Original cite: https://nonprofitquarterly.org/philanthropy/25738-gates-foundation-invests-in-corporation-to-fight-disease.html