How do we get there from here?

Yet another article, this time in The Atlantic, about the higher education on the verge of a major reconfiguration.  The outline is the same as usual--higher ed costs too much, is accessible to too few, and produces too little learning.  And technology is the answer.  The examples are the typical ones as well--MIT's open course initiative and the Khan Academy.

I agree with the author that higher ed needs to be reworked, and that the framing of the issue--how can we get better learning at lower cost in ways that respond to the needs and desires of students and society?--is the right one.

But that is the easy part.  It is simple to diagnose the disease, much harder to fix it.  Here is why: "free' alternatives like OpenCourse Ware or Khan Academy aren't free--they are either subsidized or make no money. For-profit options are expensive too--they charge students a premium for convenience.  Private non-profit institutions have budgets based on expensive tuition (though the level of tuition discounting means that budgets are not nearly as high as one would think).  Any move to offer a less expensive education runs up against the fact that the institution runs on a small margin at very high tuition.  And inexpensive public institutions are  subsidized, at capacity, and too poor to devote resources to vastly improving student learning. In short, most colleges and universities, public and private, are resource poor.  They don't have money to experiment, nor do they have R&D operations.

So how do we get to high quality, low cost education from where we are now, in the real world?  Are there incentives that exist for the leadership and faculty of private institutions that will encourage them to cut costs and maintain quality?  What are those incentives?  Are there different incentives for low-cost providers who are operating at capacity?

My view (which will be no surprise to readers of this blog) is that existing institutions will not be the leaders here.  It will be new colleges and universities who will figure out the cost/quality formula first. (Take a look at this proposal for a new university in England.  High quality, but high cost also.)  Reformers need to work to lower the barriers for new entrants.  They key barrier?  Access to federal financial aid. The students who will desire low-cost education are those with little money to invest in their educations.  But start-up colleges and universities lack the accreditation that gives them and their students access to financial aid.  No financial aid, no students, no new institutions.