No doubt many conservatives, especially those in higher education, have been clinking glasses at the news that Claudine Gay has resigned after a short and undistinguished presidency at Harvard University. Gay was responsible for the mistreatment of conservative scholars at Harvard and rose through the ranks of higher education by trading on her identity while putting out plagiarized scholarship. There has been plenty of analysis of the specific instances of plagiarism and their relative severity. What is interesting, however, is that none of this seems to have anything to do with being a good president of a university. 

What does a university president do? First, the president raises money. Second, the president is the face of the university. Whenever there is a problem, she is the one who appears on television, meets with faculty, and takes calls from donors and important alumni. Presidents are not the final authority on most things, and they almost never handle student or faculty controversies the way some conservative commentators seem to think they do. A university president is doing her job when she is raking in the cash and representing the university well. In the end, Gay was doing neither. While Harvard was never going to close, she had upset enough donors that she was, on balance, a problem rather than an asset for fundraising. She had put on a bad face for the university, starting with her December 5 appearance before the Committee on Education & the Workforce alongside Liz Magill, former president of the University of Pennsylvania.

Magill stepped down a mere six days after the appearance. Only a few months before, Marc Tessier-Lavigne resigned from Stanford University after the discovery that he had misrepresented his research. All these resignations have two factors in common: money and prestige.

The Prestige Economy

Money and prestige are the two currencies of higher education. They are related but distinct. For a university, money is not just tuition revenue, but also grants, donations, and endowments. A university that relies entirely on tuition is poor and, in this climate, likely to close. Grants are discrete allocations of money for particular research or teaching roles, such as those given by the National Science Foundation or the Ford Foundation. Donations are usually from wealthy individuals with specific intentions attached to them, such as to pay for a new dormitory or fund a new music school. Endowments are collections of funds that the university invests that can be used for a rainy day or a major expansion.

Prestige is difficult to define, but it requires a good reputation combined with highly selective admissions. Universities can acquire good reputations by graduating excellent students, but they can also acquire them by attracting the sons and daughters of elites. The latter often wins one the title of a “finishing school,” but finishing schools still deal with elites in ways that less prestigious institutions simply do not. Contemporary elite universities do both—mixing incredibly talented students with scions of the upper crust. 

Prestige relates to money in that prestigious schools attract more grants and donations, because of their excellent students and also the eagerness of wealthy donors to have their children admitted. As a result, these institutions can spend money on fine arts programs, more faculty, better student services, and better facilities. Low-prestige universities often have to focus on budgets, which may mean opting for low-prestige signals like merging departments or relying on contingent faculty.

Over the past few years, I have become increasingly baffled at how little of this conservative commentators understand. Conservatives often joke about the irrelevance of higher education by quoting Sayre’s law, “The politics of the university are so intense because the stakes are so low.” Nothing could be further from the truth. Universities house scholars, whose work is both in research and the formation of students. If conservatives have no place in higher education, there will be no conservative scholarship and very few conservative students. Indeed, the falsehood of Sayre’s Law is evident in the intensity and coverage of the Magill and Gay fiascos. Conservatives understand that there is something at stake here, but they do not understand what it is. Let me explain.

Car Dealers vs. New Dealers

The source of this ignorance is what I call the “Car Dealer vs. New Dealer problem.” Most American conservatives are middle class or aspire to the middle class, and, as a result, share a “car dealer” view of the world. The car dealer is a successful business owner. He is usually one of the wealthier people in town, and he makes other people rich too—by advertising on local media, hiring employees, and investing in local enterprises. To ensure success, the car dealer must constantly manage finances by finding new investment opportunities and cutting losses. That means gathering market data, firing underperforming staff, and seeking out innovation for increasing sales. The car dealer provides for the common good of those around him because of self-interest, and he assumes that others do the same. This worldview could not be worse for succeeding in higher education. Why is that?

Car dealers cannot commit to anything in the long term. Short-term losses are signals to the car dealer that it is time to pull up stakes and minimize losses, and the costs imposed on those affected are simply part of how the world works. This mentality is what often prevails among American Christian higher education institutions. If we view higher education through the car dealer paradigm, education becomes a service for sale, while students are the consumers, administrators the management, and faculty the labor. Under this model, the primary source of income is tuition, so tuition dictates low-prestige education that diverts the college away from its mission. Meanwhile, faculty in prestige-generating majors are sidelined, encouraged to retire, or downsized.

Most conservative colleges are Christian liberal arts colleges, many of which are struggling to stay afloat. At these struggling American Christian colleges, the majors in greatest demand are primarily in education, business, and nursing—the fields that appear to have the readiest application to real-world employment. Hence, car dealer administrators will divert ever-dissipating resources toward these high-cost programs, often at the expense of the core liberal arts disciplines that are central to the stated mission of the college. Because leaders at Christian colleges do not coordinate decisions, they all make these same decisions at the same time, meaning that they are now fighting over the same students, which in turn means no one gains the enrollment bump they expected. Moreover, students in these majors often graduate into fields with solid employment possibilities and lower salaries. (A notable exception is nursing—although nursing is in greater demand outside of the areas where most Christian liberal arts colleges are.) I am regularly surprised by how little incoming students and their parents know about the demand for conservative graduates to work in prestigious, high-earning positions that would enable them to live religious lives. In my field of political science, the best guess students and parents have is law school, but they know nothing about think tanks, policy shops, staff work, or consultancy work. This universe simply does not exist for them.

Upon perceiving the college as a short-term loss, car dealers jump ship and move on to other, better opportunities but only after paying themselves handsomely for their failure. The faculty can do nothing about the remaining administrators (also paying themselves handsomely), and hence, are the ones on the receiving end of cost-saving measures such as department closures, canceled tenure lines, benefit cuts, and salary freezes. The faculty are not the ones responsible for the poor administration of the university, but they bear all the costs, along with the students who will lose opportunities to learn. Faculty have few opportunities for exit because of a bad job market provoked in part by the number of American Christian colleges and universities that are experiencing this problem. Even if a professor manages to exit one struggling institution, there is a good chance he will just end up at another one. Anyone who has run a search committee in the past couple of years will have seen many applications from associate and full professors writing pleading requests to get out of a near-bankrupt institution that blew the endowment on a boondoggle four years and two presidents ago.

New Dealers do things differently. They are not normally Christian or even religious (unless one counts Wokeness). This gives them an advantage because they can turn to government money for long-term development of their institutions without concern for church/state separation. This advantage is one I will not focus on, but it is worth noting, since securing government funding was the starting point decades ago for proponents of the original New Deal.

New Dealers focus on institution-building in the long term. According to the New Dealer approach to higher education, education is formation, and students are investments, administrators patronage appointments, and faculty the face of the institution. Under this model, donors are the primary source of income. 

The New Dealer institutions secure donors by investing prior gifts into prestigious ventures that draw in more competitive students, foundation gifts, and faculty. The nominal tuition is not a source of real income; rather, it is a signal of the value attending the institution provides. In fact, some wealthy, prestigious universities could do away with tuition altogether, but there is no reason to give up this revenue stream. The students become future donors who fund the prestige of the university, and they are formed in a way that integrates students into high-prestige placements that make it easier for them to earn salaries to make such donations possible. All the while, New Dealer institutions hire grant writers to work with faculty to procure research grants that then become an additional basis for prestige. That, in turn, draws in more competitive students (or, as the institutions see them, future high-prestige graduates and donors). These students then work with faculty in the projects these grants fund and thereby prepare them not only for their field but also in the methods for procuring resources to work in the field.

The key to the New Deal approach of higher education is recognition that there are two economies at work. There is the financial economy and the prestige economy. The financial economy of the institution serves the prestige economy, and the prestige economy multiplies the financial returns at a much higher rate than the car dealer approach. There is an upper bound for what any institution can charge for tuition, but no such limit on donations from loyal alumni. 

For example, assume that a university has 1,000 students and applies a sticker price of tuition and board at $20,000. At full enrollment, then, the university pulls in $20,000,000. However, few students will pay that amount, as admissions needs to lower prices to compete with capable students. The rate at which a university lowers the tuition is called the “tuition discount rate.” Many conservatives like to point at sky-high tuition and mock it as a poor value for the money, but this mockery reveals a fundamental ignorance: no one pays the sticker price except, perhaps, foreign students, who are often wealthy or receive subsidies from their home country. The tuition discount rate can vary from institution to institution but can be as high as 40% or 50%, meaning that this $20,000,000 is never realized. Institutions must bid down their tuition to draw in students, meaning that the tuition necessary to sustain the institution is rarely enough given the fixed costs that come from running a college or university. The focus on tuition is therefore a deeply mistaken one.

Car dealer institutions have sought to increase student count by moving online. The problem here is that online courses are prestige killers. To go online, moreover, is to give up on the idea of student formation, treating them primarily as a source of income. Some online programs are useful, especially in the mathematical and computational fields that are conducive to online instruction. There is a problem, though; most Christian colleges are not engineering schools. Hence, the move online usually signals that the school is in financial trouble while also guaranteeing that it will remain so because of the tremendous loss of prestige. Other online programs are useful for professionals who need to continue coursework to keep their licenses. In these cases, however, students are less interested in the community and formation of college life, since they are older and established. Moreover, online markets are already matured, with key institutions like Liberty University dominating the market. The opportunities here are too limited.

Prestige, on the contrary, signals not merely a return on investment but membership in a respectable class of educated people with a purpose in life. For secular New Dealers, this amounts to piously woke experts joining the policy work, non-profit, management consultant, and investment bank positions. For Christian colleges, prestige would obviously look different, pertaining not only to things of this world but also of the next. And alumni support would not consist merely of money, but also in service to the institution’s mission. Christian colleges rightly care about the faith and formation of clergy, as well as preparing the laity for their roles as parents, aunts, uncles, and caretakers to the least among us. Even though these institutions would necessarily take a different approach, they cannot do without prestige in some form. For this to work, it would mean developing a separate conservative prestige culture, at least in the short term, as progressives possess a stranglehold on what already exists. Donations, then, should be to shoring up Christian institutions to pursue less tuition-driven programs in favor prestigious ones in law, economics, and theology to draw would-be conservative elites to work in conservative elite institutions. The broader vision of this is too broad for this article, however. 

Is a Prestigious Conservative University Possible?

The car dealer is good at finding deals, so why won’t he pick up the prestige approach of the New Dealer? There are several answers. The most defensible reason is a real concern that adopting the New Deal approach amounts to abandoning the college’s religious mission. After all, some mid-century religious colleges did precisely this, such as Emory and Duke. But those examples may not be as pertinent as they first seem. Those institutions were often theologically liberal and simply unconcerned about losing their religious identity and mission. That does not have to be the case for contemporary Christian colleges. 

Another reason the car-dealership university does not see the value of the New Dealer approach is that it is simply unable to engage in the long-term institution-building necessary to follow this plan. These are the colleges likely to close. For them, it’s simply too late. A worse reason is simply that no one in the college leadership, whether in administration or on the board, has any idea that the New Deal approach exists. The worst reason is that the car-dealer president has purely mercenary motives for taking over a Christian college—to pay himself until he is fired. These presidents are the result of college board members at Christian colleges having no idea what they are doing. They do not know what they are doing because none of them are academics, and they do not want to listen to academics because they are merely labor, and ideologically and religiously suspect labor at that. Hence, they do not learn and do not want to learn from their mistakes.

The American higher education landscape is largely divided between two types of institutions: struggling mission-driven or formerly mission-driven colleges trapped in demographically shrinking parts of the country, and high prestige, secular colleges and universities sustaining themselves on tuition, alumni donations, foundation grants, and interest on endowments. This state of play is not inevitable; it is not the result of external social forces like liberalism, late-stage capitalism, or some other nefarious Hegelian geist. No, the conditions of Christian higher education are the result of leaders in Christian higher education. They might not have intended the aggregate outcome, but their collective decisions have produced it all the same. 

Tessier-Lavigne, Magill, and Gay resigned because they threatened both the short-term money and the long-term prestige of their institutions. The latter is the much greater harm, as prestige exists in the opinions of persons rather than in the cash at hand. As Helen Dale argued recently, holding onto prestige is difficult, and losing some increases the probability that one will lose it all. For a month, Harvard University was best known as a place where (not for the first time) Jewish students were unwelcome. Gay’s resignation will likely put that to an end, but even this is not certain, as we await her replacement.

The likely result will be that the donors who sat on the sidelines will resume their annual giving, and grants will continue to flow into the faculties and graduate students at these universities over those of less prestigious conservative Christian schools. Whoever replaces Gay will not be, on his or her own, enough to change an entire institution, meaning that this money will continue to be wasted except insofar as it might help secure the individual conservative donor greater access to elite admissions, leaving conservative higher education the declining market share in educating future phlebotomists. As important as they are to health care, they do not run the country.