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The troubles of West Virginia University
Gordon Gee is a legend. That academia generated its own Gordon Gekko—a prince of leverage, a duke of reorganization—is no surprise. That the Great Author of the Universe decided to give my industry’s turnaround artiste the same initials as the leading capitalist of screen…well, everyone cuts corners a little.
Gee is a serial president of universities. He is back in the news because of developments at his current post, West Virginia University. A few months ago, economist Richard Vedder effusively praised Gee, his longtime friend:
If you had visited West Virginia University (WVU) 40 years ago, Gee would have been president. The same is true if you visited today. But in the four-decade interval, Gordon also headed two other flagship state universities: the University of Colorado and Ohio State (twice!), not to mention two prestigious private institutions, Brown and Vanderbilt.
Vedder had particularly nice things to say about Gee’s plans for West Virginia University: “it is time to downsize, to adjust to new realities of American (and, in his case, West Virginian) collegiate life.” Ah, that Gee: always thinking about realities and constraints. In an era of barriers to growth, from fertility to interest rates, it’s time for leaders of vision and foresight to impose austerity: rein in the faculty, purge the bureaucracy, trim the athletic fat.
Vedder wrote that just months before Gee’s master plan became clear. This past weekend, the details were revealed. Gee, in the last year of his contract, is considering eliminating nine percent of its majors, including all of its foreign language programs. In other words, Gee will almost literally decimate the academic offerings of WVU.
The outcry has been immense and immediate. Social media, at least the academic precincts of social media, has hosted expressions of outrage. I haven’t bothered to check the other quarters because I know what they’ll say: those lazy faculty, tough choices, online education, run it like a business, etc.
What I find interesting is how this is being framed: in terms of vast, impersonal structural forces. Vedder’s piece did this, avant la lettre, but so too does Gee and so do Gee’s defenders. Ironically, so do most of Gee’s social media detractors. One viral thread alleged that this was the realization of a dark conspiracy to destroy public education as a part of an authoritarian grift.
My friends. I’m a professional social scientist. I love vast impersonal forces. They explain a lot! But maybe this is the story of incentives at the firm and personal level—or at least this is a story about how one university and one particular leader interacted with those forces. Maybe this is the story of Gordon Gee, academic entrepreneur, who never bets his own money and always keeps his winnings.
The thing is that Gee is infamous. Not only has he long been a college president, he’s long been among the highest-paid presidents in the profession. In 2014, Slate reported his earnings of more than $6 million at the Ohio State University—an outlier year, but in 2003 he was already clocking more than $800,000 annually at Vanderbilt. Cruelly, 2003 is long enough ago that I have to adjust that number for inflation: it would be more than $1.3 million today. He earns about $800,000 a year in base salary at West Virginia now, although other sources peg his total compensation at more than $1.6 million.
And that’s just salary. Gee costs his institutions more in other expenses. OSU had to renovate the president’s residence to the tune of $2 million in 2007 (that’s a shade under $3 million today!). His post-presidential office at OSU cost at least $50,000 in renovations. And those look like bargains compared to his $6 million (again, just add a good deal to that for inflation) renovation of the president’s office at Vanderbilt.
In fact, these are the stories that explain why I know about Gee in the first place. He has earned, conservatively, tens of millions of dollars as a university leader, while saving on housing costs. He is one of the few non-sports figures (or non-Greg Mankiw figures) in the academy to have become actually rich from the academy—and mostly from public institutions, to boot.
I’m not going to assess whether Gee is worth it. Some at Vanderbilt praise his tenure for raising the institution’s profile, but my kneejerk reaction is always to assess the counterfactual. The beta returns on a premier Southern university in an era of easy money were probably pretty high to begin with, so who can say what Gee’s alpha was?
But if you’re a university trustee and you want your university to survive, even thrive, in challenging terms, Gee seems like a good bet. You’ll be judged on outcomes, and anything you can do to make success more likely will be worth it. (This is also why there’s no functional limit on football or men’s basketball coaches’ salaries.) Gee might be pricey, but he gets results, chief. Or at least he correlates with results, and in a noisy environment what are you going to say differently? So pay for his salary, his retinue, and his mansions—if the university succeeds, that’s going to be peanuts.
The Chronicle of Higher Education suggests that this was pretty much the thought process behind Gee’s hiring and his first decade on the job. Before Vedder was praising Gee’s austerity (for everything except, you know, his own salary), Gee was trumpeting plans to bring in ten percent—fifteen percent—twenty percent more students, revitalizing WVU and putting Morgantown really on the map. Gee’s gambit was that investments in athletics, buildings, and creature comforts would draw in international and out-of-state (read: full fee-paying) students.
Along that process, however, came retrenchment in the core function of the ideal university: instruction, research, and public service. As the Chronicle reports:
Though the main campus reportedly netted an additional 1,400 faculty members from 2010 to 2019, during that same period its spending on instruction, research, and public service declined by an inflation-adjusted $119 million, according to disclosures it made to the federal government. In fact, the university’s overall spending on employee compensation actually fell slightly between the 2011 and 2020 fiscal years, from $834 million to $806 million (inflation adjusted).
And remember that was before the most recent proposed cuts.
What does this story look like? It looks like a bet by trustees using other people’s money that Gee could use other people’s money to turn WVU around. It is, in other words, a variant of gambling for resurrection. And here’s where those big impersonal forces come back in. You don’t gamble for resurrection if everything’s okay. You gamble if it seems to you—maybe for sound, maybe for panicky reasons—that business as usual will lead to a steady collapse.
But it is a gamble. And ultimately Gee was gambling with other people’s careers. The faculty and staff who will lose their jobs because his bet (which, to be clear, I think was bad) didn’t pay off will pay for his mistakes. One of the reasons why the conspiracy explanation attracts so much support is that it’s line faculty, not senior administrator, losing their livelihoods.
In fact, the conspiracy theory doesn’t make any sense. There are forces in the United States that dislike the faculty vision of higher education, but they’re not plotting in secret; they meet and act in the open, as with New College and Texas A&M. And this isn’t something where we have to look to nefarious consultants as Rasputins of the process. Consultants work for the czar, and higher ed consultants (as at Texas A&M) can often just launder what admin wants to do anyway.
It’s much easier to explain WVU as a confluence of weak trustees, a supersalesman president, and a business plan (such as it was) that harnessed the STEMdenista fixation of donors and parents in combination with the very real need of universities in a post-public funding era to attract mobile, affluent students. Cutting research and instruction wasn’t accidental to that plan; it freed up cash to chase those students by offering them what they really wanted (the nebulous “college experience”, a market in which Morgantown competes with Coral Gables and San Diego).
Gordon Gee will move on from his career. WVU may recover, sometime. The faculty who will be laid off will, largely, have to leave academia or take severe financial penalties (imagine not only going on this job market but getting to unload your house in the newly weakened Morgantown market and buy in this housing market). People like Vedder will have nice things to say about Gee—they always say nice things about the rich.
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