Last week, the Board of Regents for Iowa’s higher-education system announced the hiring of J. Bruce Harreld, a business consultant who lives near Vail, as the new president of the University of Iowa. During its search, the board, an appointed body, had interviewed notable candidates from the field of higher education, like the president of Oberlin and the provosts of Tulane and Ohio State, but in the end, they landed on Harreld, who isn’t well known in academic circles—or anywhere else, really. From 2009 to 2014, he lectured at Harvard Business School; before that, he held executive positions at I.B.M., Boston Market, and Kraft.
Among students and professors, the choice has been about as popular as the selection of the quarterback of the Iowa State Cyclones would have been. The faculty senate issued a vote of no confidence after the announcement of Harreld’s selection. A union representing graduate students who work as teaching and research assistants wrote that the regents were going to “destroy public education at the University of Iowa.” Current professors and former students have written scorching articles. And the university’s chapter of the American Association of University Professors said that its members join everyone else in “deploring” the hire and the process that led to it.
The reactions, strong as they were, didn’t surprise anyone who had been watching the search. Harreld’s inexperience in higher education, along with the regents’ apparent interest in his business background, had rankled people; many were also unimpressed by his performance in a presentation to community members, in which he had come across, at moments, as bristling or dismissive. Harreld’s appointment was also only the latest in a series of tense encounters—in Iowa, and around the country—over two competing visions of how financial considerations should influence the future of higher education.
At the University of Iowa, which has more than thirty thousand students, Sally Mason, the outgoing president, had clashed with the regents over such matters. In 2012, the board decided not to renew her contract, though she continued working without one until announcing her retirement earlier this year. A particular source of tension had been the University of Iowa’s funding relative to that of the state’s two other public universities, Iowa State University and the University of Northern Iowa, which are governed by the same Board of Regents. The board sees its mandate as being focussed not only on education in general, but on the education of Iowans. Over the past several years, Iowa State and the University of Northern Iowa have admitted increasing proportions of Iowans, while the proportion at the University of Iowa, the state’s flagship, has declined as it has admitted more out-of-state and international students. In keeping with their Iowan-focussed mission, the regents had recently sought to increase funding for those universities more than for the University of Iowa.
This has been unpopular in Iowa City—an additional squeeze during a generally difficult time for public universities, which rely mostly on state funding to cover their expenses. This revenue source’s share as a percentage of university funding dropped twenty-four per cent between 1989 and 2014, and experts in higher-education finance expect the decline to continue, as bigger proportions of state budgets go toward areas like health care and pensions for state employees. In the past, universities made up for declining state support by hiking tuition, the second-biggest source of funds; over all, they more than doubled tuition over that recent twenty-five-year period. Recently, however, public angst over the expense of college for students and their families has shamed universities into trying to keep tuition down.
That means their administrators are faced with a difficult problem: how to keep their budgets balanced as their two main sources of revenue stagnate or shrink. In a phone call, Bruce Rastetter, the president of Iowa’s Board of Regents, described this dilemma as being central to the decision to appoint Harreld. (Rastetter, a champion of Harreld’s, himself has a background in the pork and ethanol industries; an article in Politico, in March, called him an “agribusiness mogul” and a political “kingmaker.”) Universities’ current dependence on state funding and tuition isn’t sustainable, Rastetter said, adding that the question of “how universities can generate more revenue outside of tuition increases and state appropriations” had been especially important in the search for the University of Iowa’s president.
Rastetter’s implication, of course, is that a former business executive might be better equipped than a lifelong university administrator to discover new revenue sources and contain costs. Harreld does have considerable experience along these lines, if in a totally different setting. At I.B.M., in the eighties and nineties, he was responsible both for cost-cutting and for finding and overseeing “emerging business opportunities” that could generate more growth—the latter, especially, being an important job at a time when I.B.M. was bogged down with sluggish holdover businesses from the seventies and earlier. Among the new businesses was a very successful consulting group focussed on the open-source software Linux. In 2005, Alan Deutschman, writing in Fast Company, called Harreld’s track record with those emerging businesses “remarkable.”
The question is whether his experience will prove useful in an academic setting. Harreld hasn’t laid out the specific measures he would take to raise revenue or cut costs—he couldn’t be reached to comment for this piece—but, during his application process, he said to reporters and in public forums that he was looking forward to learning about the workings of the university and that he would collaborate with professors and others to come up with decisions that would serve the campus well. I asked Rastetter what kind of revenue-generating and cost-cutting measures he himself favored, and he mentioned investing in online learning—a controversial approach that can let professors reach more students at once but is seen by some critics as less effective than traditional pedagogical methods—and trimming expenses in administrative areas such as finance, human resources, and I.T.
It seems conceivable that Harreld’s experience would be helpful on these fronts. Still, there’s little precedent for installing someone like him at such a large public institution. In 2011, fewer than two per cent of newly appointed university presidents came from private business, according to a survey by the American Council on Education. When I asked Rastetter to name some similarly non-traditional appointments at other high-profile universities, he referred to the president of Purdue, Mitch Daniels, who is the former governor of Indiana, and the president of the University of Oklahoma, David Boren, who is the former governor of Oklahoma. Janet Napolitano, the president of the University of California—the largest university system in the nation—also has a background in politics, having previously served as the U.S. Secretary of Homeland Security, under President Obama, and as the governor of Arizona. Daniels, Boren, and Napolitano lacked direct experience in higher education when they took their current positions, but, as former governors, all three were required to be deeply knowledgeable about budgeting for higher education, and experienced in the highly political, consensus-based decision-making processes that prevail in both statehouses and university administrations.
Perhaps the highest-profile model of someone with a business background running a university is John Hennessy, the president of Stanford. In 1984, Hennessy co-founded a startup that designed microprocessors, then afterward spent several years at Stanford, eventually becoming the chair of the computer-science department, then the dean of the School of Engineering, then the provost, before taking over the presidency. I attended Stanford as an undergraduate and arrived the same year that Hennessy took over from Gerhard Casper, a career academic who had taught law and political science; I remember some anxiety over whether Hennessy, who was close with Silicon Valley power brokers, would turn the university’s students into a farm team for his friends’ companies, at the expense of a traditional liberal-arts approach to education. Indeed, under Hennessy’s tenure, Stanford’s focus on engineering—and, in particular, the kind of engineering skills that can land a student a job at a Silicon Valley software firm—has deepened, attracting criticism from some quarters; Nicholas Thompson, writing in 2013, compared the university to “a giant tech incubator with a football team.” At the same time, Stanford’s finances are now healthier than ever; the university has annual revenue of more than five billion dollars, up from less than two billion dollars when Hennessy took over as president.
Still, Kembrew McLeod, a professor of communication studies at the University of Iowa and a vocal critic of Harreld’s appointment, expressed skepticism that an approach borrowed from business could help address the problems of a budget-challenged campus. “Universities are one of the few areas of American culture—and, really, Western culture—where market logic doesn’t trump everything else,” he told me in a phone conversation. He meant that, at universities, decisions are—or, in any case, should be—made in service of improving students’ education, rather than maximizing revenue or minimizing expenses. As an example, he mentioned the Iowa Writers’ Workshop. (I attended the Workshop from 2008 to 2010, during Sally Mason’s tenure as president.) The workshop doesn’t generate much revenue for the university; its students don’t produce valuable R. & D., and their tuition tends to be covered by financial aid. Pure market logic might suggest that the program isn’t valuable, McLeod noted, but, of course, the program has cultural value that isn’t quantifiable. “There are many other examples of programs within universities that aren’t obvious revenue generators but nevertheless contribute in the long run to the health of our society.”
While McLeod is suspicious of Harreld’s business background, he did acknowledge that universities—his own included—need to adapt to difficult financial conditions. He wasn’t quite sure how he would propose to do that. One alternative, he said, might be “for upper administrators to take a long, hard look at the mirror and look at the salaries that are paid to these upper administrators.” Harreld, he pointed out, will make five hundred and ninety thousand dollars a year.
