The University of Michigan, an encyclopedic survey ... Wilfred B. Shaw, editor.

Financial Problems and University Quality

One of the products of the turbulence (although there were other contributing factors) was a loss of public confidence in higher education. This, in turn, produced a severe financial squeeze during the latter part of the '70's. Fleming foresaw clearly the financial needs (and later developments saw the adoption of some of his solutions) as he spoke of financing higher education:

Traditionally higher education has relied on four means of support: federal assistance, state and local support, tuition, and gifts or grants from private sources. The latter two have been instrumental in the survival of private higher education. Contemporary political and economic considerations have led to declining rates of support from each of these sources, and, coupled with the rapidly accelerating costs of higher education, have placed grave financial strains on colleges and

universities. In response, some advocate federal support through a national system of scholarships, or through formation of an educational opportunity bank which could lend money to students. All such proposals, since they award money to the student rather than the institution, would permit the use of federal funds to underwrite expenses at public or private schools. Alternative proposals advocate federal grants to individual institutions, or federal revenue sharing with the states who would determine the best use of the funds. The decision as to which, if any, of these proposals shall be adopted could determine whether existing prohibitions against the use of public funds for private institutions will fade, thereby creating a unified public-private system, or whether private institutions must uncover new sources of revenue or perish.

Throughout the remainder of his term, Fleming faced financial problems. In his 1973 "State of the University" address he pointed out that for years it has generally been agreed that the benefits of higher education accrue both to the individual and to the society, and that it is quite appropriate to split the cost between them. But, he warned, the proportions may be changing. While students now pay about 20% of the direct costs of their education at public institutions, the figure may rise to one-third or even one-half. "In an inflationary economy costs will rise steadily, and if the student is to assume an ever increasing portion of the total cost of his education the figure will be formidable by graduation time. Low-income families will either find it impossible to send their children to school, or will find a growing resentment on the part of the lower middle class when a means test gives outright grant money primarily to low income students."

Fleming warned further that attempts to standardize teaching costs at all state institutions, without regard for their different missions will lead to "a homogenization of all the universities," and could erase "the prestige and distinction which the University of Michigan brings to the state." He repeated his concerns with finances in his 1974 address, noting that the Governor had ordered a 1% reduction in expenditures, which had to be added to a budgeted deficit of some $645,000. He noted further that private and governmental support for research was dwindling. And finally, he noted with regret

that Michigan's tuition charges were the highest of all public universities. These increases helped finance salary improvement, but threatened to erode access and demand for admission. His concerns with the students' share of cost were justified. By 1976-77, student fees produced 33 % of general fund revenues, compared with 19% in 1956-57 and 25% in 1966-67.

His concerns were prophetic as to other sources of revenue, for in 1975 the University received a substantial cut in its state appropriation, to the point that the possibility of personnel reduction was considered.

But Fleming still characteristically dwelt not upon the problems of the past, nor even the possible gloom of the future, but rather upon the success of the University, the mission of the University, and the resolve to meet that mission. Even as he reported hard times to the faculty, he reminded them that "Every survey taken in the last 50 years shows the University of Michigan to be one of the very best of the American universities. More than anything else this reflects the stature of the faculty. We want to keep it that way."

The stature of the University was confirmed in a December, 1974 national survey of professional school deans which revealed that "five universities with outstanding reputations — Berkeley, Chicago, Columbia, Harvard and Michigan — have the greatest numbers of top-ranking professional schools." The University's School of Dentistry and School of Public Health were ranked first in the nation by the deans in those professions. The School of Library Science and the School of Social Work each tied for second in their professions. The Law School and the School of Music were ranked third in the nation.

Looking at the University's excellence and its pervasive outreach, President Fleming summed it up: "Whether we are talking of urban blight, environmental pollution, population control, resource allocation and conservation, mental health — name it — somewhere in the University of Michigan, someone is involved in the issue. Our task is to make that involvement as meaningful and beneficial to man and society as we can. We can do no more. Our purpose is to do no less."