By David B Laird Jr

President, Templeton Laird


Most commentators expect the foreseeable future to be dominated by the impact of accelerating change, characterized by technological change, globalization, and climate change. Nearly all agree that high quality higher education will be a key resource on both the national and state levels.


Within that context what will be the most significant policy challenges for Higher Education? To address these challenges college trustees, presidents, elected leaders, faculty leadership, and donors will need to develop and maintain an adaptive course of significant change while securing quality and integrity. The identification of policy options and subsequent decisions need to occur within the framework of broad policy goals supported by continuous research and analysis.




Within this context what are the Strategic Questions for leaders:

  • Given the pace of change and growing competition, where will leadership for higher education emerge?
  • Given the dramatic changes in national and regional demographics, how will higher education respond?
  • In a period of dramatic and sustained change, who will be educated and how will it be funded?



While this paper is focused on Minnesota all states will experience variations on the categories which follow and no states will be immune from major effects of the changes.



A common theme among demographers is that demography is destiny unless organizations plan for that which can be anticipated. Minnesota is currently in a period of significant demographic change which will affect nearly every function of the State. Although much of the change has been documented and  known to be coming and ignored by political and most educational leadership,  adaptation has been delayed and modest responses have been insufficient.


For instance:

  • Age – without a major influx of younger immigrants, Minnesota will continue to grow older and poorer. Although much attention was paid to the baby boom generation, scant attention was given to the decline in birthrates which began in the late sixties and continues today, most pronounced among higher income white cohorts.
  • Diversity – nearly all of the growth in Minnesota’s population in the next two decades will be among  families of color and immigration families. ( See Nathan Grawe “Demographics and the Demand for Higher Education” ) Minnesota continues to be a welcoming state for immigrants from around the globe, including significant numbers from refugee communities. Historically these populations have been a source of economic strength throughout the Minnesota’s different economic sectors. External global events (war, weather, internal rivalries, and religious conflicts) have had and will continue to have unanticipated effects on the pace and extent of in-migration.
  • Incomes – In the past three decades there has been a major and growing income gap  characterized by growing income inequality overall and extreme inequality among racial and ethnic groups throughout the Minnesota’s population and  the nation generally. Minnesota’s gap is among the most significant in the nation and affects access to many of the critical functions and services for lower income people and families. Programs of assistance are insufficient and are expensive especially for the State and counties.  Many families continue to experience the complex impacts of the most recent recession which will have a negative effect on decisions about college attendance and how to finance it well into the future.
  • Education Success –  Minnesota also has major gaps in success rates in all levels of education, especially among students of color and low income groups. These gaps are closely correlated with the factors affecting income disparities.
  • Impacts on Higher Education – Each of the demographic factors mentioned above have and will continue to have significant impact on access to and performance of those attending institutions of higher education and the institutions themselves. The concentration of significant changes in these factors will have a compound impact on major functions of institutions and those wishing to attend them. As the demographics of future potential students are altered the admissions process will be heavily affected as will the current pricing approaches. The distribution of institutional and government subsidies will need to change substantially absent major increases in private philanthropy or government support or both. (See Jon McGee “Breakpoint The Changing Marketplace for Higher Education“).

Collectively it will be necessary to install new definitions of quality performance in institutions and individuals. Improvements in individual performance may need to be measured over a career rather than the first year following graduation or completion. Institutions are living in a time warp in which institutional quality is largely measured by the characteristics of incoming students (test scores, class ranks and sports records) rather than the long term impact of their college or training experience.



  • Boards – Few boards are leading their institutions in policy discussions as preparation for rapidly changing demographics of future students and factors affecting the success of these students. Current board memberships are generally weak and obsessed with micromanaging administrative activities, sports programs, and fundraising for buildings. (See Kenneth N Dayton “Governance is Governance” )
  • Senior Leaders – Most presidents and their senior staff are consumed by protecting the status quo and hesitant to provide leadership for confronting challenges of the future. They avoid the difficult tasks relating to the measurement of the quality of education provided to students and the necessary comparative research to measure the value proposition. However there is scant reward for bold leadership, advocacy of major change, and consistent research to identify current performance and needed change. Among those institutions that appear well off at the moment, the pressure against consideration of major change is immense.
  • Faculty Leadership  – with few exceptions, current faculty leadership in public and private non-profit institutions is clueless, kept in the dark about budgets and priority setting, fearful, and in denial about the changing environment in higher education, in Minnesota, nationally, and internationally. Substantial change requires faculty buy-in, both in diagnosing challenges and evaluating options.
  • Government and Political Leaders – In the past three decades government and political leaders have moved away from a past practice of reaching decisions within an overall policy framework. They avoid issues relating to the measurement of quality and success. They exhibit declining interest in difficult issues relating to the distribution of public subsidies. However driven by social issues, they are not reluctant to limit the ability of researchers to follow evidence into delicate issues. They too are ready to protect the status quo and avoid the difficult decisions relating to changing needs and educational results. Often forgotten is the reality that decisions based on political imperative are destined to be short lived and usually fail, resulting in significant  difficulty for institutional leadership attempting to engineer major change over time.



In conjunction with competing pressures for more service at lower costs, state governments have been reducing current and future funding for higher education. This pattern has resulted in a decrease in policy driven commitments, the starvation of infastructure needs, a tendency to equalize funding levels rather than making qualitative  judgements, and  a general interest in politically driven micromanagement.

In the absence of continuous statewide planning based on rigorous research and careful tracking of rapidly changing economic demands, higher education will struggle to fulfill the needs of future students and an economy in the most dynamic conditions since World War II.



Real competition for traditional higher education has been growing rapidly for at least three decades. The sources include for profit institutions, targeted on line services, new institutions, competency-based skill recognition,  in house business services for employees, and broad increases in nationally supported higher education institutions in more than a dozen countries. Headline developments have occurred internationally in more than a dozen nations in fields as diverse as high tech, medical, research, agriculture, science, along with the attraction of quality faculty and students. (See the annual World University Rankings by Shanghai Jiao Tong University. ) Recent radical change in immigration policy and enforcement is dramatically increasing international competition and reducing international enrollments in the U.S. A key area to watch in the future is the further development of research and implementation of Artificial Intelligence.



State  Leaders

  • Establish a semi- independent statewide planning commission for higher education with internal research capacity.
  • Create a rolling statewide plan to meet changing higher education needs (both economic and general).
  • Move to a distribution of state appropriated subsidies based on priority and established need.
  • Hold governing boards responsible for institutional quality and fiscal integrity.

Institution Leaders

  • Develop comprehensive assessments of the actual and documented
  • quality of institutional services.
  • Adjust pricing to reflect quality and clients served.
  • Adjust costs to available  resources.
  • Establish policies to adapt to changing economics and demographics.
  • Maintain a comprehensive Risk Management Plan reviewed and approved by the Board.
  • Create a non profit family financing plan for higher education.








By David B Laird Jr

President, Templeton Laird


What part should borrowing have in helping students attend and succeed in college?


The coming year looks like another banner year for student loans. In spite of low inflation and interest rates and continuing low growth in family incomes, tuition increases are expected to be in the 3 to 5 percent range, well above growth in family incomes. Two years ago student loan borrowing became the largest component of national consumer debt and in the last six years defaults on student loans have doubled. As a result of changes in federal student loan programs, they have become one of the largest profit centers in the Federal budget. There is legitimate concern that student loans have made the entire college finance system less sustainable. While some students graduate with reasonable levels of debt, many others leave college with an unworkable yoke around their necks which has a negative impact on personal and regional economies.


The annual ritual of fixing tuition and aid policies by boards needs to be a more strategic exercise. Trustees can work on policies that balance institutional and student needs or they will find themselves without a market. Part of the exercise must be a careful consideration of the ideas that will reduce the reliance on student debt and encourage student borrowers to repay their loans. At the same time it is reasonable to look to state and federal governments to generate moderating repayment programs and to target subsidies to professional and graduate programs so vital to our economic stability and competitiveness.


How should colleges and universities, led by their boards, make a difference in this complex situation?


  • First, they need to rethink their assumptions about the financing model they use for setting tuition and financial aid while actively exploring alternative models. Based on the rich diversity of American Higher Education, one size will not fit all institutions.


  • Second, colleges and universities need to offer students and their families access to comprehensive and timely advice about how to manage their student loan debt. This should be an integral part of the admissions process and should be available from the initiation of loans through repayment. The software for this analysis and advice is generally available and affordable.


  • Third, as part of the reassessment of their financing models, colleges and universities need a comprehensive and inclusive approach to controlling long term costs while increasing the quality of services.


Although hope for political assistance is hard to locate in the current dysfunctional political environment, only a comprehensive approach to these vexing challenges with bold Board leadership will reduce the pressures for student borrowing and set us on a path to better serve the changing student cohorts of the future. This will require an “all hands” approach. Trustees in the past have faced similar challenges and have overcome them, we should take confidence from the history and strive to match their performance.


David Laird in post-retirement is focusing on major higher education policy and financing issues. In his forty plus years of service he has cofounded a number of programs to assist students and their families as well as the institutions they attend. He has served as financial advisor for more than one billion in financing student loans and campus facilities, while helping to sustain one of the nation’s need based grant programs. He currently serves as Trustee Emeritus of St Lawrence University and a Director of the National Student Clearinghouse Research Council. The associates of Templeton Laird  have nearly two hundred years of service in higher education.


By David Laird

For more than two decades analysts have warned that changing demographics in higher education would induce major changes in institutions and their roles in our culture and economy. We now see the first wave of those changes in the projections of high school graduates through the next decade.

Higher education leaders who are hesitant to take unprecedented moves in the current marketplace may be limiting future choices while compounding the effects of major challenges. Below are some of the collective challenges which leaders and their boards should not overlook when establishing or adapting their strategic plans for the next decade or two.

High School Graduate Projections


Twenty-five states are projected to experience declines in high school graduation rates of 5 to more than 15 percent due principally to declining birth rates in the white population – rates that have remained below replacement rates for about twenty years. Only eight states are projected to show growth over the next decade. The states projected to decline also are states where retirement of baby boomers will leave significant gaps in the ranks of professionals.

Looking over the horizon, America’s changing population rates by race and ethnicity will alter the nation in many direct and subtle ways. As the principal source of well-educated leaders, professionals and high tech workers, higher education will be directly in the path of waves of change.

America's Changing Population

The increasing demand for more well-educated college graduates will focus on high school preparation and the financial ability of families to bear a realistic portion of the costs of higher education. There are a number of promising programs designed to help students (especially low income and minorities) prepare for success in college, but none have been tested on a statewide or national scale. As these adjustments were gaining traction, the recession beginning in 2007 blew a big hole in family net worth and state budgets. The recovery has been slow and variable, which leaves our economy and lots of institutions in a fragile condition if another recession occurs as predicted by many.

Family Net Worth

As U.S. higher education has struggled through the developing challenges and changes. A quick look at one of the comparative measures used to evaluate national efforts and relative success, suggests that the U.S. has held steady while a number of our international competitors have been gaining ground.

US Degree Production

The quick summary is that the U.S. higher education enterprise is facing a handful of intersecting challenges in demographics, preparation for college, general economics, family finances, government support, and growing international competition.  Unlike some challenges of the past, which responded well to single dimension adjustment, institutions need to address most of the present amalgam of challenges with comprehensive strategies that will require constant adjustment. Presidents and Board members should select and train their leadership team to constantly evaluate changing risks, substantially increased competition, modest financial margins from which to fashion change in their financing model, and a rapidly changing precollege population.

By Jon McGee

I studied political science and history in college. One of my brothers studied English. Another studied art history. The current conversation about degrees earned in liberal arts fields suggests that while we may be well-educated, maybe even interesting people, we also must be mostly unemployable in a contemporary economy. Social commentators today are quick to suggest that the future belongs to those with highly specialized skills and knowledge. A recent Star Tribune editorial applauding the rapprochement of MnSCU leadership and faculty asserted that “employers…need workers with technical and professional competencies as well as the ‘soft skills’ that liberal arts study imparts.”


We do students a grave disservice when we relegate the liberal arts, typically code for study in the humanities and social sciences, to afterthought. The idea that college ought to focus on the development of specialized and technical skills, and that the skills imparted by study of the liberal arts are just “soft skills” is simply wrong.

The liberal arts often are described as the opposite of a “practically oriented” education. The sentiment typically is expressed through the question, “What can you do with that degree?” Art history, political science, English. Dead ends, all. Only my own experience suggests that nothing could be further from the truth.


The best definition of the value of a liberal arts experience I have ever come across came from MnSCU Chancellor, Steve Rosenstone, when he was dean of the College of Liberal Arts at the University of Minnesota. In a 2001 essay entitled The Idea of a University, he described a liberal education as one that enables students to think critically and creatively, provides them with an understanding of the core ideas that shape the world in which they live, empowers them to see the connections among seemingly disparate things, and equips them to be lifelong learners. He got it right.


The ability to think critically and creatively, to solve complex problems, to transcend the boundaries of your own culture or experience are not soft skills, but rather imperatives for participation and leadership in a modern and rapidly changing world. The skills developed and honed by a liberal arts education are not transient but transferable and durable across a lifetime. They never become obsolete, unlike specialized knowledge and skills, all of which have an expiration date, sometimes sooner rather than later.


The liberal arts education my brothers and I received did not provide us with the particular technical expertise or knowledge required for any of the jobs we have had over many career years. However, it did provide each of us with the critical skills necessary to succeed in all of them.


A recent survey of our young graduates at the College of Saint Benedict and Saint John’s University confirms the contemporary value of the skills imparted by a liberal arts education. The overwhelming majority indicated that their education prepared them well for their careers and, as importantly, that their liberal arts education contributed significantly to their professional and personal development. They described themselves as very well prepared for the skills employers value most: the ability to perform their work ethically and with integrity, taking initiative, thinking critically about complex issues, and the ability to function effectively in a changing environment.


College cannot simply prepare graduates for specialized occupations and professions that already exist. That’s not enough. It ought to provide them with the skills to successfully navigate an economic landscape that will change frequently over the 45 year arc of their working career.


So, what can a liberal arts education prepare someone to do? As it turns out, lots of things. Goldman Sachs CEO Lloyd Blankfein, bestselling author J.K. Rowling, movie producer Steven Spielberg, Flickr founder Stewart Butterfield, and former Hewlitt-Packard CEO Carly Fiorina all earned undergraduate degrees in traditional liberal arts disciplines. It also prepares people for less famous but critically important roles, like school teachers, local business leaders, and legislators. Are the liberal arts a dead end? Not in today’s economy.

In the late 80’s the former Chairman of the Dayton Hudson Corporation, Kenneth Dayton produced the attached essay for the Independent Sector. It has become the classic guide for board members and their executives in the execution of their duties and responsibilities along with a formula for the division of authorities and responsibilities.

Click to read the PDF: Governance is Governance by Kenneth Dayton

We recommend reading this very nice piece by the Federal Reserve Bank of New York examining the benefits and costs of college, with the weight of evidence coming down firmly on the side of benefits.

An except from the article:

In recent years, students have been paying more to attend college and earning less upon graduation—trends that have led many observers to question whether a college education remains a good investment. However, an analysis of the economic returns to college since the 1970s demonstrates that the benefits of both a bachelor’s degree and an associate’s degree still tend to outweigh the costs, with both degrees earning a return of about 15 percent over the past decade. The return has remained high in spite of rising tuition and falling earnings because the wages of those without a college degree have also been falling, keeping the college wage premium near an all-time high while reducing the opportunity cost of going to school.

Click to download the entire article.

In “Reinventing College for a New Kind of Student,” Jon McGee talks with host Steven Smith about the major demographic, economic, and cultural forces pressing on higher education and their prospective impact on colleges and universities. He cites the imperative for meaningful differentiation in an increasingly crowded, changing, and competitive marketplace.

According to the Western Interstate Commission on Higher Education (WICHE) the number of graduates nationally began to decline slowly after 2010-2011. WICHE’s projections indicate that the number of graduates will continue to fall through 2013-2014, a reflection of the small decline in the number of births in the U.S. in the mid-1990s. Though not a particularly steep drop—the number of graduates is expected to decline by just 5.6 percent between 2010-2011 and 2013-2014 before slowly beginning to rise again—the recovery period will take years. The total number of high school graduates in the U.S. is not expected to reach 2010-2011 levels again until 2023-2024.

What this means for institutions is that a shift has occurred in the higher education market from one that is seller-centric to one that is tailored to the buyer. This changing marketplace clearly presents students and their families with new college opportunities. Oft-repeated tales of students who receive college rejection letters in spite of 4.0 grade point averages, high board scores and extraordinary high school vitaes are more myth than reality, generally true only at a small number of extraordinarily selective private and public colleges and universities. Most institutions have neither widespread brand recognition nor the luxury of excess demand. Questions about whether they make their class most often trump questions of who is in the class.

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