Progress Report :

DIRECTIONS FOR THE UNIVERSITY OF PENNSYLVANI AIN THE MID-SEVENTIE S

TO : The Trustees, William L . Day, Chairma nFROM : Martin Meyerson

Your favorable response at our October meeting to m ystatement of educational and related fiscal possibilities for ou rUniversity has served as a basis for subsequent deliberation swith faculty and other campus groups . There has been a mixtur eof interest and enthusiasm along with understandable anxietyabout these or any alterations . Hopefully the former reactionswill be enhanced and the latter allayed in the months ahead .

This much is certain— we cannot simply continue as before .There are not the resources to do so . Our endowment is onlyabout $10,000 per full-time student . Yale, for example, ha san endowment over five times as large per student as ours .The endowment per student at most major private universitie sis larger than here . Commonwealth subventions have com-pensated for our low endowment ; but the State contribution ,which represented 9 .3% of total operating expenses in fisca l1961, has in percentage declined since .

In the late fifties and the sixties under the leadership o fPresident Gaylord Harnwell and the Provosts in his adminis-tration, great advances were made . We developed an excellen tphysical plant . We moved from an inbred to a national an dinternational faculty . Student quality— particularly amon

g undergraduates— rose until 1968. We shifted from a largely non-residential to a residential campus . And yet, during this perio dof many gains, there were difficulties as well . Average facultycompensation at Pennsylvania in the fall of 1970 had de-clined over the decade to a point significantly lower than tha tat comparable institutions . Administrative salaries were tenthamong eleven major universities . Wages were but a littl ebetter . Our library collection— which had, for several decades ,ranked 10th in overall size— was 19th in 1970 . At the sametime, our commercial bank borrowings, which began to b esubstantial in 1963, rose until, in 1969-70, there was not amonth in which average borrowings were below $7 million .

Under these circumstances, we face three choices . First, wecould try to become a state-related university as did Templ eand Pittsburgh. There is no assurance, however, that theCommonwealth would agree to assume such a burden, whic hmight require $70 million or more of additional state expendi-tures . And if it did, it would mean the University of Penn-sylvania would become a local institution serving mainly loca lneeds, rather than a national university which has been asource of pride to both city and state . The days in which aWisconsin or a California was willing to invest in great cos-mopolitan university centers are over for now .

Second, we could choose what I have called the proprietaryroute . Just as proprietary hospitals rarely accept charitablecases or perform highly sophisticated types of therapy or con -duct research, so a university could move in such a path . I fthere is little demand for a complex subject, drop it . If re -search, even when sponsored, is costly, do not engage in any .Concentrate on students from prosperous families and on

January 12, 197 2

subjects with the lowest costs for equipment and instruction .Do not provide faculty salaries competitive with other institu-tions . Mediocrity would be the result of this option withou teven the assurance of fiscal viability . Why should students in -vest heavily in an education whose margin of excellence ha dall but vanished? We would, in effect, be trading a budge tdeficit for a quality deficit, one which would no doubt pro -duce losses in tuition income, gifts and grants, and Federa lsupport .

Despite the necessity for creating closer financial ties to th eCommonwealth and taking a variety of "proprietary" actions ,it is through a third option that the University can flourishas a major center of educational achievement . The thir doption is one which requires us to raise more new funds tha never before and to raise them primarily for qualitative im-provements in our educational programs .

Given the concern and sometimes suspicion directed to -ward higher education in recent years , there is no chance forthis option to succeed unless it is clear that 1) the Uni-versity is putting its own house in order financially and man-agerially ; unless it is clear that 2) there is a real determina-tion to reallocate existing resources in terms of articulate dpriorities, and unless it is clear that 3) those priorities wil lmake Pennsylvania far more outstanding than it is now i nlearning and research .

This last fiscal year 1970-71 was one in which through anumber of measures, including a freeze in hiring and cuts i nhospital expenses, we achieved a significant decline in rea lcosts. With inflation running about 5½ % in that period, ou rincrease of only 3 .2% in total operating expenditures i scommendable . According to available information, at Brownexpenditures increased 10 .2% in the year ; at Southern Cali-fornia, 9 .8% ; at MIT, 7 .6% ; at Cornell, 6 .9% ; and at Yal e4 .4% . Indeed, the only large private university we kno wabout which had a lower increase than ours was Princeton .

Yet 1971-72 will not be without setbacks . In May of 1971 ,it appeared likely that the Governor's request for the Uni-versity budget, $13 .9 million, would be passed by the legis-lature. On that expectation, this administration submitted t oyou then an operating budget totalling almost $190 millio nwhich included substantial increases for salaries an

d wages— increases we deemed essential to maintain the quality of th eUniversity . At that time, we anticipated a deficit of $1 mil -lion which compared favorably with the $1 .2 million defici tfor 1970-71 and $2 .3 million deficit for 1969-70 (before re -serves were applied to it) . With your concurrence, w egambled on State aid at the $13 .9 million level .

Unfortunately the Pennsylvania Supreme Court actio nagainst the graduated income tax , the subsequent related cutsby the legislature, and interest costs caused by delays in pay-ments from the Commonwealth have led to a deficit of a nadditional million dollars for 1971-72 . I should point out tha tbut for increases in salaries and wages, there would be n o

ALMANAC SUPPLEMENT January 25, 1972

I

deficit for 1971-72 despite the cut in the anticipated Com-monwealth appropriation .

Even so, according to published reports, we compar efavorably with other universities. Yale's deficit was about$2 .5 million in the last fiscal year, and more in the curren tone. Johns Hopkins went through the fiscal year with a defici tof over $4 .5 million . Columbia has reduced its deficit fro m$17 million last year to $10 .8 million this year . New YorkUniversity's deficit is going up from $7 million to $9 .8 mil-lion . Stanford has projected deficits through 1975-76 . Syra-cuse has an estimated deficit for 1971-72 of $4 .7 million .

In the fiscal year ahead, 1972-73, our intention is to brea keven before the end of the year. There are, however, som emajor variables still to be resolved . Though we have guide-lines from the Pay Board on salaries and wages, we are with-out clear guidelines from the Price Board on tuition and fees .We also have no indication of what the Governor will recom-mend as the Commonwealth's appropriation for the Uni-versity, nor what the legislature will ultimately appropriate .

Nevertheless, by a continued freeze on appointments i nmany parts of the University, by seeking to maximize theamount of faculty compensation to be drawn from researc hcontracts or special endowments ; by a sharpened sense of th eactual financial need of students receiving aid ; by requiringthat all outside sources of such aid (for example, the Penn-sylvania Higher Education Assistance program) be exhaustedbefore applying unrestricted University funds and by placin ggreater emphasis on loans and jobs in the student aid mix ; byusing new Federal income for the health areas which is al -ready assured, we are moving to an improved financial base .

However, next year we shall face for the first time a deficitof up to $800,000 for operation of the new high-rise resi-dences . This is the first of a series of decreasing annual deficit sfor this purpose which were programmed several years ago .We shall recommend the total projected deficit be refinancedand converted to long-term debt which it properly should be .

We look hopefully to legislative passage of the bill we hav eproposed, permitting us to a limited extent to realize and us ecapital gains on our endowment as is being done in man yother institutions . When we succeed in achieving a balance dbudget by the end of 1972-73, I believe we will be one of thefew comparable institutions to have done so .

* * *

But just balancing the budget is not sufficient . I pointed ou tat our October meeting and have emphasized again abovethat if our University is to substantially increase its fundsfrom alumni, friends, firms and foundations, we must indicat eour readiness to reallocate our resources internally and t oconcentrate them and necessary new resources on future pro-grams which have high priorities . Because all these matter sare closely related, I shall deal with them in a linked fashion .

A. We have tremendous strengths in our professional fields .Post-baccalaureate curricula in the health professions, in law ,and in management, which are the largest of our professiona lfields, are among the best in the country . Their strengthsshould be reinforced and extended .

B. Because we have a campus with all its parts contiguou sand partly because we have an integrated system of govern-ance, we have a special opportunity to correlate our edu-cational programs : to infuse our professional programs wit hthe methodologies and knowledge of the arts and science sand to temper the arts and sciences with the insights an dsense of mission which the professions can offer . Educational-ly that interplay is important . Increasingly, societal problemsalso require the imaginative linking of diverse specialties .

C. It is fortunate as well that our University did no tsnobbishly eliminate (as some institutions did) undergraduate

professional programs, particularly in business and organiza-tional management and in engineering . These programs ca ncontinue to provide strong bases for careers and, equally im-portant, can increase their intellectual contributions to under -graduate general education and to other educational efforts .

D. Many undergraduate major programs in the arts an dsciences are excellent . An increasing number of undergradu-ates pursue course patterns that reach up to graduate offer-ings; some earn a combined bachelor's and master's degree .Transfer students should be encouraged to come here wit hthat attraction in mind . Beginning students who are equippedto start a field of concentration when they enter the Uni-versity should be permitted to do so readily . Students shoul dhave the opportunity to prove their mastery of a concentra-tion not necessarily by the accumulation of course credits, bu tthrough comprehensive examinations and also through inde-pendent research or other creative work .

E. For many beginning undergraduates, however, we re -quire a much more flexible and experimental curriculum . Ina number of areas we have begun such programs, but ou refforts must be expanded to include :

First year seminars to allow students to work with amember of the faculty in a small group ;

A tutorial term in which a student can work with ateacher in an individual or group tutorial on problems t owhich they mutually agree ;

Thematic colleges , in which part of the student's work i sorganized around a theme or problem ;

Technological innovations such as video-cassettes (cover-ing lectures and laboratory demonstrations) which can b eplayed and replayed by students at will .

F. Our residence halls (including the high-rises) shouldserve as an educational asset and a basis for a "house system "for undergraduates and graduates . We require here, not asingle comprehensive house plan based on quaint Gothic o rFederal quarters, but a variety of living patterns which allowstudents and faculty a genuine choice . The success in develop-ing College House at Van Pelt House, in which the student sand faculty have created a varied intellectual and cultura lprogram, testifies to the possibilities of such an approach .

G. We have over sixty graduate groups offering Ph.D. pro-grams, considerably more than many comparable institutions .In only three fields, Spanish, anthropology, and pharma-cology, however, are we ranked by our colleagues elsewher ein the top five among the country's graduate departments .(We are in the top ten in seven other fields .) By spreadin gour resources thinly (a large proportion of these programshas been added in the last dozen years) we risk reducin gourselves to a position of mediocrity . A more desirable al-ternative is to emphasize selected educational and researc hstrengths . For example, three major constellations or axes i narts and sciences and related graduate fields where we haveimportant current strengths are : 1) socio-economic behavior ,2) the life sciences (including pre-clinical health sciences )and 3) the area of languages and cultures, e .g ., the ancientworld .

These three areas link closely with one another . By settin gour priorities in such directions we would not exclude workin other fields, but would seek that it be far more selectivethan it is . The Academic Planning Committee is currentl yreviewing and no doubt will modify and improve a proposedpattern of emphasis . Thus our emphasis might be on achiev-ing a superlative scholarly position (and with world ties) inas few as 12 to 15 graduate fields . Doing so does not, o fcourse, preclude a comprehensive set of undergraduate ma-jors, nor selective strengths in advanced work in other fields .

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ALMANAC SUPPLEMENT January 25, 1972

H. In addition, there are three interdisciplinary and prob-lem-oriented areas where we have strength and might wel lconcentrate resources : 1) urban, regional and environmentalstudies ; 2) the interface between technology and societ ythrough such problems as those in bioengineering, energy ,communications and transportation ; and 3) selected foreignarea and related international programs .

* * *

In brief sketch, these are major proposed priorities . Give nfrequent calls for a "new plan" for higher education, w emight be tempted to offer our own grand design encompassin gprecise goals and means and concluding with a full canva sof a distant future to be realized . I think we must resist thattemptation, for such grand visions have a bad habit of turnin gstale or, at best, of inhibiting necessary improvisations . But w ecan pursue sharpened goals . We can create opportunities forchange, and we can establish a climate hospitable to educationa linnovations of a kind that will make our University the mos tstimulating one there is for students and faculty alike .

To achieve such purpose will not be possible by realloca-tion alone. Necessarily, it will require a major UniversityDevelopment Fund, the principal components of which areoriented to endowment and operating funds for high qualit yprograms ; they are described below .

Educational Opportunities Fund

The attainment of specific program goals within the area snoted above will require varieties of support . For thispurpose, we propose establishing an Educational Opportuni-ties Fund to assist in efforts of demonstrated educational merit .This Fund should provide much impetus for innovation i nteaching and research . We hope to raise half of this Fun dthrough internal reallocations and the balance from outsidethe University . In broad headings, subject to further facult yadvice, we would propose to allocate these funds among th efollowing major areas : 1) Health affairs, tying together th ework of our separate professional schools ; 2) Undergraduat ecurricular development, including thematic colleges drawin gon all our faculties , first-year seminars, and tutorial terms ;3) Development of graduate superiority in 12 to 15 fields ,tentatively concentrated in socio-economic behavior, life sci-ences, language-culture studies (and reinforced by work i nthree cross-disciplinary fields : urban, regional and environ-mental studies ; the technological-societal interface ; area andinternational study programs) ; 4) Management, planning ,and policy fields in the Wharton School and elsewhere ; 5 )Legal studies ; 6) Human development studies such as thos ein education and welfare ; 7) Performing and visual arts ;8) Other presently unforeseen possibilities .

Teaching and Program Professorship s

During the rest of this decade we recommend seeking fund sfor one hundred professorships to help transform the veryterms of teaching and research at Pennsylvania, and in highe reducation across the nation . These professorships would b ewell endowed, not only for salaries, but more crucially, fo rthe provision of program funds . Such funds would be at thedisposal of the holder of each chair, sometimes to facilitat eresearch, more often to support educational offerings an dexperiments . Each holder of such a professorship should un-derstand himself or herself to be acting in trust for his or he rcolleagues and, in some sense, for students as well . The in-cumbents of these chairs would be obliged by the very free-doms and resources made available to rethink their teachin gfunction and to test new combinations of classroom style sand field experience, cognitive and affective techniques , learning

sequences and course conditions . They might alter thelength and intensity of the course unit, rearrange instructiona lroles, or multiply media or mentors ; they will be expected t oprobe deeply into pedagogical possibilities that may lead t oimproved educational modes that can stimulate others as well .Many of these professorships would be filled by those here ;others would be recruited from outside . They would be avail -able at assistant, associate and full professor ranks, most o fthem for limited terms rather than permanently .

Benjamin Franklin Scholars and FellowsCompared with similar institutions, we have few endowe d

or regularly supported undergraduate scholarships and grad-uate fellowships. Because excellent students— as much a

s colleagues— stimulate good teaching and imaginative research ,we propose raising funds to attract to Pennsylvania up to1,000 Benjamin Franklin Scholars and Fellows (about hal fof each) . Pennsylvania must remain a selective institutionwhose elitism refers not to the socio-economic background o four students, for these are varied, but to the intensity o ftheir commitment to rigorous education . Some may requireonly a small or token award, others substantial assistance .The distinction and recognition of the awards, however ,would be available to all . Our minimum aspiration for theBenjamin Franklins should be 5 percent of our student body .These awards would provide more permanent funding fo rsome of our extensive student aid programs .

Residential House Syste mAs mentioned above, we have the opportunity to develop a

flexible system of residential houses, many through combina-tions of floors in the high-rise residences (and not necessaril ypermanent combinations), others through the rehabilitatio nof the older dormitories such as the quadrangles . At any rate ,the key to a successful house system is less the real estateand more the faculty and masters who participate with student sin developing a cultural program to complement curricula rofferings .

Library FundIn this area, significant investment ought to be made t o

maintain and recoup past excellence . Where our collection sare now strong, we should make every effort to further en -rich them and keep them current . Where they are not strong ,we must enable our students and faculty to benefit fro mcooperative efforts with other libraries along the eastern sea -board . "Library" should be taken to mean a knowledgestorage and retrieval system including audio-visual media an dcomputer tapes and not only an assemblage of books, reportsand periodicals .

Endowed Lectureships and Visiting Artists, Scholars ,Professionals and Persons in Public Affair s

We have few of those distinguished lectureships or resi-dencies which bring the great minds and personalities of ou rtime to a campus . To enhance our curricular development ,we ought to have them. The presence of these colleagues wil lcomplement and reinforce established campus interests an dprograms and provide an important means of helping ahouse system flourish. It will further an intellectual atmos-phere needed to attract the ablest teachers and students .

Cooperative ProgramsWe suggest a goal of comprehensive distinction in a limited

number of fields and selective distinction in other areas . Weassume other distinguished universities, both here and abroad ,will move in similar directions . Pennsylvania should take thelead in developing cooperative programs in which individua l

ALMANAC SUPPLEMENT January 25, 1972

III

strengths are shared rather than duplicated, with some field sshared among two or more institutions . But more than fisca lsavings and coherent development is involved . Our faculty andstudents should be encouraged to broaden their experiences ,spending time at other institutions in the United States an dabroad . Parochialism must be supplanted by a sense of edu-cational universalism.

Internal Faculty and Student Research Foundatio n

We assume that the process of learning and the art ofinquiry are inseparable . At present, the University has a tin yprogram of grants for scholars of promise . That programshould be expanded with particular emphasis given to youn gpersons and to seed money for research and other creativ eactivity with an explicit teaching component . That seedmoney will, incidentally, often lead to extensive futurefoundation and government support .

Health Affairs Construction and Other Plant Improvemen t

I have said that in this decade primary emphasis shoul dbe given to quality and to people and programs . In the areaof health affairs, however, significant improvements in physi-cal plant will be required both for basic sciences and forpatient care . Some of our older buildings and some newe rones such as Dietrich Hall will also need to be refurbished .We shall seek to minimize the commitment of resources t obricks and mortar and concentrate our energies on the fulles tutilization of the outstanding complex already developed .

Continuous Educatio n

It is time to consolidate our efforts in adult and continuou seducation through a College for Continuous Education . TheUniversity should not remain the almost exclusive preserve o fthe young. Men and women with different experiences andclearer aspirations must be encouraged to become full mem-bers of the University community . We must also be certai nthat creating a separate college does not hinder the fulles tcomingling of students of different ages and perspective .

While the proposed College should be able to grant degrees ,degree-granting should not be its primary role . Its calendar,including use of campus facilities in the summer, shoul dreflect adult patterns of free and leisure time ; its programshould reflect adult needs, and not merely duplicate existin gcurricula redesigned for an adult population . It should b edirected both to career and non-career objectives and in som eof its aspects it should be fully self-supporting .

We should also extend our educational activities beyon dthe limits of our campus . Through an expanded Alumn iCollege program, sometimes tied to the professional andcareer interests of our graduates, on other occasions speak-ing to their cultural and avocational pursuits, we can mee tour goal of making a Pennsylvania education a life-time enter -prise . We also have an obligation to further some of oureducational services to constituencies in our Commonwealt hand City . Knowledge as a basis for public decisions would b ewelcomed by community groups and many urban and othergovernment officials .

These are proposed directions for the years ahead . Wit hthe campus community we shall now elaborate on these di-rections for strengthening the University and for renewin gmany of our forms of education, building on the progress w ehave made and are making . Our purpose is to seek counse land advice on improving these proposals during the nextseveral months, after which we expect to return to you wit ha set of recommendations for implementation . To set them i nmotion will require the largest fund-raising effort in our history-

a course not without major risks in today's environ-ment . At the same time, this course offers the best hope oflifting our University into the forefront of pacesettin ginstitutions .

The universities that have traditionally achieved pre-emi-nence have been committed to experimentation as well a sexcellence . They have periodically transformed themselves,both stimulating and responding to intellectual and socialchange . The University of Pennsylvania has done this i nthe past and must do so again .

My associates and I believe the following conditions pro -vide an accurate assessment of our opportunities :

1. That we must reinforce ourselves as an independentuniversity of distinction .

2. That our private status can be justified and sustaine dthrough development of improved modes of instruction base don the honored principle of talented students working i nmeaningful intimacy with eminent teachers, but which breakwith the patterns of the past in many important ways .

3. That our status is further justified by our continuin gcommitment to the generation of new knowledge and ou rrecommitment to the search for new insights about huma nand physical nature and condition .

4. That major new resources are needed if we are t odevelop these new capabilities .

5. That while Commonwealth and Federal funds are criti-cal, we cannot look to these sources by themselves for in -creasing our margin of excellence .

6. That tuition revenues cannot rise indefinitely .7. That the scale of our university in the near future is

determined by the size of our existing physical plant .8. That quality in our major thrusts will be enhanced b y

effective management, increased efficiency and operation o na balanced budget .

9. That the size of our resource base, even if expanded aswe propose, requires that we become a more sharply focusse dUniversity that can and will achieve national and interna-tional distinction in carefully chosen fields .

With these conditions in mind, 1 plan to create a Universit yDevelopment Commission, comprised principally of faculty an dstudents . Appointed by the President with the advice of th eProvost and Vice-President, the Steering Committee of th eUniversity Council and others, the Development Commissio nwill superintend the review and further refinement of thes eproposals . If you concur, it will have as ex officio membersthe chairmen of the three Trustee committees most directl yconcerned : Educational Policy, Development, and Long-rangePlanning. Three professors who are the chairmen of theAcademic Planning Committee, the Educational Policy Com-mittee of the University Council and the University Senate ,will also be invited to serve ex officio . A report from theCommission should be available by the time of the MayTrustees' meeting .

Such a Commission will work closely with the Office o fDevelopment, which recognizes that it must be able to orien titself to the fund-raising strategies appropriate to these pro-posals . Our deans and other academic officers must also workintimately with the Commission in the articulation of con-crete program proposals for support .

Seldom are institutions reorganized or reinvigorated fro mabove alone . The success of transformation and change, o finnovation and adaption has always required the continuin ginterest and energy of the whole community, both collectivel yand as individuals . My colleagues and I are summoning th ecampus to join together in this major effort . We shall needyour judgment, concurrence and participation .

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ALMANAC SUPPLEMENT January 25, 1972