(Introductions by Susan Harris and Joane Nagel)
Thank you very much, Susan, for that gracious travel-metaphor-laden introduction. It's a pleasure to be here, not just here at KU, but in this remarkable facility. We're lucky to have this place. This is a wonderful monument to KU's priorities and values. There are a lot of people at the University of Texas who would be envious to have a place like this.
I just came from a lunch with some of the movers and shakers of the Kansas City environment. We were talking about higher education in Kansas and about challenges, problems, and politics. I didn't learn a great deal new from that lunch, but one of the things that impressed me was these folks started talking about the advantages that Kansas has in terms of competitiveness. They talked about ethanol and wind power. They talked about prairie spirit and work ethic. They were working themselves into a frenzy of enthusiasm for Kansas, which was quite admirable. One of the things that struck me in this conversation, however, is they didn't talk about the greatest natural resource in this state, which is its young people's minds.
This is a natural resource, and we can look at it just as petroleum, uranium, and fish banks. It is an asset that is incredibly valuable. How we handle this natural resource, how we-if you want to talk in economic terms-exploit it is going to be the determiner of who is going to win in all of the conversations we have about global competitiveness, and that Tom Friedman has talked about. It won't surprise any of you if I claim, nor should it surprise me if you were to claim, that the key to exploiting this natural resource, to harnessing it, to turning it loose, to giving it its greatest possibility for benefit, is higher education.
In the context of globalization, maybe I should give you a little background about my own involvement in the commercial arena and in the global arena. Right after the Gulf War, I sent one of our junior colleagues to India. He was an expert on telecommunications policy. I sent him there to catch up on what was happening in the telecom world in India. When he came back, we went to lunch, and I said, "What's new in India?" He said, "What's new in India is cable television." At this time of the Gulf War, all of the media were completely controlled by the Indian government with the exception of the press. All broadcast media were controlled by the Indian government. There was a fifteen-minute morning news broadcast and a fifteen-minute evening news broadcast. That was it. The rest was how to grow apples in the Kashmir Valley and other riveting sorts of entertainment.
During the Gulf War, people had a vital cultural, commercial, and personal interest in what happens in the Gulf, particularly on the western side of India. They couldn't get information about what was happening. Someone discovered that if they bought a satellite dish they could get twenty-four-hour raw feeds from the BBC and CNN and monitor the situation in real time. Then someone inevitably discovered if they ran two wires off the back of that, they could share the cost of it with their neighbor. Knowing the Indian entrepreneurial spirit, it was probably fifteen minutes after that when someone said, "If we ran ten wires off the back of it, we'll have a revenue stream." Within six months 50,000 mom-and-pop cable TV companies exploded across the subcontinent. Fifty-thousand commercial enterprises just happened that never existed before. It was a completely unregulated environment. The Indian government did not anticipate anything like this. It was the Wild West.
I had the good fortune to know someone who knew someone and called the executive vice president of a company called General Instrument Corporations, now a subsidiary of Motorola. They are the largest manufactures of set-top boxes and cable TV equipment in the world. I called and said, "Do you know this is happening?" There was a long silence on the other end of the phone. He said, "Are you free on Wednesday? I'm coming down, and I want you to tell me about this." We gave him a four-hour seminar on what was happening in India and how to do business in India. We made that part up, because we didn't have a clue. As a result of that conversation, I ended up being in the business consulting industry in India on the information-technology side for twelve years. The hunger for knowledge about India and how to function in India translated itself very quickly into a responsibility for negotiating shareholder agreements and compensation and benefits packages for employees. I learned a ton in the course of doing business with India. It was like getting another PhD.
I also discovered very clearly what was going to happen in the information-technology industry and how India would be able to leverage its competitive advantage in the IT industry internationally. It was very clear that they had a bunch of overeducated, underemployed people who would work for very cheap and do a great job. If somebody could figure out how to harness that set of assets, they'd make a ton of money. That's exactly what happened. I'm happy to tell you I rode it along and got out before the bubble burst.
Watching that unfold was a valuable experience as a higher-education administrator, because I learned a lot about what industry doesn't know and can't cope with and what higher education has to offer that we're not very good at articulating to anyone outside of our own group. I'm sure most of you have heard the terrifying numbers, the scary, frightening numbers that are being bandied about--about how America is falling behind in competitiveness in education, that we are losing the battle for the preparation of young minds. There are some pretty scary numbers out there. One of the things I want to do today is to talk about the real numbers and put them into a context that I think is illustrative. I'm going to focus largely on India, not only because I know something about India, but also because the data from China are just unreliable. There are lots of crazy numbers bandied about in China, some of which--if you believed--within 50 years, every man, woman, and child under the age of 60 would be a qualified engineer in China at the rates that one hears. I don't believe those numbers, but the data from India is quite reliable.
Last year there were 10.5 million students in higher education in India in 18,000 institutions for higher education. Last year in the US there was something on the order of 10 million students in around 7,000 institutions. If we compare like to like in these data, we're not being overwhelmed by the numbers. If we look carefully at what the institutions are like that we're talking about in India versus the United States, it becomes really revealing and nothing short of astonishing. In 1950 there were 27 universities in India. This was right at the time of independence. That's roughly one university for every 13 million people. India has made a significant investment in higher education and has an elaborate funding mechanism, the University Grants Commission, which targets money to higher education. If you look at the speeches of virtually every prime minister since independence, they understand the value of higher education. Since 1950, as a result of this massive investment, there are now 272 universities in India. That's one for every four million people. That's roughly the equivalent of one university for the cities of Chicago and San Francisco.
If we look at those ten million students and their 18,000 institutions, and we look at the alignment of what it is that they're being taught with what it is that they're eventually being asked to do, we find that India's education system—if you listen to Tom Friedman's characterization, "It is going to eat our lunch in short order" --is narrow, sterile, and incredibly slow to change. Only sixteen percent of the students in India's higher education system were engaged in study that the Indian business roundtable says could result in employment. Only sixteen percent. Eighty-four percent of them are enrolled in what is broadly characterized as arts and sciences. Now lest you think that what I'm doing is making a case for vocational or technical education in higher education, I want to read to you the characterization of liberal arts education that was recently published this month by an organization called IMA. They do strategic analysis for some of the top CEOs in India and do white papers on various topics. This is what they have to say about liberal arts:
For those of us who have spent our lives in the liberal arts, that characterization may seem something of a shock, but it's true. Our students are remarkably well prepared to live productive lives in the market place. It is, as I will argue further, precisely because of that liberal arts education. Liberal arts, nontechnical employment--that's not really the issue for Tom Friedman and for other alarmists. It's really the engineering arena. This is where we are going to fall behind. This is where we are going to be beaten up. This is where we have to simply surrender apparently. The numbers that are most frequently cited in the media, at least the ones that I have most frequently seen; tell us that the United States produces roughly 70,000 engineers every year, India produces 350,000 engineers every year, and China produces 600,000 engineers every year. You will see these cited in a range of reliable media. These are the numbers that have become part of the urban myth.
In December of last year, there was a study done by some scholars at Duke to see if these numbers are really true. They gave up on China, because the ability to find real numbers in China is so difficult. What they discovered was that India only produced 112,000 engineers and the US produced 137,000 engineers. The definition of engineer is very carefully drawn here. It means someone who holds a minimum four-year degree and is engaged in what in the professional categorization is problem-solving kinds of work, rather than screwing bolts onto items that other people have designed. Of these 112,000 engineers, eighty-four percent of them were in the information-technology arena. They only produced 17,000 engineers outside computer science and electrical engineering in a country of one billion people. This is 104 degrees in engineering for every million people versus 468 degrees in engineering for every million people in the United States. I would argue that is exploiting your greatest natural resource, looking after it, stewarding it, husbanding it in a manner to get this optimum return.
If we look further at the Indian higher education system-remember there are 18,000 institutions compared to roughly 7,000 in the United States, and that includes two-year degree-granting institutions and the private sector, as well as the public sector--eighty¬five percent of all government monies invested in higher education go to simply 130 institutions out of 18,000. All ofthe rest of them are basically on their own, supported in wholly inadequate manner by individual states or private institutions of one sort or another. The average size of a higher education institution in India is between 500-600 students. For those of you who have had any experience with budgets or with planning, you know that 500 students aren't enough to generate enough money to have any kind of serious technical education. In the United States the average size of these institutions is somewhere between 3,000-4,000. The private sector in India is completely unregulated. Aside from those 280 institutions that have been created by the Indian government and are officially deemed universities by an accrediting agency, there are the rest of the 18,000 that have no regulation whatsoever. As a parent, as a student, the option of going to one of these institutions is a real crapshoot. You have no idea whether the "engineering" degree that's being offered by the local institution of higher education has any grounding in what one might seriously call engineering.
In order to correct this and address this problem, the University Grants Commission, the oversight body for higher education in India, created an accrediting body in 1986. It was their intent to rectify this grotesque lack of regulation in higher education. Since 1986 this accrediting body has accredited a grand total of 128 institutions or roughly seven per year. That puts us up to almost 250-270 institutions that have anything like a claim on credibility.
So what does this mean? If we look at the distribution of students, among those 10.5 million who are in higher education in India at the moment, eighty percent of them are in these unregulated, unaccredited institutions. This includes engineering, in which eighty¬eight percent are in unregulated, unaccredited institutions, pharmacy is ninety-four percent, architecture is sixty-seven percent. Teacher education has seventy percent in the private sector and in medicine, forty-five percent. Almost half of the practicing doctors in India have degrees from institutions that are unaccredited and the quality of this education is virtually unmonitored.
So what does this mean for us? We can sit back and give a sigh of relief and wipe our brows that our lunch probably won't be eaten tomorrow, but it doesn't mean that we can walk away and rest on our laurels. These data are important particularly for those of us in this room, because I don't know of another profession that is more self critical and occasionally despairing of its own effectiveness than ours. That is both a source of some annoyance for me and a source of celebration. What it means is, as the IMA (International Market Assesment) folks said, that we are "continuously innovating, updating, and strengthening our programs." That's the real genius of institutions like this one.
We have a gigantic lead over the rest of the world in higher education. It is the most distinctive lead that we have in any sector, including capital markets, in the world. It's focused on our greatest natural resource. I'd love to say that this is by constant design of the legislative visionaries of the country, but I probably won't say that. I will say that this is a time-honored tradition in this country. We need to recognize that--as beneficiaries and participants--and celebrate it, ensure it, and preserve it. Some of you have heard me talk about the incredible turn of events in the darkest moment in US history that gave rise to institutions like this. In 1862 during the Civil War, the North was losing. They hadn't won a single battle. It looked like the Union would fail. Lincoln was arresting editors for publishing things that he didn't like, suspending the rule of habeas corpus. It was probably the darkest moment in US history. Then they passed the Morrill Act. In 1944 World War II wasn't even over when they passed the GI Bill, which transformed this country. We are the heirs to that. I know of nothing, no history, no civilization that has ever done anything like this.
Every state has a network of public higher education institutions that are of incredible value to the people in the state. They don't want to pay for it. I grant you that. They're perfectly comfortable with watching the edges of buildings fall off. You are overpaid and underworked. All of that is true in legislative circles, but they care about these institutions. We have to cultivate that. We have to get the story out about our ability to continuously innovate, update, and strengthen. That is America's greatest differentiator.
Who has responsibility for this? Legislators for sure, but they are bound by lots of demands and bizarre election systems. Industry has a huge responsibility, much greater than they have been asked to bear in the past. We have to figure out ways to get them to the table more aggressively and in a broader base than we have previously. Alumni have an enormous obligation. They have been the immediate beneficiaries of what we do here. They have an obligation to see to it that this place flourishes. We also have an obligation. Our obligation is to tell the story of what we do here on a daily basis in a manner that's succinct, comprehensible, and intelligible to those people out there who care about what happens on this campus. If we do that well, and place it in the context of these kinds of data, I'm convinced that we're going to see a boom in investment in higher education. It's not going to happen quickly. It may require some externality like a political or economic crisis, but we've got a set of instruments, tools, and institutions like KU that are ready, that are delivering, that are transforming lives on a scale that would have been unimaginable at any other time in human history. We have the responsibility to nurture those institutions.
Luckily, I have enormous confidence that that's why you're here. Everybody in this room who got into higher education for the money please raise your hand. We all got into this because of a passion that we feel for the area of study that we engage in. That passion is what I want you to help me articulate. I'm going to be asking you this over and over again. The thing that excites students in the classroom, the thing that animates parents, the thing that is attractive to industry is not the abstract statement of values, principles, and curricular matters. It's when they see how excited you get about what it is that you do. That's the magic juice here. There's no one who can articulate that better than you. I can't do it. I can do it for myself, but there's not a lot of interest in the world in Sanskrit, at least in this part of the world. I can captivate people when I talk about Sanskrit, because I care deeply about it, and so can you about every topic, every subject, every area of inquiry that you engage in. I'm going to be asking repeatedly and in as many different ways as I possibly can for you to help me get the rest of the world to have access to your passion.
Thank you very much.
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