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<p>University of Michigan and two other pubic universities have the highest bond rating. That speaks for itself. </p>
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<p>[U-M</a> maintains top bond ratings](<a href=“U-M maintains top bond ratings | University of Michigan News”>U-M maintains top bond ratings | University of Michigan News)</p>
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<p>Great. I’m sure graduates will appreciate Michigan’s bond rating when they are out looking for non-existent jobs within the state itself.</p>
<p>Don’t be so proud Cuse0507. I seem to recall when the south was having their problems as well. This is a national recession that we’re in. In the meantime, Michigan’s grads work everywhere. They are not so provincial to think that they cannot find employment anywhere in this country, as well as internationally. I’m sure the graduates of the UNC might not have as much luck once they leave their area. A national and global reputation does have its rewards.</p>
<p>UM and UNC enjoy excellent reputations throughout this country and throughout most parts of the world. I wasn’t trying to be smug; I was just trying to demonstrate that there are bigger economic factors that affect a university’s graduates (and students) than its bond rating. Perhaps I could have worded it better.</p>
<p>It just seems to me that too many posters rag on the state of Michigan and forget that the economy is not good almost anywhere in this country. Frankly, it’s getting old. Furthermore, U-M has approximately 1/3 of it’s students from OOS. Do you honestly think most of them plan on living in Michigan after graduation? To me that is a testament of the greatness of the school. So many people attending a public institution from other parts of the country and world. Most paying top dollar for it as well.</p>
<p>Yes, rjkofnovi, 1/3 of the undergraduate student population and ~50% of the graduate student population are non-Michigan residents. That alone represents the power of the Michigan name locally, nationally and internationally. People come here for an education they can use anywhere on the globe.</p>
<p>Cmuse, the high bond rating demonstrates that the University of Michigan is not financially struggling. Investors have high confidence in the university.</p>
<p>Are these the same firms that gave AAA ratings to the mortgage debt that has now ruined the economy? ;-)</p>
<p>I was just at the school today tenisghs. So much building going on, as usual. I spent a couple of hours in the new art museum expansion and renovation and it’s truly beautiful. The new north quad complex and woman’s and children’s hospital are coming along nicely. Finally, I drove up to the Big House. It finally looks as impressive from the outside as it does on the inside. What an excting time to be in Ann Arbor!</p>
<p>Well barrons, that could very well be. So what’s Wisconsin’s rating? :-)</p>
<p>I think this whole thread is unbelievably silly. The fact is, there has never been a particularly strong correlation between the strength or growth rate of a state’s economy and the quality of its flagship public university. This is just wishful thinking on the part of that devout Michigan-hater, hawkette. </p>
<p>Tell me, when New York’s economy was riding on top of the world, did it have the strongest state universities? No. True, California had its economic moment in the sun and former governor Pat Brown decided to spend like a drunken sailor to build, as he put it, “the best university in the world,” and it worked for a while. Later governors have been more parsimonious and California’s economy has gone wobbly many times since the 1960s, but UC Berkeley remains the nation’s premier public university despite those economic and fiscal ups and down. In contrast, Michigan’s economy has been deeply troubled since at least the early 1970s and in some ways all the way back to the late 1950s, yet it has maintained in the University of Michigan one of the nation’s top public universities despite chronic state fiscal problems that have weaned the University off all but a tiny trickle of state aid—and in the process, made the state’s budget situation all but irrelevant to the University’s fiscal strength and condition, as the school now depends on a diverse and surprisingly durable independent revenue base. </p>
<p>In the 1980s and 90s we saw a tremendous shift of population and economic growth to the so-called “sunbelt.” Did that produce top-notch public universities in Arizona, Nevada, Texas, Tennessee, Alabama, Georgia, Florida, South Carolina? Well, the University of Texas arguably got a little better, though mostly off oil revenues, not state aid. The University of Florida got a little better, as did the University of Georgia, but neither was propelled into the very top ranks of public institutions; and public higher education continued to lag in most of the other Sunbelt states, with their skinflint anti-tax fiscal priorities never providing enough money to build truly great public universities in short order as Pat Brown did in California.</p>
<p>Well, ok, maybe it’s not about growth rates. Maybe it’s the size of the state’s economy that matters, on the theory that a bigger economy can siphon off more resources to support the flagship state U. Let’s see, the top states by GDP are, in order, California, New York, Texas, Florida, Illinois, Pennsylvania, Ohio, New Jersey, Georgia, and North Carolina. Of these, only California and North Carolina have top-ranked public universities. True, Michigan is #11 and Virginia #12, so there may be something here; but the fact that so many economic heavy-hitter states don’t have premier public universities ought to tell us that we shouldn’t rely on a crude economic determinism. clearly, Michigan, Virginia, and North Carolina all “punch above their weight”; either that, or the states with bigger economies are just laggards. Or both. either way, the strength of a public university can’t be completely explained by the size of the state’s economy. </p>
<p>Well then, what about a correlation with per capita income? Surely the richer states can afford better public universities, so that as North Carolina becomes richer, its public universities will soar? Sorry, the facts just don’t back that hypothesis. The states with the highest per capita income are, in order, Connecticut, New Jersey, Massachusetts, Maryland, New York, New Hampshire, Minnesota, Colorado, California, and Illinois. (Hmmm . . . no sunbelt states, except California; how odd that the high tax-and-spend states are also the richest). Of these, only California can boast a top-5 public university (arguably two), though UIUC is also excellent. True, Virginia’s 11th, but Michigan is all the way down there at 25th (about where it’s alwasy been) and North Carolina is even further down at 38th. So there just doesn’t seem to be much correlation, does there?</p>
<p>The truth is, a lot goes into building and maintaining a great university, public or private, and most of it has little or nothing to do with the size or growth rate of the state’s economy. For publics, state aid matters, especially when it’s just getting started. There’s no question the University of California’s rapid rise was propelled in no small measure by Pat Brown’s generous (some would say reckless) spending. Will that happen in North Carolina? Well, they seem to be fiscally much more conservative than that. But over time, state aid comes to represent a much smaller percentage of a great university’s budget. Endowment matters a lot more. Research capacity, and success in competition for both federal and private research grants is a huge element. Prudent management of and investment in the university’s resources— financial, physical, and human—is crucial. It becomes a self-sustaining enterprise that runs on its own momentum and greatness. A great university can flater—but it doesn’t happen nearly as often nor as easily as hawkette would have you believe (and if it did, the University of Michigan would have ceased to be a great university in the 1970s, when the state’s economy went into steep decline).</p>
<p>I wish the University of North Carolina well. It is already a great university—though with a smaller endowment, smaller research capacity, not quite as strong a faculty, and not quite as strong a reputation as those ahead of it in line, it’s got a lot to overcome to move ahead of its rivals. I wouldn’t bet the house on it, and I certainly wouldn’t expect it to happen in the next five years, nor probably the next ten. Beyond that, it’s anybody’s guess.</p>
<p>^^ Very well said, bclintonk!!!</p>
<p>I will highlight the most important part of his post below:</p>
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<p>Very good point, bclintonk. Very well said.</p>
<p>novi,
The new buildings and constructions you saw are the $2.5 billion Michigan spent to grow in the last 2-3 years (that’s more than UNC’s entire endowment):</p>
<p>"An army of ironworkers, masons, carpenters and laborers are swarming the campus of the University of Michigan these days, as the university undertakes a construction campaign budgeted at $2.5 billion, ranking it among the largest university building programs in the United States.</p>
<p>Nine major buildings for science, medicine, health, art, business, sports, food service and student housing are in various stages of construction here. They encompass nearly three million square feet, at a cost of about $1.66 billion. Five others are in the design stage. </p>
<p>This comes after the completion in the last two years of 10 other buildings — for biomedical research, cardiovascular treatment, science, technology, engineering, public health, public policy and drama — covering 1.7 million square feet at a cost of $836.4 million. The square footage in the new and renovated buildings comes to the equivalent of 105 acres.</p>
<p>“Having the right facilities is crucial to a thriving public research university,” said Philip J. Hanlon, vice provost for academic and budgetary affairs at the University of Michigan…"
<a href=“http://www.nytimes.com/2008/12/31/realestate/commercial/31michigan.html?_r=2&n=Top/Reference/Times%20Topics/Organizations/U/University%20of%20Michigan[/url]”>http://www.nytimes.com/2008/12/31/realestate/commercial/31michigan.html?_r=2&n=Top/Reference/Times%20Topics/Organizations/U/University%20of%20Michigan</a></p>
<p>Is this the picture of a university in financial distress? It would take UNC a long time to catch up with that, wouldn’t it?</p>
<p>Agreed. I hope this is the end of this thread.</p>
<p>Bc,
I think your analysis above is incorrect. Most of all, I think that you are greatly mistaken about the relationship between economic conditions, money and great universities. I think that there is frequently a HUGE connection between these and, in the case of many public universities, the wealth that was created in their states or by their alumni often have had a very large role in building up and sustaining a school. </p>
<p>Historically, when America was a less dynamic and fluid society than it is today, the universities of the Northeast were the only game in town for nearly all of elite academia. Yes, there were outposts in a few places here and there, but by and large this was the story. But that all changed with the creation of huge amounts of wealth in places like Texas (oil) and California (technology, aerospace, other), Pennsylvania (oil, steel) and even Michigan (automobile). After the initial hyper-growth phase, these industries became major sources of contribution to higher education and that giving continues in succeeding generations. That wealth also brought with it lots of political power which often translated into further governmental grants to aid university research centers and local industry. </p>
<p>As for the Northeast, the money and wealth center has always been New York City with its high concentration of NE elite college grads. They had little interest in building a system of top publics as the privates there were so highly regarded and nearly all of the money went to them. That was the pattern historically and that mostly continues today. </p>
<p>Looking forward, you know what has been written by many about the economic outlook for the Midwest. Attack me for that if you like, but the outlook is not good and my belief is that, at the margin, this cannot be a good thing for higher education in these states. I think the same could said about California, but that is more due to budget reconciliation issues and high current and future tax rates. California should watch out or it will kill the golden business goose and folks will leave the state. But they can still change course and grow because the businesses and the brainpower in the state are (IMO) unmatched anywhere in the USA. Furthermore, trends with the rise of China and the Asian Tigers certainly can benefit California and create a lot of revenue to assist that state (and indirectly its colleges)</p>
<p>I think that Virginia’s economy has an opportunity to continue its growth as their Northern Virginia tech centers happen to have the greatest customer in the world (the US government, esp the DoD) to fuel their businesses. Whether U Virginia will benefit from NoVa’s growth is still an open question as a lot of the money there is being made by folks without a close tie to the school…or for that matter, even the state. Lots of folks there who probably don’t know the difference between Charlottesville and Charlotte. As this thread relates to U Virginia, my opening comments were meant as a response to news that we have read about their endowment troubles and large losses. One would expect that to be temporary, but only time will tell. </p>
<p>U North Carolina benefits from its location in a diversified economy that is adding population and jobs. The state has a history of good management and their business community is full of shrewd folks who run circles around many of their competitors without them even realizing it (if you want confirmation, ask the folks from the now non-existent Virginia banking market). One difference between North Carolina and states like Texas and California is that, now that the banking industry is under such a cloud, there is no great creator of wealth in the state. So, while they have a growing economy, it will be interesting to see where the wealth gets created and by whom and how this ends up benefiting the state and the local universities. </p>
<p>Other Sunbelt states like Florida were poised a few years ago to make a major move in terms of dollars going toward higher education. But the major setbacks in Florida real estate and the currently crippled economy have left the state’s budget in a really bad way. They’re just lucky that California is such a mess because otherwise, they’d be the poster child of US states with major budget problems. By contrast, Georgia had much less of the craziness that went on in Florida and their economy, while not as diversified or as well managed as in North Carolina, is still benefiting from the long-term trends that continue to benefit the Sunbelt. Not sure how this all plays out in local wealth, but I would not be surprised if U Georgia becomes a much better place than U Florida over the next decade. </p>
<p>Anyway, I could go on, but I’ve rambled more than I intended. I think you’re off the mark above, both in your analysis and in your characterization of my feelings toward your school. I don’t hold it in nearly the same regard as you, but I certainly respect it as a fine school and certainly among the nation’s top five publics. If you must interpret such words as an insult, then so be it, but they are not meant in that way.</p>
<p>hawkette, you still fail to see bclintonk’s point. No matter how much the state of Michigan struggles economically, University of Michigan has continued to defy all odds with its $7 billion endowment, ongoing construction projects, highest-ranked bond ratings, current proposals to hire 100+ faculty, and much more. The university saw its future decades ago, and planned accordingly to withstand economic turmoil and instability.</p>
<p>The state of Michigan has the highest (or second highest) unemployment rate in America. Michigan has been in a recession for over eight years. The main industry, automobile, is struggling as lots of employees are losing their jobs. According to your logic, University of Michigan should be falling apart. That’s not the case here. </p>
<p>We all know you’re anti-Michigan. Give it a rest, and say Michigan is performing well financially.</p>
<p>tenisghs,
I continue to be amazed at the head-in-the-sand thinking that I am reading here. U Michigan is not an island. The environment has had an impact and there is data to support that. U Michigan’s bond rating may be strong, but the financial environment in the state for the last decade cannot have helped the school. Heck, imagine it from the other side. What if U Michigan were located in an economy that was thriving. Do you really think that that would not benefit the school? </p>
<p>Or forget U Michigan for a second and try to think about this for an institution in which your heart is not as connected. Think about what’s going on in California. Do you really think that that situation does not affect the financial outlook for UC Berkeley and UCLA? And if California does not get its house in order and work to retain businesses and attract new businesses and a brain drain takes place, do you really think that UC Berkeley and UCLA will not be affected?</p>
<p>ha ha ha ha…</p>
<p>UW itself only does revenue bonds. AAA. All other bonds go through the state bond system. That way the state pays it back too and the UW does not have to use its money to pay off the bonds. </p>
<p>[MOODY’S</a> ASSIGNS Aaa/VMIG 1 RATING TO THE UNIVERSITY OF WISCONSIN HOSPITALS AND CLINICS AUTHORITY VARIABLE RATE DEMAND REVENUE REFUNDING BONDS, SERIES 2009 B - New Issue - 2009/03/04 - Moody’s Global Credit Research - AlacraStore.com](<a href=“http://www.alacrastore.com/storecontent/moodys/NIR_800040170_1035244]MOODY’S”>MOODY'S ASSIGNS Aaa/VMIG 1 RATING TO THE UNIVERSITY OF WISCONSIN HOSPITALS AND CLINICS AUTHORITY VARIABLE RATE DEMAND REVENUE REFUNDING BONDS, SERIES 2009 B - New Issue - 2009/03/04 - Moody's Global Credit Research)</p>
<p>Hawkette, Michigan is not a regional university. In recent decades, the majority (over 90%) of recruitment activity and hiring activity on the Michigan campus has come from companies headquartered in other states such as California, Illinois, New York, Oregon, Texas and Washington (state, not DC).</p>
<p>Furthermore, although the state Economy is not doing well, there are pockets within the state that are doing fine. Ann Arbor and its neighboring towns are actually quite well off. Southwestern Michigan is also doing relatively well. And there are several major companies in the state located in other regions that have a bright future, such as Kellogg and Dow Chemical. </p>
<p>Would the University of Michigan benefit from a healthy state economy? Obviously. But is the University of Michigan negatively impacted by the economic downturn? Not really.</p>