By Jared Chausow
By Katie Toth
By Elizabeth Flock
By Albert Samaha
By Anna Merlan
By Jon Campbell
By Jon Campbell
By Albert Samaha
The idea that the expansion was for the sake of the children was met with similar skepticism by Manhattan's Community Board 2, which savaged the plan after reviewing it. "In the first ten years of NYU's plan, only 18 percent is devoted to academic uses, and 82 percent is not looked at for ten years," David Gruber, the board chairman, testified to the City Council. "If the plan and this whole development that NYU wants was so important to get that academic balance that they've lost, why are they waiting for ten years?"
There's an even more fundamental critique of the expansion plan, leveled by the faculty of NYU's Stern Business School—not exactly known as wild-eyed radicals—when they voted to oppose the plan last year by a margin of 52 to 3: How on earth is NYU going to pay for this? Referring to the several billion dollars of debt that will presumably be needed to bankroll the project, the Stern faculty pointed out that "up-front financing costs imply that interest payments alone could be hundreds of millions of dollars a year. We are concerned about financial risks and the possibility of default. We are concerned that these large costs will be paid for by some combination of higher tuition rates, a larger student body, lower teacher-student ratios, fewer tenure-eligible faculty members, reductions in real faculty salaries over time, and smaller benefits."
Financial worries aren't just theoretical in the case of NYU. Compared to the older Ivies with which it now competes, the school has never had much of an endowment. Its $2.5 billion is about a third of Columbia's endowment, and roughly a twelfth of Harvard's. With only 4 percent of its revenue coming from the endowment, NYU must rely far more than many schools on the tuition and room-and-board fees paid by its students. In this year's budget, some 64 percent of NYU's revenues come from those two sources.
As a result, NYU has startlingly high tuition and extremely scarce financial aid. The Princeton Review recently ranked NYU's financial aid and administration as the worst in its survey. Newsweek called NYU the fourth least-affordable school in the country. The result, as the Voice noted in a cover story last year, is that NYU generates a staggering amount of student debt, some $659 million in 2010. The school's graduates owe 40 percent more than the national average.
Snowballing student debt nationwide surpassed $1 trillion last year, leading Moody's to downgrade its outlook for American higher education to "negative." And the widely expected bursting of this debt bubble is one of the main reasons that the "eds and meds" theory so beloved by Sexton and NYU is now falling out of favor. Richard Florida, the very theorist whose quotation is emblazoned on NYU's 2031 website, wrote in his 2012 revision of The Rise of the Creative Class that "Meds and eds jobs add little to regional income. In fact, we found that regional earnings and incomes fall as a region's share of meds and eds jobs rises." The whole premise of the 2031 plan is, in other words, wrong.
"It's important to understand that when you're talking about the growth of NYU, the New York piece of it is only half the picture," Miller says, over a bowl of chili in a café near Washington Square. In the last decade, NYU has also been expanding and franchising worldwide at an astonishing rate, under an initiative called the Global Network University.
Many schools make a gesture toward international education, but those efforts are usually limited to a handful of study-abroad programs. With the GNU, as it's called, Sexton has created something entirely new: a university with multiple nodes and campuses spread across the planet, a network through which students, educators, and administrators flow freely. "I've heard people refer to the GNU and 2031 as Sexton's international policy and domestic policy," says ChristineHarrington, a professor of politics.
The flagship of the GNU is NYU's partnership with the hereditary rulers of Abu Dhabi, which was announced in 2007 and soon followed by the unveiling of NYU Shanghai. Together with New York, these represent the three primary degree-granting "portal campuses" of the university. They are supplemented by smaller "node" programs in Accra, Berlin, Buenos Aires, Florence, London, Madrid, Paris, Prague, Sydney, Tel Aviv, and Washington, D.C.
As a result of this mission creep, the number of NYU students studying abroad has nearly tripled in the last decade. NYU sends more students abroad than any other American university. In 2011, 43 percent of the graduating class had studied at one of the "global sites." NYU's administration touts the GNU as a visionary 21st-century reimagining of the university itself, an evolution of higher education that's driven by the latest technology and geared to the new globalized reality.
That's just rhetoric, says Miller: "The GNU is a cash cow. That's all it is."
Cycling students through the global sites allows NYU to increase its enrollment without having to keep up the expensive New York infrastructure needed to house and support all those extra students. In Abu Dhabi, the entire project has been bankrolled by the emirate, while most of the other nodes are outposts run on the cheap, with faculties made up of relatively low-paid contract workers, not expensive and sometimes obstreperous tenured professors. The students, however, are still paying full freight. You pay NYU about the same for tuition, room, and board in Ghana as you would in Greenwich Village.