Mario Waissbluth and Patricio Basso question the educational reform legislation presented by the Government

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The current board member of the Fundación Educación 2020 and the former executive secretary of the National Commission of Accreditation (CNA) shared their views regarding the government’s higher education reform legislation at a conference organized by the Faculty of Physical Sciences and Mathematics at the Universidad de Chile, moderated by the dean, Patricio Aceituno.  In this edited version of their remarks, the experts address issues that are being analyzed, like the initiative’s proposal to guarantee an end to profit seeking and whether the initiative can improve the quality of the various faculties.

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Patricio Basso, Mathematical Engineer and PH.D. in Engineering. Former Secretary of the National Commission of Accreditation. Former Vice Chancellor of Finance and Administration of the Universidad de Chile

Throughout my presentation, which will focus on undergraduate education, I would like to mention several points.  Firstly, I would like to say that the free market was not able to regulate the access to education.  In the year 1989, there were 115,158 students and in 2014, there were 645,489; in other words, it increased 5.6 times in only 15 years.  In a company, 5.6 times is not an exaggerated growth rate, but we know that in a university, it is impossible to have that kind of growth and at the same time maintain a level of quality.  Where did these students, who had the chance to enter the system and be successful, come from?  This increase occurred in a context where primary and secondary education was not modified, which meant that this upsurge occurred with students who were not at all prepared; and what may be even worse, with a shortage of academic staff—who cannot be invented out of thin air from one day to the next.

Additionally, this growth in students was characterized by absolute chaos with respect to the university degree programs.  Today there are 1,119 different degree majors, and when you take into account the different universities, the different campuses, and the different modalities, what you finally get are 4,598 different degree programs being offered throughout Chile, 21.6% of which have “engineering” in the title.  This abuse of the prestige of the field of engineering, which reflects marketing concerns, must be brought to an end.

How did enrollment figures change?  Between 2015 and 2016, the public state-owned universities grew a measly 4.7%; the private universities belonging to the Council of Chancellors of the Universities of Chile (CRUCH) grew 38.9%, the nine private universities of the Uniform Admissions System, like the Universidad Adolfo Ibañez and Universidad Alberto Hurtado, grew by 96.1%, while the rest of the private universities grew by 78.2%.

Secondly, I claim that the free market was not able to regulate the number of graduates either.  Indeed, facing such an enormous growth in enrollment, we should wonder about the results.  What is the graduation rate of the university system in Chile?  The answer is that we don’t know.  We talk about such a successful system that has made higher education accessible to so many, but we don’t know what the graduation rates are.

There is partial research on this done by the National Council of Education (CNED), with 21 to 27 universities and an average of 44,542 students taking part during the 2004-2009 period, and it concludes that the graduation rate was not higher than 51%.  To come up with an estimate for the whole system, I invented a different method, the results of which I will publish soon.  In any given year, a continuing student has three alternatives: graduate, register again for the following year, or drop out.  With this data I can estimate the drop out rates, as well as the graduation rates.  Using official figures from 2005 to 2015, I obtained a graduation rate of 45% for the undergraduate university system.  This figure was not known, which might help to explain the grave error in diagnosis made by the President of the Republic in her speech introducing the legislation pertaining to higher education.

Meanwhile, the INE (National Institute of Statistics) figures for the March-April period reveal that 39.72% of the unemployed are graduates of higher education, of which 21.26% are graduates from universities.  In other words, apart from having a low graduation rate, those who do graduate are in fact unemployed.  Is this a system that deserves praise?  No.  We’re talking about a system that claimed it would give universal access to education, but in reality, it has only lie to our youth, convincing them that they would be able to graduate.

Thirdly, I would like to say that the free market was not able to regulate the cost of tuition.  If we consider the tuition rates of the state-owned universities, in 2005 the private universities of the CRUCH had a tuition rate that was 33% higher, while the private universities of the Uniform Admissions System were 74% higher.  The chancellors of the Universidad Católica, the Universidad Alberto Hurtado, and others, say that if they are forced to lower their tuition price, they will not have enough money. They are scoundrels.

Chile is the OECD country that has the most expensive tuition rates, in proportion to purchasing power.  Chilean universities have higher tuition rates than the United States.  Someone might point out that since the state takes care of part of that tuition cost, the burden on individual families shouldn’t be that high.  That’s a lie.  According to an OECD study from 2015, Chile is ranked second with respect to family spending on tuition.  In the United States, which is the country we love to compare ourselves to, family spending on higher education was only 45.6% compared to Chile’s 54.8%, and its government spending on education is higher than ours.  It’s clear: the market was not able to regulate tuition rates.

Fourthly, the free market was also not able to regulate quality.  In 2003, Parliament was discussing quality assurance legislation.  On November 4th, the El Mercurio newspaper was saying, in the words of the Instituto Libertad y Desarrollo, that “accreditation constitutes a risk to the university market.”  The law was a disaster because they had control of the parliament thanks to the binomial system and thanks to the designated senators.  I can’t recall whether the government at that time proposed the idea of mandatory accreditation, but I suspect that it didn’t, and so instead of that, what came out was a useless heap that didn’t include mandatory accreditation, where you can’t use indicators, and what gets measured is only the improvement of the quality, not the quality in itself; in other words, if there is a terrible university that applies for accreditation and doesn’t get it, when it applies two years later as a bad university, it can then get accredited because it showed improvement.  That’s how the current accreditation system works.

Fifthly, the free market was not able to control profit making, and there hasn’t been any interest on the part of successive governments to control it.  In this regard, I’d like to clarify some of the concepts involved, because some people think we are against profits per se, and I, for one, am against profit making in the education sector, but have no misgivings about paying for the costs associated with sales and manufacturing when the time comes to buy a pair of shoes.  When there is some kind of buying and selling of goods or services, profit is the sales price minus the costs involved, and it is perfectly legitimate in any commercial transaction—except when it is prohibited.  And it turns out that in Pinochet’s own law, which created private universities, profit was prohibited.

A common error is to say that universities profit.  Bricks do not profit, the owners are the ones who profit.  This is not a subtle difference since it determines whom we go after for violating the law.

In light of the information presented, in my opinion, the government’s legislation regarding higher education has two very serious errors.  The first is that the presidential address alludes to universal access, it accepted the neoliberal discourse that highlights this as the grand achievement, but what’s truly important, and this is understood by anyone, is not how many are enrolled, but how many come out, and we have shown that only 45% of those who enroll actually graduate.  The rest will never graduate.  There is nothing to praise about the model, not even universal access, which is nothing less than state-sanctioned theft.

The second error with the proposed legislation, one that is more complicated, since many possibly don’t agree with me, is that it is often argued that it is the selection process that is behind the injustice towards low-income students, since it is said that this is what is preventing them from getting into universities.  This is a huge misconception, since it is not the admissions system that impedes students from gaining true access, but rather it is their inadequate prior schooling.  It is absolutely indispensable to have a unified system of admission, applied to the entire system, and differentiated to account for technical institutes, professional institutes, and universities.  If we do not apply strict requirements for admission, what we are doing is cheating our youth, and a country that cheats its youth cannot have a future.

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Mario Waissbluth, Civil Chemical Engineer and PH.D. in Engineering. Former Academic Director and current professor at the Center for Public Systems of the Universidad de Chile. Board Member of the Fundación Educación 2020

I would like to refer to three points.  The first has to do with, like the biblical phrase points out, “in the beginning, there was chaos.”  That is how my friend Patricio has portrayed it, that it has been debauchery, and not the free market, that is behind all of these defects, which I’m not going to repeat; although I will critique slightly his presentation, which, like with many things in Chile, suffers from a kind of universititis; as if the technical institutes, which today are the model target for the higher education system in Chile, even in terms of equality, belonged to an inferior class.  They have been treated this way in terms of scholarships, and even with respect to the existing systems of quality assurance.

You, Patricio, mentioned that there were four thousand or so university degree programs.  If we include in that figure the technical/professional system, it would be 12 thousand.  12 thousand programs, of which 75% have never been visited by a peer evaluator.  We’re talking about one million, three hundred thousand students of higher education in these programs; the evaluators couldn’t even locate them, and they have grown like mushrooms.  To fix this mess by installing an adequate accreditation process would mean, to give you an idea, closing approximately half the institutions and programs in Chile.  How long would that take in a country?  This could take us a decade, because we cannot send thousands and thousands of students who are studying in fake institutions and fake programs back out onto the street.

My next point originates in a personal story.  Educación 2020 proposed an ideal program of educational reform that meant free tuition for 60% of the most vulnerable students in the next presidential term.  We handed it to Michelle Bachelet in April 2013, and she thanked us effusively for the document; in fact, many of the points there were used in the government’s platform.  We helde a press conference, and she thanked us for the proposal and gave her famous phrase: “I can pay for the education for my daughter and it would not be fair for the state to have to pay for it.”  And I echoed our proposal, by saying, “I think Michelle Bachelet is absolutely right.  This is not the time for Chile to finance 100% of education.”  Thanks to that, the student activist leaders massacred me on social media.

Weeks later I was stuck in traffic and suddenly I saw a huge campaign poster that read: “A Public, Tuition Free, and Quality Education for All.”  What was the meaning of this?  I mean, to proclaim a quality and tuition-free university education for all, given the numbers and the data…I don’t deny that it could be a fantastic goal for a country like Germany, but here that promise was foolishly deranged, and created the kinds of expectations that have led to our current political tensions.  Why and how did the president change her mind?  We will never know.

The myth of tuition free education in the legislation proposed is consecrated by saying that in 2017 and 2018 we are going to reach 50% and then 60% coverage of the most vulnerable students, and that universal coverage will be achieved without knowing exactly when or with what money.   And that is stipulated in the legislation.  It’s like establishing by law that all minimum pensions will triplicate, without specifying when; or that we will triplicate spending in primary clinics, but not knowing with what resources.  I believe in free higher education as a right, but in an advanced country like Sweden or Germany.  But before getting there, we would probably do well to inject up to 200 million dollars into the National Minors Service (SENAME) to prevent the torture and abuse of our children, for example.

I think, also, that a political mistake was made by sending to Congress the macro, mega, hyper higher education reform legislation and throwing everything on top of the grill at the same time, because on that grill there are many good things, but there are also other things that are very controversial, and the good things will certainly die along with the bad.  What do I mean with this?  Chapters 2, 3, and 4, which correspond to the superintendency and to the accreditation system, in other words, the regulative function, were chapters relatively easy to dispatch, because today the right wouldn’t dare publish a critique of these in the press since they are demonstratively necessary.  Therefore, I think that those chapters should have been sent during the first year of the government.  To establish the bases for the system’s regulation wasn’t that difficult, but for some reason, we had to wait until now to throw everything together along with the other cluster bombs.

With respect to profit making, there has been a lot of abuse, the money has found its way back to the owners, and this has been uncovered by different investigations.  Now the legislative project pretends to control this illicit enrichment.  I think that part of the legislation is reasonable.  The problem is that it will not control what has already taken place, what has already been pocketed.  This took place for the simple reason that in Pinochet’s law, the universities couldn’t make a profit, but a criminal category was never clearly defined in order to sanction those who violated the law.  But now it is defined.   I think that in Chile, happily, this profit motive will be eradicated, and that is an achievement credited to the student movement, which I have congratulated.  The international experience teaches us that profit in the education sector implies a system of perverse incentives that is impossible to regulate adequately.

I think that in dealing with these issues there are many sacrifices that are being made on the altar of tuition free education.  In chapters 1 and 2, the project sets up an accreditation council; in other words, it makes some significant progress in highlighting what is essential, which is accreditation.  Where is the mistake?  In the fact that we have to sacrifice everything on the altar of tuition free education so that the social movements on the street are happy.

Think about the fact that a council of six will have the mission of going through the accreditations of close to six thousand degree programs.  How many peer evaluators do we need?  What army of peer evaluators?  With what resources?  With how many full time counselors can we truly fix this chaos?  This has not been considered, and why not?  Because someone must have said that all of this costs money, which had to go towards tuition coverage.  The real struggle is to ensure that when this accreditation is passed, not only must it be legally valid, but also it must count with all the human and financial resources necessary to function adequately.

Finally, I would like to refer to the likelihood of whether these higher learning institutions of the state, these public institutions, if that’s what you want to call them, will grow in terms of enrollment.  I want there to be higher enrollment in these departments for diverse, and obvious reasons: pluralism, secularism, and all of that which we know, but we don’t know whether this legislation truly contemplates this increase.  None of the necessary elements for this to happen are currently found in the project.  Some say that maybe they will appear in the future, but it seems, quite frankly, doubtful.

I would like to finish with two reflections.  First, I want to make an inevitable and obnoxious reference to Transantiago.  What was Transantiago?  In the beginning, it was chaos, the chaos of the yellow buses.  So the planners arrived, and they said that they were going to fix it by designing a model that would define the flow of passengers down each metro line, through each central bus line, through each feeder bus line.  They were also going to set the price, and this would put everything in order.  None of this happened.

Well, now we’re doing the same thing, because the proposed legislation contemplates a central planner that will be in charge of defining, initially, the tuition rate of reference, and the number of quotas for 12 thousand degree programs.  My legs shake just thinking about it.  On top of that, because everything must be sacrificed in the name of tuition-free education, there’s money for enrollment but not for anything else, like research, for example.  So, where are the implementation costs that serious universities have to assume, and which allow them to do what they do? Where is that?  I haven’t identified anything like that on the financial report of the legislation.

Finally, I object wholeheartedly to the concept that this legislation puts forward, which is typical of central planning, where there will be universities of type A, type B, type C, CFT; in other words, we’re going to cut the cake of the institution of higher education.  In the beginning it was chaos and I think that this law, through different mechanisms, it will continue.  I apologize for the harshness of these words.  I apologize, Madam President.

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