PURDUE’S BOLD PLAN
Mitch Daniels wants to make college more a ordable and increase his university’s enrollment. Higher-ed purists are aghast.
WAITING FOR Mitch Daniels to pick up a call to his o ce in West Lafayette, Indiana, you hear a recording of Purdue’s marching band followed by a hard-to-believe statement: “Purdue has frozen tuition at 2012 levels through 2019 for all undergraduate students.”
Daniels, the president of Indiana’s agship public university, then gets on the phone and says something even more startling: In in ation-adjusted dollars, Purdue costs $4,000 less per year for outof-state students than it did when he took the job in 2013. In-staters pay nearly $3,000 less, at just under $23,000 this academic year for tuition, room, board and expenses.
Back in 2013, Daniels, now 69, dashed hopes that he would run for the Republican presidential nomination, signing on at Purdue instead a er two terms as Indiana’s popular moderate GOP governor—and setting out to x the broken business of higher ed. His rst priority: make good on Purdue’s mission as a land-grant university, a designation dating back to the Civil War, when the federal government allotted land and funds to universities that would teach agriculture and the mechanical arts to working-class Americans.
Daniels believed Purdue wasn’t ful lling that mission. “ e only costs that have outrun healthcare in the last three decades are college tuition, room and board,” he says. His solution: Freeze student costs at 2012 levels. Purdue’s admissions sta ers balked. “I said, ‘Look, I just landed here on Mars, and I can tell you that the people back on Earth think college costs too much.’ ”
Attacking a ordability from another angle, in 2016 he introduced income-share agreements. Students who exhaust federal loans can fund their education with an agreement to sign over a share of their future income, usually between 3% and 5% for up to ten years a er they graduate. (Repayments are capped at 2.5 times initial costs.) Critics hate ISAS because they’re unregulated and untested. Milton Friedman is said to have invented the idea but famously noted that they were “economically equivalent . . . to partial slavery.” Daniels says, “If you want indentured servitude, it’s the student-loan program. With ISAS, the risk shi s entirely to the lender,” since grads who don’t nd work pay nothing.
Daniels’ third bold move invited the most criticism from higher-ed purists. Last year he paid $1—yes, a dollar—to acquire the beleaguered for-pro t, largely online Kaplan University from former Washington Post owner Graham Holdings Co. Purdue instantly boosted its enrollment by 30,000 Kaplan students—most of whom are female, between the ages of 30 and 60, and the rst in their families to go to college. ey are now working toward degrees at the newly named Purdue Global University. A er Purdue covers operating costs and collects $50 million in tuition, Kaplan is entitled to 12.5% of Purdue Global’s revenue.
So far, so good. Applications are up 67% since Daniels became president. Enrollment is at an all-time high, as are alumni donations, graduation rates and the number of startups launched by Purdue researchers. Purdue also ranks No. 126 on Forbes’ list of America’s top colleges, up from No. 143 last year. While other institutions are cutting tenure-track jobs, Purdue has added 75 tenured engineering professorships and increased the number of students earning STEM degrees by 33% (minorities are up 50%).
en there’s Boiler Gold, a cra beer on which Purdue’s hops and brewing analysis lab is collaborating with a local brewer. “It started as a research project,” says Daniels, “and now we can’t make the stu fast enough.”