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Rosowsky examines the potential consequences of proposed federal funding cuts to research and student aid, warning that they could drastically alter the operational reality of many universities. While some institutions have learned to thrive with reduced state support by diversifying revenue streams and aligning with national priorities, others remain unprepared. He explains that these shifts will close some long-standing pathways while opening new ones, and success will hinge on a university’s ability to adapt quickly and define its contribution to national and economic security.
The proposed cuts to research, the proposed cuts for student funding, of student aid, the discussions that are being had. If they come to pass, they will seriously change the positioning and the operational realities of U.S. higher education institutions. So there's absolutely no question of land grants and public research universities.
Well, they have historically enjoyed greater state support in particular that support has declined over the years. So instead of being 50% supported with public funds or 25% or 15%, now there may be 9% or 6% supported by state funds in that case. So they've learned to diversify their revenue streams, they've learned how to achieve their mission, which they believe in, whether somebody is paying them to do it or not.
Using precious resources that they generate through tuition, through research, through private philanthropy, through partnerships with industry, collaboration with foundations and mutual collaboration, with other institutions of higher education. So they figured out how to do this. I don't worry about most universities and figuring out how to navigate a new financial landscape. I worry about schools that have not prepared themselves for what's coming.
And I don't just mean financially, but I mean, prepared themselves for expectations that students want to feel comfortable about their job prospects when they graduate. Families want to feel that their investment that they're making in their students' education is a worthwhile investment. And as a strategic investment, we live according to many in the first generation that will not live as well as their parents.
If that's true, that's, that's reason for concern. So I worry about schools that are struggling now because the challenges ahead will, frankly, force mergers and closures. But universities that have been adapting, growing, evolving, learning how to self-organize and operate with fewer state funds, for example, I think they've learned some skills that will serve them in a new federal reality if it comes to pass.
There will be if some of these things come to pass and some of them already have, there will be doors closing. There will be pathways that have been historically, open, welcoming and even lucrative for universities that will no longer exist. That said, there will be new doors and there will be new paths that can be pursued.
The federal government will invest. We just have to pay attention to where they're investing. The universities still have a place. We just have to take stock of ourselves and say, this is how we will contribute. In the case of Arizona State, we think about how we will contribute to our nation's security and to our collective economic security.
And that's pretty powerful. And if we hold that line and we deliver the way we always have, we will be a valuable institution to this country.