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W. Lee Hansen: In search of the real cost for UW diversity programs

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W. Lee Hansen

W. Lee Hansen is a professor emeritus of economics at UW-Madison.

What is the dollar value of the resources devoted to promoting racial and ethnic diversity at UW-Madison?

Though campus administrators regularly extol the educational benefits of diversity, they say little about the costs of achieving those benefits.

How substantial are these costs? The quick answer is they are large and exceed the official published figures.

What little information has been released on these costs is quite incomplete. The annual UW System Minority and Disadvantaged Student Report admits it "reflects only a portion of the expenditures for programs and activities designed to support academic success for historically under-served students."

The challenge here is to produce a full account of the resources costs devoted to Minority and Disadvantaged programs at UW-Madison. These 60 programs provide direct services and financial aid to help recruit, retain, and graduate targeted minority students. They do not include academic diversity programs such as the ethnic studies requirement, ethnic studies programs, or affirmative action in admissions and employment.

My analysis of the costs for resources of the UW-Madison Minority and Disadvantaged programs reveals how much they are underestimated. It is based on public documents as well as data obtained, often through open records requests, from UW-Madison and UW System.

The "officially reported" Minority and Disadvantaged expenditure in 2008-09 totaled $25 million. By contrast, my estimate of the resource costs of these programs is $40 million. One perspective on the $40 million figure comes from expressing it on a per-student basis.

If all 42,000 UW-Madison students are assumed to share equally in the benefits of these programs, the annual resource cost of producing these benefits is almost $1,000 per student.

If by contrast all benefits from these programs accrue to the 2,100 undergraduate targeted minority students (African-Americans, American Indians and Hispanics), the annual resource cost is roughly $20,000 per targeted minority student. Even if these benefits go to all 5,100 targeted minority students (including graduate and professional students) the resource cost approximates $8,000 per minority student.

Another perspective emerges when annual Minority and Disadvantaged resource costs are cumulated over the ten-year life of Plan 2008. The total resource cost of the Minority and Disadvantaged program component of Plan 2008, expressed in constant 2009 dollars, is estimated at $270 million, slightly more than a quarter billion dollars.

Adding the resource costs from 2008-09 and 2009-2010 would push this total to approximately $360 million, more than a third of a billion dollars.

These two perspectives raise questions about the benefits of UW-Madison's Minority and disadvantaged programs. First, what benefits did these programs produce and how were these benefits distributed among targeted minority students and the rest of the student body?

Second, how do the benefits from these programs contrast with the resource costs devoted to them? Are the benefits sufficiently large to warrant the current allocation of resources to these programs?

The larger question is this. Why are campus officials, faculty, students and the general public in such a poor position to decide whether to devote more or fewer resources to Minority and Disadvantaged programs? The answer is simple. Little or nothing is known about the effectiveness of these programs because few if any of them have been rigorously evaluated.

Such information, if available, could be of great value to UW-Madison officials in the coming months. That is when they must decide how to absorb the substantial budget cuts imposed for the 2011-2013 biennium. Without this information, they will have to rely on "seat of the pants" judgments about the effectiveness of continued spending on Minority and Disadvantaged programs.

My guess is that their commitment to "diversity" is so strong these programs will escape the budget ax. Any reduction would trigger much feared charges of "racism."

W. Lee Hansen is a professor emeritus of economics at UW-Madison; wlhansen@wisc.edu.

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