3 ms·

Precisely. I remember my university taking 35% off the top of all grants for a lab that was 30 years old (hadnt been updated), and a sufficient but hardly cutt

by refurb 2y ago

Precisely. I remember my university taking 35% off the top of all grants for a lab that was 30 years old (hadnt been updated), and a sufficient but hardly cutting edge instrument room. The university was getting far more money than if the PI rented lab space at an incubator.

jltsiren 2y ago
That's a naive understanding of grant overheads. Only a portion of the overhead is used for facilities and services directly used by the PI and their lab. The rest are better understood as federal subsidies to research universities. The funds are allocated according to the ability of the university to win competitive grants, rather than via a political process or a rigidly specified funding model. At my university, 44% of the overheads go to the general fund, 34% are used to support research in various ways (including startup funds for new faculty), and 22% goes to the administration. For grants with the normal 56% overhead rate, that means 16%, 12%, and 8% of the total. Grant overheads are good for the university, because they mostly come with no strings attached. The university is free to spend them as it sees fit, rather than according to what some big important outsider says.
- refurb 2y ago
  Sorry, that argument falls flat. We're talking about schools with multi-billion dollar endowments, new sports stadiums, branded new facilities, fat tuition fees from international students and a ton of pet projects by the university. But no, the NIH needs to "subsidize" general fund through NIH grants? > The university is free to spend them as it sees fit, rather than according to what some big important outsider says. That's fine, but let's not pervert the research funding mechanism by puffing up indirect costs to pay for things that have nothing to do with research. That seems reasonable to me?
  - jltsiren 2y ago
    I believe the median endowment of an R1 university is around $1 billion. That corresponds to $30 million to $40 million of sustained income a year. Enough to fund a single reasonably large academic department, or about as much as grant overheads. Except that universities usually can't use their endowments as they see fit. Big donors often prefer funding fancy buildings and other singular things over daily operations. Tuition fees are already too low in most public research universities. Combined with the decline of state funding over the decades, many of them are now facing major budget cuts. Take away grant overheads, and you'll start seeing tenured faculty laid off and entire departments closing. And this is not a perversion of the research funding mechanism but deliberate policy. Back in my previous life, when I was somewhat involved in educational policy in another country, I saw a shift to a similar policy partially inspired by what was already done in the US. The government took a big chunk of core funding for universities, gave the money to research funders, and significantly increased overhead rates. Instead of awarding money based on opaque negotiations between universities and the government, which were prone to corruption, that money would be given according to competitiveness in research.
    - refurb 2y ago
      What struck me most about your response is what you hear from all the stakeholders when it comes to reforming the healthcare system in the US - you talk to each individual stakeholder and they'll give you a list of reasons why they aren't the problem and how they couldn't possibly get by on less money. Doctors talk about how their salaries, the highest in the world, couldn't possibly be lower and blame insurance and the hospitals. Hospitals tell stories about all the uncompensated care they provide, how they can't tell doctors how to practice and how patients would be dying on the streets if they got $1 less and the problem really lies with doctors and insurance. Insurance companies talk about how hospital spending is out of control and most of the money is paid out in claims and how doctors fees have exploded. Etc, etc, etc. The truth is that the cost of university has skyrocketed over the past few decades. University budgets have grown well beyond inflation for decades. The administrative class has exploded in terms of head count and campuses have gotten more and more luxurious (try comparing them with one in Europe or Canada!). In the end if universities couldn't possible move money around to cover what amounts to a few percentage of their total budgets, then I don't know what to say. Maybe the slate needs to be wiped clean and we start again with a system that makes more sense in terms of where the dollars come from and go.
      - jltsiren 2y ago
        I haven't seen any luxurious campuses in the US, though I don't have much experience with student housing and services. Some departments are baseline modern office buildings, while others remind me more of Latin America than Europe. And some would be eerily similar to the USSR, if you painted them light blue. Large part of the cost explosion is simply Baumol effect. In particular, universities employ many professionals, and professional salaries have grown ridiculously high in the US. Median full time income is something like $60k, which means that anything above $120k should be high income by the usual definition. But if you ask a professional, $120k is not a particularly good salary. Another large part is the growth of mandatory spending. Roughly speaking, many administrators are mandatory, because they exist for external reasons. Universities cannot cut them, unless the external environment changes. The more regulations and expectations there are, the more administrators universities require. Then there is the issue that American students expect to be taught, which makes education more expensive. I studied in a European university, where the curriculum was structured around exams. Classes were offered when the resources allowed it, but you were expected to pass the exams regardless. Very convenient if you are sufficiently independent. And less so if you are not. The public research university I'm at recently had something like 15% deficit in core funding. Mostly due to tuition fees and state funding lagging behind inflation. There is simply no money to move around.

by refurb 2y ago

jltsiren 2y ago

That's a naive understanding of grant overheads. Only a portion of the overhead is used for facilities and services directly used by the PI and their lab. The rest are better understood as federal subsidies to research universities. The funds are allocated according to the ability of the university to win competitive grants, rather than via a political process or a rigidly specified funding model. At my university, 44% of the overheads go to the general fund, 34% are used to support research in various ways (including startup funds for new faculty), and 22% goes to the administration. For grants with the normal 56% overhead rate, that means 16%, 12%, and 8% of the total. Grant overheads are good for the university, because they mostly come with no strings attached. The university is free to spend them as it sees fit, rather than according to what some big important outsider says.

refurb 2y ago
Sorry, that argument falls flat. We're talking about schools with multi-billion dollar endowments, new sports stadiums, branded new facilities, fat tuition fees from international students and a ton of pet projects by the university. But no, the NIH needs to "subsidize" general fund through NIH grants? > The university is free to spend them as it sees fit, rather than according to what some big important outsider says. That's fine, but let's not pervert the research funding mechanism by puffing up indirect costs to pay for things that have nothing to do with research. That seems reasonable to me?
- jltsiren 2y ago
  I believe the median endowment of an R1 university is around $1 billion. That corresponds to $30 million to $40 million of sustained income a year. Enough to fund a single reasonably large academic department, or about as much as grant overheads. Except that universities usually can't use their endowments as they see fit. Big donors often prefer funding fancy buildings and other singular things over daily operations. Tuition fees are already too low in most public research universities. Combined with the decline of state funding over the decades, many of them are now facing major budget cuts. Take away grant overheads, and you'll start seeing tenured faculty laid off and entire departments closing. And this is not a perversion of the research funding mechanism but deliberate policy. Back in my previous life, when I was somewhat involved in educational policy in another country, I saw a shift to a similar policy partially inspired by what was already done in the US. The government took a big chunk of core funding for universities, gave the money to research funders, and significantly increased overhead rates. Instead of awarding money based on opaque negotiations between universities and the government, which were prone to corruption, that money would be given according to competitiveness in research.
  - refurb 2y ago
    What struck me most about your response is what you hear from all the stakeholders when it comes to reforming the healthcare system in the US - you talk to each individual stakeholder and they'll give you a list of reasons why they aren't the problem and how they couldn't possibly get by on less money. Doctors talk about how their salaries, the highest in the world, couldn't possibly be lower and blame insurance and the hospitals. Hospitals tell stories about all the uncompensated care they provide, how they can't tell doctors how to practice and how patients would be dying on the streets if they got $1 less and the problem really lies with doctors and insurance. Insurance companies talk about how hospital spending is out of control and most of the money is paid out in claims and how doctors fees have exploded. Etc, etc, etc. The truth is that the cost of university has skyrocketed over the past few decades. University budgets have grown well beyond inflation for decades. The administrative class has exploded in terms of head count and campuses have gotten more and more luxurious (try comparing them with one in Europe or Canada!). In the end if universities couldn't possible move money around to cover what amounts to a few percentage of their total budgets, then I don't know what to say. Maybe the slate needs to be wiped clean and we start again with a system that makes more sense in terms of where the dollars come from and go.
    - jltsiren 2y ago
      I haven't seen any luxurious campuses in the US, though I don't have much experience with student housing and services. Some departments are baseline modern office buildings, while others remind me more of Latin America than Europe. And some would be eerily similar to the USSR, if you painted them light blue. Large part of the cost explosion is simply Baumol effect. In particular, universities employ many professionals, and professional salaries have grown ridiculously high in the US. Median full time income is something like $60k, which means that anything above $120k should be high income by the usual definition. But if you ask a professional, $120k is not a particularly good salary. Another large part is the growth of mandatory spending. Roughly speaking, many administrators are mandatory, because they exist for external reasons. Universities cannot cut them, unless the external environment changes. The more regulations and expectations there are, the more administrators universities require. Then there is the issue that American students expect to be taught, which makes education more expensive. I studied in a European university, where the curriculum was structured around exams. Classes were offered when the resources allowed it, but you were expected to pass the exams regardless. Very convenient if you are sufficiently independent. And less so if you are not. The public research university I'm at recently had something like 15% deficit in core funding. Mostly due to tuition fees and state funding lagging behind inflation. There is simply no money to move around.