Trans World Assurance Blog

Trans World Assurance Higher Education Series: Private Schools

Posted on Thu, Jul 28, 2011

Trans World Assurance Higher Education Series: What is a Private College or University?

transworld college 4In the United States, we differentiate between public and private colleges and universities. The technical, legalistic distinction is in how each is governed. Public institutions are governed by state appointed or approved Trustees, who are responsible for setting tuition rates, approving the hiring of senior staff, and determining that the institutions are meeting broad-based educational goals of the state. In return for this control, state funds (your taxes!) subsidize the cost of educating public college and university students. Private colleges, unlike public institutions, receive little or no direct financial support from their state legislatures. This means two things:

1. They must look to other sources of income, including more reliance on tuition and support from alumni, foundations, and corporations; and,

2. They are not governed by publicly appointed Boards and have more freedom in how they operate. Both and pubic and private institutions also receive indirect support from financial aid (scholarships, loans, jobs) given directly to students from state and federal sources.

transworld college 3

The nation’s first colleges, beginning with Harvard in 1636, and the first universities (University of Pennsylvania, 1740) were private, not public, institutions. As you can see from the previous table 1,676 colleges are private (71% of four year institutions) and, at the Bachelors’ degree level, they enroll 35% of all full time students. 46% of the U.S. Congress graduated from private colleges, as did President George W. Bush, his father, Bill Clinton, John Kennedy, and Richard Nixon. In fact, 22 of the 33 college-educated Presidents of the United States graduated from private colleges or universities. Furthermore, 50% of business/corporate CEOs (Chief Executive Officers) and senior executives with undergraduate degrees graduated from private colleges and universities.

Public and private colleges and universities are approved, or accredited, by the same agencies. These agencies, which in turn are accredited by the federal government, approve of the overall mission, financial health, and success of meeting each college’s stated goals and objectives. The colleges are reviewed periodically by professors and senior staff of peer group institutions. In addition, major fields of studies, such as business, nursing, teacher educations and so forth, may also have accrediting organizations. The point is, both public and private schools are subject to the same rigorous peer-review process to insure that students are offered uniformly high standards of learning.

Tags: Trans World Assurance, college planning, college funding, save for college