Thoughts on business, engineering and higher education

A Convex Optimization Framework For Multi-Agent Motion Planning

Two weeks ago, I attended Jason Derenick's dissertation defense, entitled - you guessed it - "A Convex Optimization Framework For Multi-Agent Motion Planning". Jason was a graduate student in the Computer and Engineering Department at Lehigh, working under the supervision of John Spletzer; he has now moved to the University of Pennsylvania, where he is a postdoctoral fellow in the GRASP (General Robotics, Automation, Sensing and Perception) laboratory.

I served as a member of his dissertation committee, which is how I got to learn about his research. It turned out I had heard about him before - he was one of the team members behind the "Little Ben" car in the 2007 DARPA Urban Challenge. That car "was one of just six driverless cars to complete the 2007 DARPA Urban Challenge and it was the only car of the six finishers whose team had not received $1 million funding from DARPA to prepare for the race," according to Lehigh's press release.

In his dissertation, Jason has exploited recent advances in convex optimization to develop real-time algorithms for motion-planning problems, with an emphasis on optimal team formation changes and optimal collaborative target tracking. These problems lead to second-order cone programming and semidefinite programming formulations, respectively.

I was very impressed by Jason's work, and the wonderful presentations he makes of it. Of course, I only got to see the product of his research in its final stages, not the six years of hard work leading to it, but it is refreshing to bypass the difficulties and hurdles of graduate work for once (I've got my own students for that) and be shown the finished product without all the setbacks. While this is true of any committee I serve on, including for students in my own department, I particularly enjoyed the application to robotics - a departure of my usual line of work and a welcome reminder of my days as an undergraduate.

One reason why people - myself included - can get so enthusiastic about the work is that Jason excels at disseminating his results and explaining them at a high level anyone can understand (it is fair to say he is the National Science Foundation's dream research assistant). In addition to designing an excellent website, he has posted on his dissertation webpage an outline of his research and several videos and simulations of his algorithms in action. My favorite is the one with the aibos taking a delta formation, because everyone likes dogs, even robot ones.

Renting Textbooks

The local community college in my area recently announced that it was planning on making some textbooks available for rental and as electronic books, in a move that is expected to save students up to $400 a semester. This is particularly welcome given the composition of community colleges' student body, with a large fraction of working adults who can't count on their parents to foot the bill and might have a family to support.

College publishers are notoriously reluctant to do anything that could reduce their considerable margins, so I don't have any great hopes regarding the future of the electronic textbook, although e-books could easily replace course packets (a collection of documents that copy services has traditionally printed for students at a fee after handling all the copyright issues.)

The idea of renting textbooks is intriguing, though. It is far from being new - it was already mentioned in 2003 in a New York Times article about publishers' practice of charging less for textbooks they sell abroad (foreign students are less willing to pay eye-popping amounts of money for their textbooks; publishers have adjusted to this situation by producing a soft-cover edition for the international market and a hardcover one for the US, although it is fair to say that any US student would be delighted to buy a soft-cover, cheaper book with the exact same information in it). The current economic crisis has lent a new urgency to cost-saving measures, and brought textbook rental back into the limelight.

The best overview article I have found on the practice is "New Options for Cheaper Textbooks" by Stephanie Kang, in the Wall Street Journal edition dated August 24, 2004. While it portrays publishers' efforts to make textbooks more affordable in a surprisingly favorable light (I have never heard or witnessed anything suggesting publishers were "aggressively pushing online versions of texts or no-frills soft-cover versions"; on the other hand, it seems that the article was written at a time when publishers worried about legal intervention from Congress), it also mentions well-known practices such as "issuing new editions with a few changes that make less expensive, older editions obsolete," which means that students cannot buy their book on the used market where the publisher does not get any royalties. This allows the publisher to keep sales strong on the primary market.

As an example, one of my favorite textbooks, Options, Futures and Other Derivatives, by John Hull, is in its 7th edition, which was published in May 2008 at a sticker price of $200 ($145 on Amazon). But, according to Amazon.com, the 6th edition was published in June 2005, the 5th in July 2002, and the 4th in January 2000. While the various editions do contain some (limited amount of) new material - publishers have to justify their actions - it is hard to believe the developments are so critical that they cannot wait two or three more years, dividing the number of editions by two. (Better yet: the publisher could put the new chapters on a password-protected site that students who bought the textbook would access for free.) But of course that would not be in publishers' interests.

It is not clear whether textbook rental will turn into a credible threat to publishers' bottom line, but it certainly seems on track to save students money. The WSJ article states: "According to the California Public Interest Group, students will spend as much as $240 a year renting textbooks, compared with the nearly $900 on average spent purchasing books." That one-to-three ratio is in line with the numbers my local community college came up with.

From the perspective of a revenue manager, the practice is interesting because it allows for the segmentation of the used-textbook market between students who want a cheap book they plan on keeping, and students who only care about having the book while they take the course. These groups' different willingness to pay translates into different prices. Sadly, segmentation usually translates into a price increase for one of the groups, unless the bookstore manager has suddenly become willing to decrease his revenue. (More on that at the end of the post, with the example of the psychology textbook.)

Adding one layer of complexity to the problem, campus bookstores also give students the option to purchase their rented textbook - and get a refund for their rental fee - if they make up their mind early enough in the semester (see for instance this Eastern Illinois University website). Other universities, such as the University of Wisconsin-Whitewater, have incorporated the rental fee in their tuition. An obstacle to a widespread implementation of the program is that instructors must commit to using the same textbook several semesters in a row ("Teachers must use a text for as many as three years before asking for a new one," from the WSJ).

In addition, it turns campus bookstores into inventory management centers of a scale they were not planned for ("Schools may spend anywhere between $90,000 and $1 million a year on new purchases in rental programs, while up to a third of their inventory may lay unused each semester. Storing the books and making sure they are in good enough shape for the next semester add to administrative costs.")

My local newspaper gives the example of a psychology textbook, which costs $133 new, $75 used and $40 rented. Assuming that the number of students who do not want to buy a textbook new remains constant over the years, the old price of the used textbook would have to be 40+35*r, where r is the ratio of people now buying used (not renting) over total number of people now in the secondary market (buying used or renting), to bring in the same amount of money as before. This number is between the two extremes of $40 and $75. Said differently, the old price of buying a used textbook, before the rental option was implemented, will be lower than its new price of $75.

The economic crisis might invalidate the assumption above that the number of students who do not want to buy a textbook new remains constant - instead, that number might increase. But that also would take sales away from the new-book market, further decreasing the bookstore's revenue. As an example, it is not too difficult to check that, if n is the total number of people now in the secondary market (renting books or buying them used), and n' is the number of people who used to be in the secondary market (buying their textbooks used before the rental option became available), (93n-58n')/35 people would need to buy their textbooks used to keep the sales at their previous level, if the used-textbook price does not change (that is, if $75 was the old price too). With an increase in interest to buy used or rent of 20% because of the crisis (from 100 to 120), you'd need to get 153 people to now buy used in order to bring in the same amount of money as before, but that's bigger than the whole secondary market of 120 people. A 10% increase yields an increase bigger than the whole secondary market too.   

In other words, either the college bookstore voluntarily decreases its sales by decreasing the price for students who want to pay less (by opting to rent their textbook), or it finances that cheaper option by charging the students who buy their used textbook more.

But... these numbers were obtained assuming the total enrollment in the course does not change from a year to the next. Community colleges have seen enrollment increase. There are many possible explanations for that trend, including the fact that parents prefer to send their offspring to a community college for a year or two to take care of the required courses at a bargain-basement price, before transferring to a four-college university for their junior or senior year; another possibility is that more high school or college students take a course or two at their local community college to get rid of, say, the introductory calculus course or the social science course required from all engineering students (not something they find critical to their studies, although it's good for them.)

So - and this is pure speculation, because I haven't seen any numbers - the segment of the community college's student body with the highest willingness to pay might be increasing. Since those students typically enroll at the community college near their parents' home, they pay the same tuition as the working mother of four trying to get her Associate's Degree, but they are somewhat less sensitive to price. Increasing the cost of their course materials by a small amount would subsidize the expenses of the hard-working parent trying to get herself a better future and make the rental option viable.

On the other hand, if the better-off students enroll in a community college as a short-term measure to fulfill requirements they don't really care about, they might end up renting their books, while the cash-strapped students who do need to keep the books as reference for the rest of their studies (and therefore will buy them used) will see their bill increase. This would be the worst possible outcome - making students who can afford to pay more pay less, and making students who really need to pay less pay more.

It'll be interesting to see how this all plays out.

The Bond Swap Crisis

The foray of my current hometown into bond swaps is making the local news again. I wrote in October about the deal, which was supposed to save taxpayers money but has turned into a full-scale fiasco (board members have admitted that they did not understand the mechanisms behind the swaps, but approved them anyway); the board has now voted to end the swap and enter a fixed-rate bond agreement instead ("Bethlehem School District OKs refinancing troublesome variable-rate debt", Morning Call, April 7, 2009).

Stories of swap deals gone bad abound in the media. Issues have arisen because of the unexpected change in variable rates, but also because the downgrade of companies insuring the swaps prompts the banks on the other side of the contract to ask for additional payments, as the Massachusetts Turnpike Authority is finding out at its own expense ("MassPike Swap Payment A Looming Threat," The Bond Buyer, January 14, 2009).

This Investopedia.com article ("An Introduction to Swaps") presents an excellent overview of interest rate swaps. (Also see the Wikipedia page on interest rate swaps and "Options, Futures and Other Derivatives" by John Hull [a great reference book].) In the simplest swap, called "plain vanilla", Party A agrees to pay Party B a predetermined fixed interest rate on a notional principal (more on that later) at predetermined times - the settlement dates - and Party B agrees to pay Party A a floating interest rate on the same notional principal at the same settlement dates.

As an example, the Bond Buyer article provides numerical figures for the MassPike rates: "Under the five swap agreements, MassPike pays UBS fixed rates of 4.75%, 4.875% and 5%, and receives in return 68% of Libor [rate of interest offered between banks for fixed-term deposits] from the bank. One-month Libor is now 0.33%, down from 4.56% three months ago, meaning the state is receiving about 0.2244%." The MassPike situation was also the focus of a Wall Street Journal article in October ("Massachusetts Turnpike Big Dig 'Swaps' Backfire," November 26, 2008).

The floating interest rate in the swap is typically measured in reference to the Libor plus a margin, expressed in basis points (1bp=0.01%). As a side note, the floating rate used to calculate a payment is the one observed at the previous settlement date - if, for instance, payments are made every six months and the 6-month Libor is used as reference for the floating rate, Party B will always know six months in advance what its next payment will be. (This sounds like a minor detail but impacts the way the swap is priced.) The principal is said to be notional because there is no payment on it - only on the interest.

Swaps are used to convert fixed-rate payments into floating-rate ones, or vice-versa. Companies resort to swaps when they want to avoid a mismatch, if assets-related payments are of one type and liabilities-related payments are of the other. Furthermore, swaps allow companies to take advantage of (their view on future) market conditions. 

But swaps remain a bet - if there was a sure way to make money, the party at the other end of the contract would be losing money for sure, and why would they agree to that? Sometimes you win, sometimes you lose, sometimes you lose big. And, when you're a school district and the party at the other end is a bank, the asymmetry in information is so extreme that it makes you wonder why board members didn't realize earlier they risked being taken advantage of.

Case in point: the Erie City School District, whose plight is described in "Hidden swap fees by JPMorgan, Morgan Stanley hit school boards" (Bloomberg, February 1, 2009). Highlights: "an Erie-based JPMorgan Chase banker told [the school board] that all they had to do was sign papers he said would benefit them if interest rates increased in the future, and the bank would give the district $750,000." The district had severe cash needs and taxpayers could not afford another tax increase. The offer sounded too good to be true. It was.

"What New York-based JPMorgan Chase didn't tell them, the transcript shows, was that the bank would get more in fees than the school district would get in cash: $1 million. The complex deal, which placed taxpayer money at risk, was linked to four variables involving interest rates. Three years later, as interest rate benchmarks went the wrong way for the school district, the Erie board paid $2.9 million to JPMorgan to get out of the deal, which officials now say they didn't understand." Why do school boards not understand that they risk being taken advantage of if they don't resort to competitive bidding?

The school district even sued JP Morgan, but the suit "was withdrawn in the U.S. District Court in Pennsylvania after an identical lawsuit was thrown out in New York where a judge said the transactions aren’t covered by securities laws." (Bloomberg, April 8, 2009)

JP Morgan is not the only company being sued. Last month, a North Carolina judge blocked Wachovia from "foreclosing on [a shopping center owned by a developer] until a trial on claims that Wachovia wrongfully terminated a derivative interest rate "swap" agreement. [...] Wachovia has argued it is entitled to a $5.48 million termination fee." (Reuters, March 26, 2009)

The lawsuit "asserts Wachovia has engaged in extortion, fraud, and unfair and deceptive practices." A finance professor at the University of North Carolina's Kenan-Flagler business school even testified that "if the termination fee is calculated as provided in Wachovia's sales presentation and consistent with the purpose of the swap agreement, the bank would owe [the developer] a termination fee of about $2 million." 

But JP Morgan does appear in swap-related articles a lot, and not in a good way. For instance, "an Alabama agency that finances school construction won’t make payments due to JP Morgan Chase under a derivative trade until a U.S. court rules on the state’s lawsuit seeking to have the contract thrown out." (Bloomberg, April 8, 2009) And "the bank also is embroiled in negotiations over how to resolve a debt crisis with Jefferson County, Alabama, where the county's former adviser says a group of firms led by JPMorgan [...] overcharged it by as much as $100 million for financing a new sewer system." (Bloomberg, September 4, 2008) A last one: "JPMorgan lured municipalities [such as the New Castle School District] into derivative deals by offering upfront cash payments in exchange for a pledge by the local government to agree to enter interest-rate swaps with the bank at a future date." (Bloomberg, October 27, 2008)

In September, JP Morgan announced it would "stop selling interest-rate swaps to government borrowers." But have the school districts learned their lesson? In Bethlehem, "[the Board President] said the emphasis on repaying debt is new. Previously, if construction bids came in lower than expected, the board put the leftover money toward other construction projects." (Morning Call, April 7, 2009) Back in October, the Express-Times - our other local newspaper - explained part of the school district's troubles as follows: "Bethlehem didn't bank its proceeds and spent all of the roughly $7 million it received up front in the swap deals." (Express-Times, October 19, 2008) With that kind of government, we're not at the end of our problems.

Pennsylvania in the News

The Engineers and the Fire that Wouldn't Die. The Economist recently ran an article about engineering in its US section (as opposed to Science and Technology). It caught my attention because it was about a town in my current home state of Pennsylvania. The article, entitled "Fire in the Hole" (March 12, 2009), describes the plight of Centralia, where a below-ground fire "began in 1962 when residents burned some rubbish on top of an exposed coal seam." It turns out that there are "36 fires currently blazing in Pennsylvania's 180,000 acres of abandoned mines."

The Centralia fire is the most famous because a 12-year-old boy was swallowed by a hole in 1981 that opened in his grandmother's backyard (he survived by hanging to exposed roots and was pulled out by his cousin - the hole is said to have been 150 feet deep); most residents relocated in 1984 to neighboring municipalities and Pennsylvania revoked the town's ZIP code in 2002 (see Centralia's Wikipedia page).

A 1981 TIME article ("The Hottest Town in America") provides a fascinating description of the signs that betray the presence of the fire underground: "The steam rises from pipes in the middle of Route 61, from vents in the yard of a gas station, from six tall stacks on a hilltop to the right of the highway and from holes that have opened in the ground itself." (That part of Route 61 has been closed and the new Route 61 avoids the town.) The TIME article explains that "Many townspeople assumed that if they ignored the fire it would eventually burn itself out. It did not." Instead, it has now been burning for 47 years. From The Economist: "Evacuating people has proved cheaper than trying to put the fires out."

Enters a Pittsburgh-based engineering company, GAI consultants. It has developed a concrete-like substance, which starved a small below-ground fire of oxygen and successfully extinguished it. Although the substance "begins to harden soon after being mixed," making it hard to use for large-scale fires like Centralia's, it represents the best hope yet of - some day - putting an end to all the fires smoldering out of sight in Pennsylvania.

ISE's 60th Anniversary

Yesterday was the celebration of my department's 60th anniversary. The day-long event was remarkably well-attended, with about 200 alumni coming back. Dean of the College of Engineering and Applied Sciences (and past department chair) David Wu and university president Alice Gast even joined us for the banquet on Lehigh's Mountaintop campus. We in the department have our amazing Communications Specialist Amanda Fabrizio to thank for turning this high-profile celebration into a resounding success, despite having been at Lehigh only five months.

The student poster session was followed by a panel discussion about the past, present and future of the Industrial and Systems Engineering field, and the Schantz lecture, named after a generous donor to the department, which was delivered by Air Products CEO and department alumnus John McGlade. Mr McGlade made many insightful comments, for instance emphasizing the need for active listening, external awareness (adaptability), creativity in the face of adversity, and learning how to learn. I also thoroughly enjoyed the short video he showed afterwards (with permission), which apparently is well-known on the Internet but which I had never seen before - the statistics were definitely food for thought. (You can see a version of the video here, among other places.) Among other gems: "If you're one in a million in China, there are 1,300 people just like you" and "India has more honor kids than America has kids" (because "25% of India's population with the highest IQ is greater than the total population of America.")

But of course, my favorite part was to run into former students of mine, in particular George Berger, Christopher Gerlach and Kurt Lesker, all Class of '05 (the first course I ever taught!) and Katie Drewes '06. They are all doing very well and forging amazing career paths for themselves. I'm sure I'll keep hearing great news from them in the years to come.

The Inactive Market

Last month, the Financial Accounting Standards Board issued proposals "to improve guidance on fair value measurements and impairments". While fair-value accounting was promoted after the Enron debacle as a way to increase transparency regarding the value of companies' assets, it is now blamed for exacerbating the recent meltdown, because it has forced companies to take big write-downs on illiquid and hard-to-value securities (see this post I wrote back in January).

Opponents of fair-value accounting argue that valuing assets as if they were about to be sold today does not make any sense when managers are in fact planning to hold on to them for the long term - and they say it makes no sense at all now, when it is so difficult to find buyers for any financial instrument. In response, the FASB issued in March proposed guidelines to "determin[e] whether a market is not active and a transaction is not distressed." It is worth noting that bankers, whose behavior as a group has played a non-negligible role in the crisis, were the ones doing a lot of the finger-pointing, and that the FASB came under intense pressure from Congress to relax the rules.

The law firm of Morrison and Foerster posted an analysis of the new proposed directive on its website, back in March (many thanks to the person who sent me the link). Note that the guidelines, called FAS 157-e, was open for comments until April 1, and therefore might change again before its final implementation.

Morrison and Foerster explains that "FAS 157 permits a reporting entity to use a price other than the most recent trading price if the transaction is a distressed sale," but "it has been unclear [until the new guidelines] how broadly the distressed sale exception could be interpreted." It also lists factors that can be used to identify an inactive market, such as few recent transactions (no surprise there) or abnormally wide bid-ask spreads. This is the first step of the approach; if the market is identified as inactive, the second step is then to determine whether the transaction was distressed.

A notable feature of the Fair Value Proposal made in March was to "switch the focus from prior guidance by creating the presumption that transactions in inactive markets are distressed." The idea, as the Wall Street Journal reports in an April 2 article ("FASB: No Longer Distressed, Just Disorderly"), was that debt that had traded at distressed levels could be excluded from the models valuing similar debt. The concept of distressed transaction apparently was poorly received because vaguely defined, and the FASB emphasized the concept of "orderly transaction" instead at its April 2 meeting.

Forbes has called this loosening of the previous rules "mark-to-messy accounting change" (article, April 2, 2009), and The Economist ran a headline on April 8 stating "Messenger, shot - Accounting rules are under attack. Standard-setters should defend them. Politicians and banks should back off." The article ends with: "The FASB and IASB can help regulators to create whatever balance-sheet they want. But in doing so they must not compromise their duty to investors." The controversy about mark-to-market is far from over.

CELDi Conference

I just came back from the CELDi conference, which was held in Charlotte, NC this semester. CELDi stands for the Center for Engineering Logistics and Distribution, a university-industry consortium headquartered at the University of Arkansas, of which Lehigh is a member (click here for the official website). I also attended the Fall meeting in Dallas, TX, and I have to say that this is hands-on down the most useful and best-run conference I have been to, probably because of the high percentage of industry participants, and also of course thanks to the incredible efficiency of the extraordinary Karen Standley, administrative assistant at U. of Arkansas, who keeps everyone on schedule, gathers files for posters and presentations ahead of time, and makes sure the conference runs smoothly.

The format is on the minimalist side: people arrive the evening before and attend a networking reception, then the morning (from 8am to 11.45am with only one 15min break) is spent on project presentations and the poster session; the projects, which reflect a true partnership between universities and local companies, illustrate the incredible benefits that can be achieved when academia and industry collaborate on real-life problems. After lunch, the industrial advisory board discusses and evaluates new project proposals.

Everybody is done by 3pm, and the hotel is always right by the airport to avoid traffic jams and transportation times. This means that people can catch flights home easily. The conference is free for CELDi members and includes breakfast and lunch, as well as the evening reception. While the center will be financially supported by the National Science Foundation until 2012, it is already thinking about ways to establish its national identity beyond that, as "the" center for logistics research in the United States. 

My favorite part of the conference, besides presenting my project with Kevin Taaffe of Clemson, was to listen to the success stories of the Research Experience for Teachers (RET) program. RET is a NSF-sponsored program that "supports the active involvement of K-12 teachers and community college faculty in engineering research in order to bring knowledge of engineering and technological innovation into their classrooms."

We listened to two presentations. In the first one, Mark Thomas of Stillwater High School (in Stillwater, OK) described how a partnership with Oklahoma State University has helped him introduce operations research to his students, especially through the use of network problems. It turns out students don't view networks as math, and that's apparently a good thing (in the students' eyes). Instead, they view networks as puzzles, which they try to solve in the spirit of friendly competition against their classmates.

This has allowed the teacher to introduce concepts such as minimum spanning trees, shortest paths, maximum flow problems and the like. He has also developed short modules of 10-15 minutes, so that other teachers' students can also learn about networks without having to spend one whole lecture on the topic (teachers are reluctant to spend too much time on material that students won't be tested on in the state-mandated exams). He has also followed the freight movement project that Oklahoma State is currently working on with its CELDi industry partner, which has given him exposure to real-world data gathering and large-scale linear regression. I hope his course materials get widely disseminated.

The second presentation was about the redesign, by Virginia Tech seniors, of a workstation at a Walgreens warehouse for people with special needs (such as cognitive delays); the teachers involved work at Blacksburg Middle School. The project originated from a mandate in Virginia (which will take effect in 2010-2011) to better prepare students with special needs for adult life in the workforce, because the current unemployment rate for people with disabilities in the 16-64 age group is a staggering 44.2%. (I'm not sure if that's the rate for the state of Virginia or the whole country.) The teachers visited the Walgreens warehouse and learned of the efforts made to accommodate special-needs workers; this helps them give better advice to the parents of children with disabilities. It turns out that people with disabilities can perform simple tasks, such as packing boxes in a warehouse, extremely well when trained properly. (Walgreens has a job coach for them.) So the group of Virginia Tech seniors redesigned a workstation to help these people perform at their best. The teachers mentioned it's sometimes difficult to educate the parents, who worry their child won't be able to handle the unknown world of the workplace. It is also worth noting that Walgreens has all its employees - disabled or not - work eight-hour shifts; following the same schedule as abled employees is very empowering for special-needs workers. The Virginia Tech senior project on human factors (workstation design) further reinforces that people with disabilities can thrive in the right environment.

Lehigh News

The celebration of our department's 60th anniversary is gearing up to be a great success - we're expecting so many people that we've had to change the venue of the panel discussion. It's going to be a memorable event. We're looking forward to welcoming our alumni back!

Friday was CHOICES day at Lehigh - CHOICES is a program run by the Lehigh chapter of the Society of Women Engineers, with financial support provided by the College of Engineering. This is one of my favorite outreach events of the year, in addition to the Lehigh Valley Science and Engineering Fair held last March, where I judged ninth-grade physics projects. (The kids' creativity and talent never cease to amaze me.) I attended the CHOICES lunch and eggdrop competition, like last year; unfortunately, the severe thunderstorm made it impossible to drop the eggs outside. The idea behind the eggdrop competition is that the kids are given one real egg, an empty carton of orange juice, 12 [fake] dollars and a list of items they can "buy". They must decide how to spend their money to best protect their egg from a fall. Then they are judged on the weight and originality of their design, and of course, on whether the egg survives the fall intact. To test the eggs anyway, someone found a ladder, climbed to the top, and dropped the eggs indoors. It was still a lot of fun.

Registration for the Fall just opened. Out of curiosity, I checked the enrollment for the senior elective I teach every Fall. Fifty-three students already! I don't think I've had a class that big since my first semester at Lehigh. It'll be interesting to teach such a large group - challenging, but interesting. The more students I meet, the happier I am to work here (the quality of the students compensates for some aspects of the Lehigh Valley I am not quite as fond of), so large classes are good for me, although it can be harder to make students participate. I felt quite old when I browsed through the class roster, because I noticed the names of two students I advised when they entered Lehigh as freshmen (I am an academic advisor for the first-year engineering students) - it's hard to believe two years and a half have gone by since I first met them after the convocation in Packard Auditorium and they're getting ready to graduate. Then one of my young-ish colleagues told me one of his students this year has turned out to be the son of a former student of his. Nothing can beat that.

The Latest On College Admissions

Ever since the economy started its long spiral downward, education commentators have fretted about the consequences for college admissions. Applications have surged at public universities ("As economy unravels, applications surge at US public colleges," New York Times, March 2, 2009) and at places like Cooper Union, with its need-blind full scholarships ("Applications surge at Cooper Union," NYT, February 8, 2009). That fitted journalists' view that the state of the economy was affecting college strategies in many households.

But applicants' behavior has also defied expectations: "Early-Decision Applications are Up at Colleges, in Spite of the Economy" (NYT, November 20, 2008), which was surprising because those early-decision applications were to selective and expensive colleges. According to the article, this might have indicated an aversion to uncertainty in those very uncertain times - a desire to gain clarity in at least one aspect of families' life. This week, colleges mailed their acceptance letters and publicized their admission rates: it turns out that, "For Top Colleges, Economy Has Not Reduced Interest (Or Made Getting In Easier)" (NYT, March 29, 2009, with additional statistics in a March 31 post) But since the regular-admission offers aren't binding, it's hard to believe students would not have applied at all to the colleges they've been dreaming of for the past few years. Then what the more competitive admission rate suggests is that some slightly less qualified applicants could have tried their luck, maybe hoping that other students' worse economic situation would force the "brilliant but suddenly poor" applicants to enroll elsewhere and get wealthier kids in the door.

This theory is pursued in more depth in "Paying In Full as The Ticket Into College" (NYT, March 30, 2009) For instance: "[Colleges] say the inevitable result [of the current crisis] is that needier students will be shifted down to the less expensive and less prestigious institutions. “There’s going to be a cascading of talented lower-income kids down the social hierarchy of American higher education, and some cascading up of affluent kids,” said Morton Owen Schapiro, the president of Williams College and an economist who studies higher education. [...] Some admissions officers and college advisers say richer parents are taking note of the climate, calculating that if they do not apply for aid, their children stand a better chance of getting in." A college conselor comments: “And anecdotally, it would seem that that’s the case.”

It's hard not to see articles like that as written to stoke outrage against wealthy people, those evil Americans who profit from others' misfortune. Now, the furor over the Merrill Lynch and AIG bonuses was completely justified, and bankers and investment bankers rightly get little respect these days - someone has to bear responsibility for the crisis. But it seems that people forget that, if the jobless rate has just hit 8.5% as announced today, 91.5% of the population still has a job. Not every affluent American has made his fortune on Wall Street. People do sometimes become very rich on merit alone (gasp), and that also includes financiers.

Apparently, that's something a segment of the population finds hard to understand. I would never have expected people to stoop so low as to make death threats against AIG bonus recipients ("AIG seeking returns of half of its bonuses", NYT, March 18, 2009). Death threats! This pathetic behavior reminds me of a superb book I read recently, "A Hope In The Unseen" by Ron Suskind. I'll write more on the book in another post, but it follows a talented black kid in inner-city DC, attending what is said to be the worst public school in the nation, hoping against hope to get out of his blighted neighborhood - think drugs and gunshots everywhere - to attend an Ivy League school. (And he does. And he graduates from Brown with a 3.3 GPA.) The open hostility of the other high school kids, who resent the fact that the boy has academic dreams while most of them either won't graduate or will drop out of community college or won't go because they can't afford it, or will simply choose to run with a different crowd - dealing drugs, ending up in "the system" - echoes the current situation in an eerie manner, except that grownups who should know better are the ones behaving like envious teenagers.

The public hysteria about people who haven't yet lost all of their hard-won savings can only reinforce college-bound teenagers' perception that it's better not to be too different, too ahead of the pack, because all the hoopla about achieving the American dream turns into smoke when the going gets tough, and who wants to have death threats leveled against them? It is a cliche by now to say that people's true character is only unveiled in trying times, but trying times are upon us indeed and I don't like what I'm seeing.