The catch-22 reaction is not surprising, for academic culture tends to conflate total expenses and total revenues—as the budget—while too seldom identifying and managing unit costs.  This tendency obscures the high probability that policy makers expect higher education to innovate internally, both to improve the academic aspects of institutional performance and to reduce unit expenses, the latter in order to stabilize tuition and reduce the need for relative increases in tax-supported revenues.  The prevailing academic culture, instead, perceives a catch-22 vise squeezing nonprofit higher education ever more tightly between revenue/cost pressure, on one side of the vise, and, on the other, the pressure to meet institutional performance obligations (in the absence of new incremental per-student resources). 

Many institutions accordingly are seeking additional per-student direct or indirect public funding while simultaneously capping enrollments (thus reducing the capacity for access) and/or raising tuition (thus eroding the affordability of access).  Capping enrollments and raising tuition, however, can readily be perceived externally as a defensive or even arrogant response to the rising expectation for improved institutional performance—a response depicted graphically at the right as a worst-case scenario.  Capping enrollments and increasing tuition, moreover, do nothing à priori to reduce unit costs and measurably improve academic quality—lower student/instructor ratios and higher tuition not being linked, à priori, to measurable improvements in learning.  Instead, such actions tend to freeze unit costs and manipulate enrollments and price to make total costs and revenues match—hardly a strategy for improving institutional performance.  A more proactive strategy would start by differentiating expense accountability and the affordability of access—as is done in Table 1—in order to focus attention on price as a function of unit cost, a relationship often overlooked by nonprofit institutions that have never been threatened with closure through cost overruns.