North Dakota's Higher Education Boom
I've featured the booming, oil-rich North Dakota economy many times, some recent examples appear here, here, and here. And now there's another economic success story for the state: a higher education boom is taking place at North Dakota's universities, with college students flocking to the Peace Garden state in ever greater numbers, according to this New York Times story titled "Frigid North Dakota Is a Hot Draw For Out-of-State College Students":
"Even as the number of North Dakota high school graduates fell below 7,400 in 2010 from 9,058 in 2000, enrollment at public colleges surged, climbing 38% in the decade ended in 2010, to 48,120. Leading that growth was a 56% jump in nonresident students.
Out-of-state students account for about 55% of the 14,500 enrolled at North Dakota State University, as well as at similarly sized University of North Dakota in Grand Forks. Nonresident students at North Dakota's 11 public colleges constitute a higher ratio than in almost every other state.
High school juniors and seniors scouring online college guides find North Dakota universities are inexpensive and well-regarded, with modest-sized classes typically taught by faculty members rather than adjuncts or graduate students."
27 Comments:
Wait! What are they saying? That competition for students has kept prices low AND improved the education product?
Who could have suspected anything like that?
I wonder if something like that would work at the primary & secondary level?
Ron H, is it competition or increased funding from higher tax revenues?
Feom the WSJ article cited:
"For other states, competing with North Dakota on the cost of education is difficult. As other states battle budget shortfalls, oil revenues this past year enabled North Dakota to run a billion-dollar surplus, and to fund a 13.4% increase over two years in appropriations to the North Dakota university system. That followed higher-education budget boosts of 20.6% in 2009 and 13.5% in 2007."
BTW, I don't argue that compeition drives down cost but so do big subsidies.
I sense Dr. Perry is contemplating a future in North Dakota.
Buddy,
I agree, it is because of higher tax revenue. But, they have been able to attract more out of state students, while other states have been unable to, by competing on price and product quality.
This is a testament to the power of the market. Something, it seems, we see few examples of in education these days.
I hate to be a skeptic again but I am beginning to wonder how much all of this 'good news' has to do with the Bank of North Dakota, which is the only state owned bank in the country and responsible for much of the loans made to shale drillers that have yet to turn a profit, and other ventures that may not be economically viable. As I argued before, the shale gas story is not working out well for investors looking for positive cash flows. If the loan losses are eventually recognized it is very possible that the people of ND will find themselves in a very tough situation once the easy credit dries up. I suspect that we will know one way or another in the next 36 months.
And then there is this from my old alma mater:
http://online.wsj.com/article_email/SB10001424052702303678704576440014119968294-lMyQjAxMTAxMDEwNDExNDQyWj.html#articleTabs%3Darticle
You could not pay me enough to go to school in North Dakota.
"The Bank of North Dakota"? That's interesting.
Reminds that states like Idaho often have state-owned utilities.
Of course, most of the rural Midwest is deep into federal subsidies, and North Dakota is one of the most heavily subsidized states.
To VangeIV: It is not a "natural gas" play in North Dakota. It is an "oil" play and the companies are doing quite well with $100 oil. The Bank of North Dakota has nothing to do with the success of the Bakken shale oil play. North Dakota is now the number 4 producer of oil in the US, behind Texas, California, and Alaska. ND appears likely to surpass Alaska's oil output in the near future.
From the Bank of North Dakota website:
"Beginning and Established Farmer-Rancher Financing Programs
Any farmer or rancher will tell you that the business of agriculture is more difficult today than it has ever been. The challenges to the young or beginning farmer are even greater. To meet those challenges, Bank of North Dakota (BND) offers a number of farm loan programs that make financing more affordable and easier to access.
BND provides direct financing of farm real estate through the following:
Beginning Farmer Loan Programs allow up to $400,000 to finance real estate purchases and an additional $400,000 to finance chattels at below-market interest rates.
The First Time Farmer Finance Program is administered through BND as well. The program provides funding to purchase farm real estate or equipment at a tax-exempt rate. No more than $250,000 of the $477,000 aggregate loan amount can be used for Agricultural improvements and Depreciable Agricultural Chattel Property. In addition, within the $250,000 limitation, no more than $62,500 can be used for Depreciable Agricultural Chattel Property.
Established Farmer Real Estate Loan Program allows up to $1,500,000 to finance real estate debt over an extended term with competitive fixed and variable interest rates."
Yes, let's help the American farmers, the most subsidized, molly-coddled, enfeebled economic weaklings on the planet.
Imagine a state-owned bank that said, "Starting a restaurant up in a big city is harder than ever, and failure rates are above 50 percent. Therefore we have loans blah, blah, blah. "
I seriously doubt the Tea Party will ever mention this noxious bank,
Hydra says: "You could not pay me enough to go to school in North Dakota."
How much would you want for this guy at the University of North Dakota to teach you economics? :)
http://business.und.edu/homepages/peris/
"I hate to be a skeptic again but I am beginning to wonder how much all of this 'good news' has to do with the Bank of North Dakota..."...
LMAO!
No vangIV I'm NOT laughing at you or your comment...
Someone sent me this commentary very recently: Secession, State Banks And The Power Of The Purse
Its kind of a moonbat like commentary...
To VangeIV: It is not a "natural gas" play in North Dakota. It is an "oil" play and the companies are doing quite well with $100 oil.
I do not believe that this is true. The data that Mark posted quite some time ago showed a depletion problem that had average flow rates of less than 150 barrels per day, hardly profitable when you are looking at the sweet spot in the shale formations and wells that cost $4 million plus. The reported 'profits' depend on valid EUR and depletion assumptions.
And where are you getting the $100 price for North Dakota Sweet? The last time I looked, Brent was going for $100, the price for WTI was 15% lower and the price of North Dakota Sweet was 35% lower. That put the price at $65, not $100.
The Bank of North Dakota has nothing to do with the success of the Bakken shale oil play.
You may be correct but from what I have been hearing the bank has been quite willing to lend money while most US banks have been tight. While most of its business is in the agricultural area, which is the primary reason why ND has done as well as it has, I suspect that ND drillers are taking full advantage of the availability of lons from the bank to finance their drilling activities or use them as leverage to get better terms from other banks.
North Dakota is now the number 4 producer of oil in the US, behind Texas, California, and Alaska. ND appears likely to surpass Alaska's oil output in the near future.
As I have pointed out previously, ND's 'success' is due to drilling activity, not energy profits. Given the poor economics of shale oil the area is vulnerable to another economic contraction that would lower prices at the margin and would make the necessary infrastructure investments too expensive to consider. The 35% discount to Brent tells us all that we need to know about that. But only if we are ready to shed our bias and stick to looking at the numbers.
No vangIV I'm NOT laughing at you or your comment...
Someone sent me this commentary very recently: Secession, State Banks And The Power Of The Purse
Its kind of a moonbat like commentary...
Some of the commentary, which was directed against the Fed, was pretty much on the money. But I do not see how state control over banking will lead to a better outcome than free banking in the absence of government control. If we look at the big busts in the 19th century we find that most were caused by political meddling with lending. A free society would avoid such interference and would make depositors, lenders, and borrowers responsible for the choices that they make.
"But I do not see how state control over banking will lead to a better outcome than free banking in the absence of government control. If we look at the big busts in the 19th century we find that most were caused by political meddling with lending"...
Well the potential for better banking 'might' be there because of the smaller number of banks to consider but then again I pretty much am thinking like you do about it and if history is anything to consider your comment about 19th century is on target...
The higher education boom coincides with the economic boom:
North Dakota economy booms, population soars
3/17/2011
North Dakota, the state with the nation's lowest unemployment rate (3.8%), capped a decade of economic prosperity with dramatic population growth in its biggest cities.
Fargo has seen steady growth over the decade..."Above 100,000? Wow. That puts us into a different category of city. That's great," says Fargo Mayor Dennis Walaker. The city is now home to about one of every six North Dakota residents.
The state's per capita income rose over the decade from 38th in the nation to 17th, the biggest advance of any state.
The oil windfall has created a $1 billion state budget surplus.
Agriculture — 90% of the state's area is used for farms and ranches — is productive and profitable, making the state a top exporter of wheat and other crops.
The state's weather makes it hard to lure new residents. The average January low temperature is four degrees below zero.
juandos,
"Secession, State Banks And The Power Of The Purse"
Ya, I'm LMAO too. That's a good one.
I especially love the opening quote:
"...blah, blah, blah. "It’s time to put our money to work for Oregonians.” — Bill Bradbury, former Oregon Senate President and Secretary of State, quoted in The Nation."
Translation:
"I'm running for re-election, and I expect you dummies will respond to that meaningless emotional appeal, as you're too stupid to know any better.
Maybe they're just going to school there to escape global warming.
Benji,
"I seriously doubt the Tea Party will ever mention this noxious bank,"
I guess I have to once again point out that until 2010 elections, the ND Congressional delegation was entirely Democrat for several years. Democrat Kent Conrad even scored a special student loan provision for this bank as part of Obamacare.
So naturally, Benji attacks the Tea Party. Do you enjoy looking like a moron, Benji?
Paul-
Tell me why is it we can't hear enough bad things about the GM bailout, but the annual bailout of farmers is never a topic in Tea Party circles?
And yes, rural D-Party nitwits are probably just as bad.
Benji,
I can assure you as a Tea Party member that negative aspects of Big Ag subsidies come up far more often among us than with the Big Ag whore of a socialist boyfriend you voted for. Today he promised to veto the "Cut, cap, and Balance" bill, is there a way you can blame the Tea Party for that, too?
Tell me why is it we can't hear enough bad things about the GM bailout, but the annual bailout of farmers is never a topic in Tea Party circles?
While I do not travel in American Tea Party circles I have seen plenty from the libertarian (as opposed to the social-conservative/Republican side) make a lot of noise about subsidies to everyone.
Michael Hoff
"Maybe they're just going to school there to escape global warming."
Holy cow! How long do they plan to be in school?
So it is obvious to me that those out-of-state college kids are looking to get higher paying summer jobs in the western North Dakota oil patch.
""I'm running for re-election, and I expect you dummies will respond to that meaningless emotional appeal, as you're too stupid to know any better"...
Yeah Ron H I think you pretty much nailed it...
juandos,
But emotional appeals win elections. Should we really vote or not vote for a U.S. president based on his or her stand on abortion?
But emotional appeals win elections. Should we really vote or not vote for a U.S. president based on his or her stand on abortion?
Why not. Where a politician stands and the logic and coherence of his/her position is a good indicator of both the candidate's intellect and principles. The way I see it this issue should disqualify most of the Republican field and all of the possible Democrats, including Obama.
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