01/22/2013 12:10 pm ET Updated Mar 24, 2013

Pay as You Go

In this day and age, those entrusted with running colleges and universities would be well served by fiscal conservatism. The conservative approach I used with respect to construction projects (I refused to bond anything until the funds were pledged or an income stream found) was representative of my approach to running a college. However, my fiscal conservatism was not the limiting principle that most would expect.

If I were to label myself, I would say I am an "educational entrepreneur." Normally, an entrepreneur is willing to take risks. I was always willing to take risks, just not financial risks.

Perhaps it was that I liked asking for money; perhaps I simply liked sleeping well at night. In any case, I never took on a project without knowing how I could pay for it, and paying for it generally meant going out and raising the money.

Raising money came naturally to me. I viewed it as a form of negotiation, and negotiation for me was what I most liked to do professionally. As I not-so-jokingly said, a college or university president is someone who lives in a big house and begs -- and I happily did a lot of begging.

An example involved my decision to tackle a problem that had long been talked about in college circles. College presidents had sought for years to deepen the pool of qualified at-risk applicants to their campuses. Working with high schools, they -- and I -- had largely failed because we got to the children too late.

I decided to try to do something about the problem. Turning to a charismatic faculty member who had taught in inner-city schools in Chicago and Oakland, I challenged him to come up with a program, and I said I would raise the requisite funds. He did, and I did.

We established an academy for grade-school children on our campus. Over the years, several hundred disadvantaged children benefited from their participation in the academy (they still do). So, of course, did the college. Importantly, though, this effort put no pressure on the college's budget because the funds raised were put into an endowment and the draw each year covered the expenses incurred. (By the way, I believed so strongly in the program that, upon leaving my second presidency, I created a foundation to take the program national.)

College and university presidents should always, in my view, pay as they go. Remember, they always will pay. The question is only whether they will pay through the hard work of fundraising or, alternatively, through sleepless nights worrying about the debt they incurred on behalf of the institution they weakened.