Nearly all American universities have experienced tremendous growth in administrative staff in the last 30 years. At most schools the ratio of admins to faculty has doubled. As this trend continues necessarily tuition prices continue to outpace inflation. Within our lifetimes it is likely that the cost of a college degree will exceed the cost of a twin-engine business jet airplane (in the 1950s four years of tuition cost about the same as a new Chevrolet).
If colleges cannot get by without adding more labor per student why not do as for-profit corporations do and add that labor in China or India? As noted in a December 1, 2003 entry, MIT has had great success outsourcing OpenCourseware programming and editing to India. Think about all the jobs at a typical university that are done primarily via phone and email. Obviously the entire IT department could be in India. Why not the registrar? How about most of the coordinating and tracking functions of the alumni office?
American labor is wonderful but it is a luxury that most American families can't afford.
Business idea for the young readers: Start a university ”back-office” service bureau in India or China. The folks who've done this for Wall Street have been very successful (New Yorker magazine did a great article this summer on Office Tiger, started by two Princeton alums). Most university administrations lack the initiative to manage staff overseas (or do anything innovative, actually) but they would all appreciate the potential cost savings. So they'll need a contractor to do it all for them.
while i can see something like universitas 21 doing this, i doubt most universities would have any interest in putting more than the menial tasks into this sort of thing. there is just too much that actually goes on with these people. things that are not discussed nor made public, they form a critical mass that stabilizes things and provides for interesting opportunities in non-obvious ways.