A glance at the obituary pages over the past month marked the departure of two people with very different views of higher education.

The first was Peter Drucker, the legendary management guru who warned that a high standard of public education was essential if countries want to remain competitive in the knowledge-based global economy.

The second was a more local figure, Julius Edelstein, a long-time leader of City University who in the mid-1960s moved to create open admissions, a well-intentioned idea that nonetheless led directly to the university’s fall from excellence to near incompetence over the next 30 years.

These two lives remind us that ideas have real world impact – and not always for the best. Intentions need to be judged alongside outcomes.

Experts like Mr. Drucker and Mr. Edelstein can sometimes offer insight into what’s holding an institution back, but they can just as easily drag it down. If one asked a group of experts to devise the worst possible system for funding higher education in New York, they might come up with something like this: when the economy is thriving, government coffers are full, and families are getting by without too much pain, state funded colleges would proceed with the status quo. But when times get tough and government plunges into deficit – as New York often does – with families just scraping by, that would be the time to impose dramatic tuition hikes. That is precisely what we have in place today.

The restoration of CUNY from riots to again being considered “the poor man’s Harvard” is now almost a decade old. I occasionally teach a course at Hunter College. CUNY students today are Rhodes Scholars and winners of the Intel national science competition. But there have been bumps in the road to this success, and the last four tuition increases have averaged more than 31%.

That is why November 17, the current CUNY chancellor, Matthew Goldstein, gave a speech in which he unveiled a “New Compact for Public Higher Education.” Quoting a former president of the University of Michigan, Mr. Goldstein said, “We used to be state-supported, then state assisted, and now we are state-located … we are in danger of being state molested.”

He was colorfully referring to the fact that state funding for higher education has stalled at the same time that student’s costs have skyrocketed. The state funds that do come in are immediately absorbed by operating costs – labor, fuel, and fringe benefits. Too little of the state funding actually makes it to the classroom. Each year, CUNY administrators go through the bureaucratic dance of compiling a mandated four-year Master Plan, which is promptly ignored by the forces in Albany. This means that the university is always playing catch-up, and ambitious efforts to increase the university’s competitiveness, such as a $1 billion capital plan to improve science programs over the next decade, are in danger of being left by the wayside.

In the past, administration “solutions” would amount to an extension of the “tin cup” approach, begging Albany to solve the problem by giving them more money. But an all-state answer does not reflect the lessons of our recent history. What is needed in New York is a sustainable public-private sector solution, recognizing that we are a stakeholder society and that a stakeholder formulation is needed to improve the quality of higher education over the long-term. CUNY is seeking to codify this principle in its new proposal to lock in commitments from alumni, students, institutions and the state to fund a fair share of its Master Plan.

CUNY has produced more Nobel Prize winners than any other university, and with its return to respectability, grateful alumnae have proven willing to support it through donations. Earlier this year, Intel founder Andrew Grove gave an unprecedented $26 million to City College. While the presence of students’ tuition was once considered controversial, now frustration is primarily directed at the sudden and unexpected spikes in tuition. The new CUNY compact would build in an annual tuition increase of roughly $100, less than the rate of inflation. In addition to securing ear-marked Master Plan money from the state, CUNY would commit to further institutional reform – adding to the already estimated $25 million has been saved through cost-cutting measures. One colorful example of this is in the form of a dog named “Bud,” who, at the College of Staten Island, replaced $80,000 in annual expenses for chemicals that were being used to keep geese off the campus lawn.

Yesterday, the CUNY Board of Trustee voted unanimously to support the compact. Its fate now lies in the hands of the governor, his budget staff, and the State Legislature. While politicians are quick to spout pieties about the importance of higher education, there is often an ironic allergy to new ideas when it comes to funding the broken system. A few years ago there were vicious fights about the raising of standards at CUNY. Reformers were accused of racism and worse. Now there is acknowledgement that institutions must remain competitive to succeed. This new compact may also meet instinctive political resistance, but it is a wise step toward ensuring that CUNY will continue to be a credible way to access the American Dream.