Today is my three-week anniversary as Chancellor.   Actually, my first day on the job was the USC football game, and we’ve had a pretty good run since then.   In that same three weeks, we announced our latest Nobel Prize and a new MacArthur “Genius” award.   Please don’t hold me to this standard for the next three weeks!

Of course, I had as much to do with all of that as I did the discovery of oil in the Permian Basin, but it’s a great early reminder of why I left a pretty comfortable existence in New York to join the UT System. 

What’s going on in Houston, one of the System’s most important hometowns, is a key reason I wanted to be a part of this.  Even in New York, everyone recognizes – although some are loathe to admit – that this is one of the most vibrant, diverse and dynamic cities anywhere, with a well-earned reputation for innovation in everything from aerospace, energy, engineering, entrepreneurship, and of course, medicine.   A city with a synergistic relationship with higher education, health care and research – what we do so well across the UT System.  

Before I say a bit more about the University’s deep ties with Houston, I want to start at 10,000 feet.  I know many of you know the UT System well, but I have found in my short time in the state that our scale and reach are not well known to enough Texans.   That’s unfortunate, because the UT System’s continued growth and success is key to the future of Texas. 

Yes, there is a world class academic institution in Austin – that is now winning a lot of football games, too – but the UT System is that and much more:  235,000 students across the state in 14 institutions; 8 comprehensive academic institutions and 6 top health science centers. 

At $2.9 billion annually, the UT System is 2nd only to the University of California System in total research dollars – and I like our chances in the future.   Research fuels innovation and productivity, and last year our institutions received the 3rd highest number of patents of any system in the country.   And, we recently ranked 9th in Reuters’ ranking of the most innovative universities in the world.

But the most important “technology transfer” of any university is the achievements of its graduates who leave with a first rate education, and the UT System is an engine of economic mobility like few others.   Our graduates – 59,000 last year alone – are the workforce, the entrepreneurs, the doctors and teachers of Texas in the 21st century.  

A full 45% of the degrees we award are in STEM fields – far surpassing the national rate of 34%.   A healthy number of those degrees are from UT Austin’s Hildebrand Department of Petroleum and Geosystems Engineering – the top ranked petroleum engineering program in the country.

Let’s talk a bit more locally.  The UT System and this region have been successful partners for a long time.  Well over a century.  UT Medical Branch in Galveston got started way back in 1891, as one of the two original campuses of the University of Texas, and as the country’s first combined public medical school and hospital. 

The System’s presence in Houston proper began in 1942, when the MD Anderson Hospital of Cancer and Research became the first member institution of what is now the 56-member Texas Medical Center. 

Thirty years later came the University of Texas Health Science Center at Houston – better known as UT Health.

As the years passed, our three institutions became enmeshed in the life of this community and region.  We are the city’s second largest employer. The largest concentration of UT institutions’ alumni lives here.  We receive more student applications from Houston than anywhere else.  And we do very well from generous philanthropists in Houston. 

The professionals at MD Anderson, UT Health, and UTMB provide the people of the city and region with a level of care few places in the world can match.  They’re training the next generation of medical leaders, many of whom will stay right here and continue to serve this community for decades to come.  And they are conducting cutting edge research that takes on the toughest, most deadly diseases.  

Everyone in this room knows that MD Anderson is widely regarded as the best cancer hospital in the world, a point of great pride for Houston and the UT System.  But more important is the impact it’s having on the lives of so many people in Texas and beyond.

I don’t mind admitting that it’s a little humbling – and more than a little inspiring – to join the UT System, where genius – and I don’t use that term lightly – absolutely abounds.

Case in point, I know you’re aware that just last week, MD Anderson’s own Dr. Jim Allison won the Nobel Prize in Medicine for his groundbreaking work on a new way of attacking cancer, by treating the immune system rather than the tumor.  Not only is Jim doing his transformational work at MD Anderson, he received his academic training at another of our institutions—UT Austin.  Bragging rights all around. 

And my new colleagues at UT Health are likewise making a huge difference.  UT Health is the most comprehensive academic health center in the UT System, and the entire Gulf Coast region.  I want to acknowledge UT Health’s president, Dr. Giuseppe Colasurdo, who is with us tonight.  Giuseppe is providing world class leadership for a world class institution.

One of the many areas where UT Health scientists and physicians are breaking important ground is in stem cell research.  In partnership with Memorial Hermann-Texas Medical Center, UT Health was the first in the country to intravenously inject a stroke patient’s own stem cells.  And they have launched the first-ever clinical trial investigating a stem cell therapy for early treatment and prevention of complications after severe traumatic brain injury.

50 miles or so down the road in Galveston, UT Medical Brach is another of the UT System’s crown jewels – with a rich history of caring for its island community and providing national service.  

Galveston National Laboratory is one of only two National Laboratories with Biosafety Level 4 capabilities located on a university campus in the United States.  In service to the country, and really the world, UTMB scientists are handling the deadliest pathogens imaginable and developing vaccines to protect us from some of the most deadly diseases known to man.

When you look at the Texas Medical Center – the largest medical complex in the world – the size and strength of our three local health science centers really stand out.  They may be only three of 56 member institutions, but together they account for roughly 37% of the total Medical Center employees and 40% of the patient encounters.  We are committed to the long-term success of TMC and its impact on Houston and the state.  

Together, UT Health, MD Anderson and UTMB conduct well over a billion dollars a year of life-saving research – nearly 40% or the UT System’s total research activity.

I’m looking forward to getting to know the area a lot better in the years to come – and I am grateful for the chance to be here with you in one of my early opportunities to talk a little bit about higher education generally, the System, and the service I see us providing to the people of this great state that’s clearly on the move.

I’ll start with what is at the core of my personal philosophy regarding education – and what has motivated me since I left Wall Street three decades ago to work in public higher education in North Carolina, Nebraska, and New York – preparing for Texas.  

I believe that talent is universal and is distributed equally across the population, regardless of economic status, race, ethnicity, national origin or zip code.  But opportunity – who gets the best preparation for college, who gets into the best colleges, who earns a degree, and who has access to a rewarding career path after college – is not equal, and is still stubbornly correlated with wealth.

The difference maker, the great engine of economic and social mobility in American society that helps turn talent into opportunity, is higher education.  And public higher education, which produces 70 percent of our nation’s graduates, is the most important engine.

I’m convinced there has never been a time in history when higher education was more important than it is today.  To have the most opportunity, to get the best jobs in a knowledge-based economy, education beyond high school is essential.  In fact, we are rapidly approaching the time when most jobs and ALL new jobs created require education beyond high school. 

When a student graduates – particularly a first generation college-goer – it affects not just his or her life, but the lives of their family and community members for generations.

For society at large, more college graduates means a bigger, stronger, healthier, better workforce, more taxes paid, fewer social services consumed, citizens who are more engaged and give more to noble causes, and a better quality of life for everybody.  What’s not to like!?

These are facts, demonstrable and – you would think – non-controversial. 

And yet there has never been a time I can recall, when higher education has received as much criticism, or been under as much threat as it is does today.

The reasons are well known.

Across the country tuition that has, on average, risen rapidly. 

Not coincidentally, you see student debt levels which some time ago shot above $1 trillion.

You see colleges that aren’t graduating their students quickly enough.

And you see graduates who are unable to get jobs in their field of study. 

So what we – and by we, I mean everybody in higher education – need to do is whatever it takes to demonstrate that we are serving the people in a way that is once again broadly recognized as being of tremendous value.   I’m not saying we need to tell our story better, I’m saying we need to do our job better.  

Not just because it’s important to our success, but because it’s critical to America’s success.

A generation ago, we took it for granted that the United States was number one in the world when it came to educational attainment. We had the highest percentage of our people with a college degree.  That’s no longer the case.  Now we’re not in the top 15!

The rest of the world figured out that the countries with the highest levels of educational attainment are going to have the most dynamic economies, the most successful businesses, the most ground-breaking research driving innovation, the best health, and on and on.

Hungry for what we have, they are out-competing and – it’s important to note – out-investing us.

Nationally, state support for higher education as a share of total cost has been on the decline since the late 1980s.  As states have spent relatively less, students have had to pay more, and borrow more.  And many would-be scholars were priced out of the education that could have reaped so many benefits for them, for their families, for the economy and for society.

This is a problem for everybody – and for business leaders in particular.

The Georgetown Center on Education and the Workforce – the best place doing this kind of work – estimates that by the end of this decade, 51 million new jobs will be created, and more than 70% of those will require a college-level degree or certificate.

Unfortunately, census figures tell us that fewer than 40% of Americans hold at least an associate’s degree.  That compares to more than 60% in Canada and South Korea.

If we want our businesses, and our overall economy to compete and win in the global knowledge economy, we have to close the gap between our current level of educational attainment and our future needs.

There can be no doubt that we need to produce a lot more college graduates in this country.  Millions more!

And here’s the good news, for everyone in this room, and everyone in the state – which, by the way, helps explain why I am so bullish on the future, and excited about this job I’ve spent 30 years preparing for.

Of the 50 states, Texas’s population is the second biggest and the third youngest.  So we will naturally have more students in the pipeline, and the potential of having one of the best-educated workforces anywhere.  

But we’re going to have to grow.   I don’t know if we’re the right size for Texas today – I’m pretty sure we’re not.   But we’re absolutely not the right size and scope for Texas in the decades to come.  

We have a long way to go.

Today, just three in ten Texans between the ages of 25 and 34 have earned a Bachelor’s degree or higher.  That places us 35th in the country.  I may have only lived in Texas for three weeks, but I’m pretty sure that Texans don’t like to rank 35th out of 50 in anything good.  

That’s part of what I love about Texas.  The competitiveness and ambition and confidence.   I also like big, Texas-sized goals.  And that’s exactly what the Texas Higher Education Coordinating Board has set with their 60x30 initiative, aimed at making sure 60% of Texans aged 25 to 34 have a certificate or degree by 2030.

That goal speaks to the potential, and the sense of confidence and optimism that are embedded in the DNA of both Texas and the UT System.

The way we achieve that ambitious goal is pretty simple to say, but much harder to do. 

If you want more college graduates you have to do two things.  First, create more and better pathways for students to get to college – that is, increase access.  And second, give students the tools and support they need to get out of college with a degree, as quickly as they can – increase graduation rates.  

Both of these require commitment and investment.   But it’s an investment that has always paid off for this country and will do so even more in the future.   And while it is essential that we produce more well-educated Texans, that isn’t all we need to do.  

We must also continue to invest in research and graduate and medical education at the highest levels.  Places like MD Anderson change the lives of so many people, but it doesn’t happen without sustained investment and recruiting and keeping great talent.   The same can be said about our academic institutions.  I’ve heard much in the last few months about moving our universities up in the rankings, and building more top research universities in places like Dallas, San Antonio and El Paso.  I’ve heard that we want all our institutions to be higher in the national rankings.  

And one thing that is tremendously gratifying is that I have heard this not only from the Regents, who you might expect to share this bias, but also repeatedly from Governor Abbott.   Let me tell you, we are fortunate to have a governor who gets the importance of having world class universities, more college graduates, and leading research enterprises. 

Our goals for the UT System are big, but I believe they are achievable – in fact, necessary.   To have a first rate higher education system that adequately serves the state, the UT System will have to grow along with the state, and our emerging research institutions will have to have emerged and be competing with the best.

Just to give you one statistic for comparison: Texas has two institutions among the top 30 public research universities in the country; in California, 6 of the 10 institutions in the UC System are among those 30.    We can and will do better. 

The people of UT Health, MD Anderson, UTMB and all the institutions of the UT System have ambitious plans to serve the people of Texas and lead the world.  But we can’t do them alone.

One thing I’ve learned in my thirty years in public higher education is that big things are possible only when there is alignment of the institutions, political leadership, business leadership, community leadership.  And donors.  

So rest assured, as I set out on this journey, here at the beginning of my fourth week, I want to hear from you, about your needs, your ambitions, your concerns.  And with the legislative session rapidly approaching, we would welcome any and all support you can provide as well.

Thanks again, to Steve Newton and his colleagues at Russell Reynolds for inviting me, and to all of you for being a great audience.  I’d be happy to respond to any questions my three weeks in Texas has prepared me for. 

Thank you very much.