Sex Abuse Scandal Rocks Penn State

[Ruhskins]

Originally Posted by SmootSmack

Could the university actually fall apart though? I mean even before all this the state government was considering cutting subsidies to PSU, for economic reasons. If they cut subsidies, if the DOE gets involved and levies fines or whatever, if there are millions of dollars in civil suits, if the application rate drops significantly...could that effectively destroy the university. Not just the football team, but the whole university

I can tell you there are already advertisers who are demanding to have their ads pulled from any game involving Penn State.

I think it would take a lot for a university to fall apart. Also, I am sure the state economy would take a hit if that were to happen to PSU. State appropriations only count for about 8 to 9% of PSU's revenues.

Now, what will happen is that PSU's prestige will take a huge dive (and in higher ed that's big, hence USNWR rankings). PSU may get less applicants or less talented applicants and they will need to admit more students in order to get their tuition/fees revenues. At this point, the PA governor has already signed the budget, but next year during the budget cut debates they will find it hard to fight the budget cuts as they did this year.