The greatest American victory of the post-1945 era was the victory of American universities. Before the Second World War American universities were mediocre in comparison to their international peers. Take two representative fields of research – atomic physics and political theory. For scholars and students of these fields in the 1930s, universities in Germany, England, France, and other countries had more to offer than their American counterparts. By the 1950s, however, almost no one in these fields would say the same. The United States became a dominant site for research and teaching in physics, political theory, and almost every other field.

The Second World War rocketed American universities ahead of all peers for two simple reasons. First, the immolation of Europe and Asia forced many of the best minds on these continents to flee to the United States. America offered one of the few sites of partial refuge from the storms of hatred, violence, and deprivation. Second, thanks to the war economy, and its postwar reverberations, the United States had more money – much more – to invest in higher education than anyone else. For the fifty years after the Pearl Harbor attack, Americans devoted more capital – public and private – to their universities than their counterparts in any other country. The global knowledge investment gap exceeded even the military investment gap.

After the Second World War American universities became wealthier, larger, and more numerous than anyone could have imagined before. They easily attracted the best faculty and student talent from around the world. They produced more research, graduated more students, and added more value to their society than their foreign peers because they had more of everything. American universities were not most effecient or most strategic; they were, simply, the most capitalized.

In the last decade things have changed drastically. American universities remain wealthy institutions with growing demand for their research and teaching. They remain the respected sources of accreditation for talent and achievement. That said, they no longer are immune to the slowdown in American economic growth. Regardless of how the United States emerges from the recent recession – the most profound economic decline since the Depression – public and private investments in universities will never return to their post-1945 levels. The United States will not have available resources for that previous level of investment, or anything near it, for the foreseeable future.

University leaders, professors, students, and parents need to stop denying this obvious fact. They need to spend less time focusing on short-term efforts to close budget shortfalls that will not go away, and turn their attention to major structural reforms that preserve quality and value in vastly different economic circumstances. To put it another way, universities need to make the hard choices they could avoid in the recent past, when the economics of growth meant they could try to do everything.

Other parts of American society have adjusted – or tried to adjust – in recent years. Those that continued to rely on growth and avoid reforms failed miserably. The American automotive industry is a case in point. Inefficiencies, excess, uneven quality, and poor management allowed once tiny foreign competitors to eat Detroit’s lunch. Why should American universities be immune from the same dynamic? The Economist Magazine asks this jarring question in its September 4 issue: “Will American universities go the way of its car companies?”

There are no easy answers to what American universities should do next, but everyone should agree that they cannot continue to do more of the same. Here are 3 areas of much-needed reform, areas where universities have stubbornly clung to old models despite all the changes around them. Universities should preserve inherited wisdom, but they must think more creatively about adaptation and adjustment…or they will join the Detroit junk heaps:

1. Teaching: Enter a college lecture hall or seminar room today. With the addition of a little new technology, these spaces look as they did 25 years ago. (In many cases, they are exactly the same places, without much renovation, from 25 years ago!) The fundamental assumption remains that education revolves around a given group of students arriving in the same place at the same time to learn from a professor at the front of the room. Is that really the best model for education today? Aren’t there alternatives that might improve quality, access, and reduce cost? Shouldn’t universities do more to experiment with alternatives?

2. Specialization: Anyone who has spent even a little time at an American university knows that scholars do not talk very much to one another about their research. When scholars on the same campus confer, it is usually about administrative matters, discussed in endless committee meetings designed to make everyone feel special. Each professor is the master of his or her own defined specialization. Departments organize curricula around specializations, guarding their own disciplinary prerogatives. For all the talk of interdisciplinarity, the incentives of the American university are in separation, specialization, and uniqueness. Shouldn’t universities do more to emphasize substantive collaboration in research and teaching? Shouldn’t they re-think the structures of authority and the appropriate roles for departments? Shouldn’t universities contemplate new organizational models for research, teaching, and administration?

3. Public mission: American universities generally rely on a very self-centered justification for their mission. They claim they are great and that, by virtue of their greatness, they make everyone who comes through – student and researcher – great as well. Despite all the economic difficulties of recent years, university leaders ask governments, tuition payers, and donors to give ever greater amounts of money to support this asserted greatness. I find this pathetic. Universities need to define and serve a public mission that is much more tangible. In a time when so many Americans are contemplating the things they must now give up, universities must offer a better defense for their value. They need to jettison the empty rhetoric about unfettered inquiry (an unpersuasive myth), and articulate clear ways in which universities will work to improve the world around them. Citizens, faculty, students, and governments must then hold universities accountable to these claims. In a world of constrained resources, there will be no sacred cows. Academics better get used to that.

The future of American universities, like the future of all legacy institutions, is quite uncertain. Universities have been a very privileged part of America’s recent history, and it is painful for them to adjust to a more demanding environment. After the Second World War prosperity made American universities great, and they furthered that prosperity. Now, in less prosperous times, the challenge is to be better, not bigger. The future of American universities will turn on how well they adjust, experiment, and reform. Victory will not come from following the tried and true tactics.

The opinions expressed in this blog are personal and do not necessarily reflect the views of either Global Brief or the Glendon School of Public and International Affairs.