State policy capacity should be focused on the linkages between higher education and society, and not on the details of institutional management. The new policy environment will require organizations with credibility and leadership skills that can link higher education to the future of each state and the nation as a whole, build relationships between higher education and policy leaders, work across education sectors—with schools and colleges, with public and private education—and with agencies responsible for other dimensions of social and economic policy. In some states, this change will be one of emphasis, but in most it may require a different design for state policy than they have had before.
The purpose of the changes needed is clear: America must substantially increase its levels of educational attainment for its people—its priceless educational capital. We first state the reasons for this ambitious goal and then the unique responsibilities of states for achieving it. In the third section we list a number of principles or criteria by which we believe actions should be judged, and which raise questions for states.