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Mitch Daniels, a Potential GOP Front-Runner, Won’t Run

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A Republican who easily could leap to the front of his party’s gaggle of presidential contenders won’t do it, because he’s already a president—of Purdue University. Mitch Daniels is doing to that university what he did to Indiana when he was its governor: cutting costs and improving services. He has kept tuition flat, decreased the cost of room and board by 10%, and is trying to raise graduation rates, even as he expands admissions and, consequently, boosts revenue.

“We want to be known for the number of students we successfully send out, and not for the number we shut out,” he says, taking a shot at magazine rankings of universities that equate a low acceptance rate with academic superiority.

Daniels, a former pharmaceutical company executive, the former director of the president’s Office of Management and Budget, and one of the most effective governors in the history of Indiana, is a perennial favorite of the GOP’s rank and file. He has a knack for improving the performance of complex organizations run by seemingly intractable bureaucracies. Fortune this year placed him at No. 41 on its World’s Greatest Leaders list, lauding his “green eyeshade” approach to governing.

Based on Daniels’ achievements at every place he has run, be it Eli Lilly’s North American pharmaceutical operations, the OMB during the George W. Bush administration, or Indiana, he has the makings of a fine U.S. president. But Daniels, who turned 66 last week, says he isn’t interested, despite persistent entreaties. Instead, he intends to concentrate on his five-year gig at Purdue, which began in January 2013.

DANIELS DID WEIGH a presidential run in 2008, but told me over lunch last month that he dropped the idea after realizing that, although he might win the nomination, he couldn’t beat then-Sen. Barack Obama of Illinois because voters no longer wanted a Republican in the White House.

Although Daniels has set politics aside—at least for now—he hasn’t abandoned his pursuit of the limelight. He has a public-relations mechanism in place to advertise his accomplishments at Purdue. These include making education more affordable for average families. In-state tuition runs about $10,000, with another $10,000 for room and board. Tuition for out-of-state residents is about $29,000. For international students, it’s about $31,000.

Before he took over, Purdue had raised tuition 36 years in a row, “and so had everyone else,” says Daniels, who was determined to break that cycle. “Everybody thinks that what you are selling is a necessity, so you have total pricing power. When you raise your price, you not only do not drive customers away, but people assume a higher price means higher quality.”

Daniels can’t keep tuition flat forever. His teaching staff, which has supported the effort, deserves salary increases. More paying students would make it easier to moderate tuition hikes. A tutoring program aimed at graduating all students in four—not five or six—years should make school more affordable. Purdue is increasing its student body, even if it means that the academic profiles of the entering students will flatten, reducing its ranking in those magazine lists. Applications are up 15%. And all categories of enrollments—in-state, out-of-state, and international—are climbing, Daniels says.

We could use a president who sees the world through green eyeshades. 

E-mail: jim.mctague@barrons.com