Washington

NO matter what the University of Virginia’s governing board decides today, when it is scheduled to determine the fate of the university’s ousted president, Teresa A. Sullivan, the intense interest in the case shows how much anxiety surrounds the future of higher education — especially the question of whether university leaders are moving too slowly to position their schools for a rapidly changing world (as some of Ms. Sullivan’s critics have suggested of her).

There is good reason for the anxiety. Setting aside the specifics of the Virginia drama, university leaders desperately need to transform how colleges do business. Higher education must make up for the mistakes it made in what I call the industry’s “lost decade,” from 1999 to 2009. Those years saw a surge in students pursuing higher education, driven partly by the colleges, which advertised heavily and created enticing new academic programs, services and fancy facilities.

The almost insatiable demand for a college credential meant that schools could raise their prices and families would go to almost any end, including taking on huge amounts of debt, to pay the bill. In 2003, only two colleges charged more than $40,000 a year for tuition, fees, and room and board; by 2009, 224 were above that mark. The total amount of outstanding student loan debt is now more than $1 trillion.

Students were not the only ones to go deeper into debt. So did schools, building lavish residence halls, recreational facilities and other amenities that contributed little to actual learning. The debt taken on by colleges has risen 88 percent since 2001, to $307 billion.