An edited transcript of a televised American Enterprise Institute Public Policy Forum examines the dangers and benefits of the relationship between government and academia. The following questions about the government's increasing role in higher education are discussed by the panel: Can state and federal governments assist colleges and universities without overburdening them with regulatory red-tape and without endangering academic freedom? How much independence from societal control can colleges and universities claim, and on what grounds? Does government endanger academic freedom when it sets rules for faculty hiring and promotion, for student admissions, and for the prohibition of certain types of research? Panel members are Robert A. Goldwin, Stephen Graubard, David Mathews, and Robert Wood. John Charles Daly serves as the panel moderator. (SW)