Skip to comments.Making College Affordable
Posted on 05/16/2014 6:10:58 AM PDT by Kaslin
There's a debate among economists about why a college degree is worth so much. That the credential is valuable is not in doubt. According to the Pew Research Center, college graduates earn about $17,500 more annually than high school grads. Why?
The "human capital" school believes that students learn valuable skills in college that employers are willing to pay for. The "signaling" school doubts that the content of a college education is really that marketable. They argue that employers are interested in the traits -- diligence, intelligence, self-control -- that a degree reflects.
For decades, politicians have bought votes with promises to make college "more affordable." They passed legislation with names like the "College Cost
Reduction and Access Act" and the "Ensuring Continued Access to Student Loans Act." There are Pell Grants and Stafford Loans, and much more besides.
Shockingly, colleges and universities have increased their prices more than any other sector of the economy except health care, which is also -- surprise! -- highly subsidized. As Anya Kamenetz writes in "$1 Trillion and Rising," a report for Third Way: "Since 1978, the cost of college tuition has increased faster than the consumer price index in every single year. That's not true for any other item in the basket of consumer goods."
Student loan debt now exceeds all other consumer debt except mortgages. Default rates have reached a 20-year high, with as many as one in six borrowers failing to repay his or her loans. Taxpayers pick up the tab. Just since 2007, the average debt has increased by 43 percent to $26,000. The overhang of student debt is slowing the economy, some argue, as debtors put off purchases of cars, homes and other goods in order to service student loans. For the 30 percent of debtors who don't graduate, the added debt carries no offsetting reward in higher wages.
What have colleges been spending all of that extra money on? Between 2001 and 2011, according to The Wall Street Journal, the number of college and university administrators grew 50 percent faster than the number of instructors. Presidents of public research universities earned a median income of $441,392 in 2012.
Facilities at many colleges have become country-club lavish, with hot tubs, climbing walls, lazy rivers, movie theaters, sushi bars and single rooms with attached bathrooms. Universities across the country have been on a building spree. Dubbed the "edifice complex" by Richard K. Vedder, who studies college spending, much of it has been financed by debt.
Though both Republicans and Democrats have participated in the political pandering that created the higher-education bubble, Democrats have less room to maneuver in seeking reform. As with K-12 education, the universities that profit from current arrangements are the Democratic Party's constituents. President Barack Obama's approach has been to forgive outright the debt of students who work for the government, thereby increasing the burden on taxpayers (most of whom did not attend college).
The sky-high cost of college is a worry for many middle-class families. (Have you seen the financial advisers' ads targeting parents of newborns?) Republicans are likely to have the reform field to themselves for a while.
Mitch Daniels, who taught the Republican Party valuable lessons in management as a successful and highly popular two-term governor of Indiana, is now doing the same for academia as president of Purdue University.
For the third year in a row, Purdue has frozen tuition rates. President Daniels (I know, it has a nice ring to it, but let that go) explained how he did it. As USA Today explained, "There was no secret sauce, just a little sensible pruning that would be ordinary in the business world but seems alien in much of academia, where a steady flow of federal aid guarantees a steady flow of students at seemingly any price." Purdue consolidated some of its administrative positions. It chose a higher-deductible health care plan. It cut food service costs by switching providers and hiring part-time students to do work formerly performed by full-time employees. It short, it acted as if cared about consumer, i.e., student satisfaction.
Republican governors of Texas, Wisconsin and Florida have called for $10,000 degrees at their public universities. Not $10,000 per year, but $10,000 total, which would return college, inflation-adjusted, to what it cost in the 1970s.
Kamenetz urges that a combination of online courses, fewer nonacademic perks, cutting administrative bloat and focusing on graduation, not just enrollment rates, would make college what it should be -- a boon for the poor and middle class. The current system, which burdens taxpayers, graduates and -- most painfully -- dropouts, with massive debt is uneconomic, unjust and unsustainable.
One possible solution - a PC based or Web based “core” that would allow the users to load instruction modules that would provide instruction. This would be seperate from a centralized testing authority like the testing organizations used by technical companies (Microsoft and Linux certifications, etc).
Many technical, hard arts (math), science and engineering degrees could be completed via this train then test model.
That it’s still legal for a college professor to write a textbook, slap a $150 if not more price on it and then require his students to buy is nothing short of amazing. Plus the little trick of making a few changes to it each semester, thus making the older “version” unusable.
My husband STARTED college at 29 years old. He had to work full time to support himself and still had to borrow.
We married when he was 34 years old. A few days after our wedding he handed me a "coupon book"--his payments for his education. The book started at NUMBER ONE. I asked his: "Couldn't you have paid ONE payment?" :o)
Nothing new in school loans.
I had parents who paid my tuition. They couldn't afford it. I didn't ask how they did it because they SO wanted me to get the college education.
BUT I had to do it in FOUR years.
I did it in four years, worked summers and Christmases for the things I wanted and that they couldn't afford, and have never looked back. They even let me keep all the money I made at work. God bless them.
IMHO both are correct. For scientific fields, the degree demonstrates valuable skills. For fields such as business, marketing, or management, the degree demonstrates that the prospective candidate stuck it out for four years to get a degree, any degree.
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One minor thing the pupils can do is stop buying the textbooks. Tests come from lecture material only in 90 percent of the cases, but colleges “require” textbook purchases. Only the uninformed pay so much. Of course, that wouldn’t affect the overall financing of college that much.
indeed! this made me smile :)
I look back and am so grateful for their sacrifices and generosity. I was truly blessed.
True, college does need to be more affordable, but based on what I’m seeing regarding the total leftist domination of the course material, I think they ought to focus on making it worth going at all.
Barack Obama is an advertisement for how you can go to Harvard and still come out a complete ignoramus and commie-indoctrinated moron. And now they’re putting “White Privilege” into the orientation program — which is about as disgustingly racist as anything I can imagine.
I really don’t think that a modern liberal arts (i.e. progressive arts) college education is worth the investment of time — at any price.
Scanning the FR posts, my brain read this as, “Making Coffee Affordable.”
I guess I need to splurge and have another cup or two.
On the subject of the actual headline: college is a scam, and a shame (and I’m someone who had lots of it back in the day).
The money the author/professor gets from that $150 textbook is very very small. The publishing company doesn’t have to pay to write the book but charges a high price to print and market the book. The publisher is probably located in a high cost city like NYC. However, the used book market and online course materials lower the sales revenue.
I once worked for a professor who wrote a great textbook. The first year or so, he made a few hundred dollars in royalty payments, which he gave to the students in his class (yes, he gave that money away). After that, he made less than lunch money. It took a lot of time and research to write the book. There are very few authors who make much money on textbook sales.
The frequent revised/new versions of textbooks are scheduled by the publisher to, for one reason, reduce used book sales which generate zero sales revenue for the publisher.
There is vastly more money to be made in consulting and research.
Not to criticize your comment about expensive textbooks—they are horribly costly considering what you get. It is just that the professor/author doesn’t make much money and does it for other reasons.
“The frequent revised/new versions of textbooks are scheduled by the publisher to, for one reason, reduce used book sales which generate zero sales revenue for the publisher.”
This frequent claim is based on a misunderstanding of the market for used, durable goods. The initial price of a new textbook reflects its value in use throughout the textbook's life cycle. Think how much less you would be willing to pay for a car if it were pre-programmed to stop working after three years, or how much less you would be willing to pay for a house if its resale were banned. When a student pays $150 for a new textbook, she does so in the expectation that she will be able to recoup about half that amount by re-selling it. So, the used book market essentially serves an an informal rental market. Interestingly, many college bookstores are formalizing this by inviting students to rent, rather than buy, new textbooks at (typically) half price or less.
I think the “signalling” school is going to lose the argument.
It is scandalous how easy it is to graduate with “some degree, any degree”. If you have money and a pulse you can get a degree and employers know it.
I think Conservatives need to approach the subject, like the left does. Big Education needs to be reigned in. Big education only cares about profit. Big Education hurts the students (consumers). Big Education has a pay gap. The meme could go on and on.
When I was searching for jobs in the past, often one of the requirements was a minimum education of a BA in any subject. It was a way for HR departments to weed out a bunch of probably otherwise highly qualified candidates, just so HR didn't have to sift through 10,000 resumes for one job.
Maybe the answer is to make it possible once again for a HS graduate to have the n life and job skills needed to earn a living and be independent.
I agree completely, and what is wrong with learning a skill?
“...and what is wrong with learning a skill?” Nothing as far as I am concerned.
In my opinion current HS education is designed to keep young men and women in a state of perpetual adolescence.
High school is about sports and clubs. If some kind of learning happens along the way, it’s a bonus. It’s real purpose is obedience training and a jobs program for over educated bureaucrats. High school is a little artificial society that teenagers are forced to center their lives around. If it was really about getting kids ready for life you would be able to skip it if you can pass a proficiency test.