| College
costs continue to go up | | |
| Forgive me, I'm oversimplifying
a bit. Colleges have a ton of operating costs. And a main driver behind the erection
of fancy recreational facilities is the demand for them -- by students and their
families.
Why so pricey?
Richard Vedder, author of "Going Broke by Degree: Why College
Costs Too Much" recently tackled this question in commentary
published in the Wall Street Journal.
"Universities have discovered
what airlines realized a generation ago -- and they increasingly
charge the maximum the customer will bear," he says, adding
that the scholarships that schools give "go not mainly to low-income
students, but to talented students prized by universities seeking
to improve ratings on the athletic field or in the U.S. News &
World Report rankings."
Vedder,
who teaches economics at Ohio University, cites some rather startling statistics
in his commentary: "Only about 21 cents of each new inflation-adjusted dollar
per student since 1976 actually went for 'instruction,'" he says. "Government
subsidies and private gifts given to support affordable undergraduate instruction
are often spent elsewhere."
Such as what? Administrative staff, student services,
the athletics department (of course) and research, among other things.
Meanwhile, a full professor at a public university typically spends
only five hours a week teaching class these days, Vedder says.
In
other words, the priorities at many colleges have changed. It's all about image.
Quality may be waning, but costs are going up nevertheless. The
dark side of financial aid
Meanwhile, the financial-aid picture has
also changed over the past couple of decades, moving from a system that mostly
provided need-based grants to one that mostly pushes student loans.
And some students are resistant to the idea of taking
on loans, particularly those who come from poor families, and they're
the ones that would most benefit from a college education.
On a new Web site, Project
on Student Debt, Pamela Burdman exposes the problem in her study,
"The
student debt dilemma: Debt aversion as a barrier to college access."
Her assessment: "A reluctance to borrow on the part of
some students and families on the one hand, and an information gap about the possible
benefits of student loans on the other, combine to cement the role of loans as
the 'shadow side' of financial aid."
Federal loans constitute 47 percent of the student-aid
pie, while grant aid from private, institutional, state and federal
sources constitutes 44 percent. The problem: Roughly half of grant
aid (that's money that doesn't have to be repaid) comes from colleges
and universities, which have increasingly been doling it out on
the basis of merit rather than need. The result of these trends
is a widening gap in both enrollment and graduation rates between
those on the low end of the income spectrum versus those on the
high end. In other words, the more-privileged kids tend to get their
bachelor's degrees.
Meanwhile, the poor kids don't even consider
student loans to be a form of financial aid. They're just a financial burden.
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