The Right Way to Cut College Costs

National Review ^ | 11/29/2018 | Brad Polumbo

[SeekAndFind]

Total student debt hit an astronomical $1.48 trillion this year. The average graduate now leaves school with $40,000 in loans hanging over his head.

So is it really a surprise that Senator Bernie Sanders (I., Vt.) won over millions of young people in 2016? After all, he campaigned on student-loan bailouts and “free college.” Many students desperate for an answer now support this agenda — in the hope of escaping crushing amounts in debt.

Yet government intervention is what created the higher-education bubble in the first place. One of the biggest factors behind skyrocketing tuition rates is the federal subsidization of student loans. Every dollar loaned out leads to an average 60-cent rise in tuition rates, as universities seize the opportunity to jack up prices in the face of heightened demand. That’s why the cost of public colleges has soared in recent years — it’s up 213 percent since 1988, adjusted for inflation. So any student who is serious about addressing the rising cost of college shouldn’t be looking to big government for relief, but rather to universities themselves.

Purdue University, for instance, is proof that colleges can be affordable — if they’re run as they should be.

Tuition hikes hit Purdue students hard between 2010 and 2012. But when former GOP governor Mitch Daniels took over as president in 2013, he implemented comprehensive reforms that slashed the cost of attendance. Daniels signaled his intentions from the onset, taking a salary $130,000 lower than that of his predecessor.

Daniels then took a hacksaw to the bloated bureaucracy on campus, cutting $8 million from the school’s operating budget. He also slashed the cost of room and board by 5 percent, trimmed the fat from the campus dining program to reduce prices by 10 percent, and struck a deal with Amazon that saved students 30 percent on textbooks. Yet Daniels didn’t just cut costs — he reduced classes, too. He introduced Purdue’s now-famous “Degree in 3” program, allowing liberal-arts students to graduate a year early and reducing the cost of college by 25 percent. This lets some students save as much as $20,000.

The result of these reforms? Under Daniels, Purdue has frozen tuition rates since 2013, students and their families have saved over $57 million, and student borrowing has drastically fallen. The total in-state cost of attendance is now just over $21,182 per year — an affordable amount compared with many other top public universities. And that figure doesn’t include financial aid or scholarships, so the bill many Purdue students actually pay is even lower.

Despite what critics predicted, Purdue’s reputation hasn’t suffered after the budget cuts. In fact, under Daniels’s leadership, the university has risen from 64th to 56th in the U.S. News & World Report rankings.

Although many Purdue students lean liberal, they’re having trouble denying the positive effects that fiscal conservatism is having on their campus — and their pocketbooks. When I talked with Bridgitte Buchanan, outreach director of the Purdue College Democrats, she told me she appreciated what Daniels has done to keep costs low for students, and she praised his Degree in 3 reform. Support for the university’s president is not partisan: Daniels is so popular on campus that students sometimes crowd around him at the dining halls and take pictures. It makes sense that conservatives would love him, but at least at Purdue, the Mitch Daniels model wins bipartisan support.

So in the face of an ever-expanding student-debt bubble, it’s time for this transformation to take place on the national level. Yet unfortunately, 77 percent of Millennials still support the “free college” proposals pushed by Democratic Socialists such as Senator Sanders. They ignore the alternative: reining in free-wheeling spending on campus and passing the savings on to students.

This is dismaying. Young people at colleges across the country are paying the price of administrative waste, bloated budgets, and frivolous expenditures. But they turn a blind eye to the solution, as do administrations across the nation. Students truly concerned about tuition rates and immense amounts of debt need to forget their infatuation with socialized higher education — and realize that fiscal conservatism is what will get us out of this mess.

[Dilbert San Diego]

So it sounds as if, there is no incentive on the part of colleges, to rein in costs. Reason being, they can raise tuition and fees at will, and receive little pushback, because students will simply end up borrowing more to cover the increases.

[PGR88]

Gov. Daniels taking a hatchet to Purdue’s administration costs is a top-down bureaucratic solution. It probably involved a huge fight with leftist admin and unions, and took years to implement. also, its only one school, and will probably be reversed by some suck-up leftist politician trying to win favor with the massive, political industrial-education complex.

How about simply eliminating all Federal aid to higher-education, and stop subsidizing student loans instead?

Less money means this nonsense automatically stops, everywhere.

[Java4Jay]

My daughter will graduate with MSW (masters social work) with $45,000 student loan debt after 6 years of college. We’ve worked hard at keep it at the that.

[LostPassword]

Get the government out of the loan business. Let banks, investors, and financial institutions give loans. They’ll determine which majors are worth giving a loan for and how much the cost of that degree should be. So, maybe “electrical engineering” is worth $100k in loans at 5% interest while “gender studies” is worth $20k (the max a student can borrow for it) and comes with a 15% interest rate.

Universities will adjust if they can’t fill the seats/dorms with students paying what the government decided they should be able to pay for any major they want to pursue.

[trublu]

Get the Federal government out of the student loan game. Make the SCHOOLS issue the loans. Make them stand behind their (worthless) degrees. You’ll see the number of grads with Philosophy degrees and $100k in student loan debt decrease greatly.

[trublu]

You beat me! Great minds...

[BobL]

I think their support for Mitch will quickly evaporate once they get out in the REAL WORLD and have to pay the tolls on I-90...due to Mitch selling off the road to the Spanish.

[tellw]

To win financial aid, students should do freshmen year at community college with an extra incentive to go 2 years and get the associates degree.

[camle]

Pudlo’s Law of Economics: in any economic system, be it transportation, health care, education, etc... costs will rise to absorb any monies poured into it. and in any economic system, when costs rise disproportionally to other systems, there is usually an influx of government dollars driving up those costs.

[Responsibility2nd]

Cutting colleges costs and expenses is easy.

Immediately cease and desist all taxpayer funded college loans. Immediately cease and desist all taxpayer funded grants and subsidies to colleges and universities. Immediately cease and desist all taxpayer funds towards salaries and expenses for our colleges and universities.

Shut down public universities. Let the private schools prevail.

Not only will academic standards skyrocket, but costs will plummet.

Easy.

[ProtectOurFreedom]

Very simple: Stop the government from trying to make it “affordable.” Watch prices plummet.

[Still Thinking]

Stop guaranteeing student loans. And allow them to be bsnkrupted, possibly with the exception of using the degree itself as collateral. Them backs wouldn’t fund stupid degrees.

[Agatsu77]

When I got out of college the first time in the 70s I owed right about 1 years salary for my new job in school bills. I paid it back in just over 8 years. For quite a while that was on average the going rate.

The $40k number in the article is still in this range if you study something aside from the social sciences (?science?), psychology or some kind art.

[Moonman62]

Colleges are there to enrich and subsidize liberals. Then comes indoctrination followed by education.

[gattaca]

bmp

[Demanwideplan]

Ol’ Bernie, who moved out of his parents house at the age of 43, saw the perfect timing in messaging the free tuition. Bernie understands very well just how indoctrinated and foolish 95% of high school graduates are!!

[Yo-Yo]

Over the past 30 years, the TOTAL COST to educate a student to a bachelor's degree at a public university hasn't risen more than the rate of inflation.

What has changed is the amount of state funding to public universities, and the resulting tuition increases to make up that shortfall in revenue.

You who went to college in the 1970s and walked away with very little to no student debt were the recipients of massive government subsidies for your tuition. Don't blame guaranteed student loans, or greedy universities, or undisciplined spending. You can either blame state legislatures or praise them for shifting more of the burden of an education away from the taxpayer and onto the student.

[Slyfox]

When I went to the University of Texas in the late 1970s, I lived at home and paid $45 per credit hour. A full load plus books was easy to handle and I left school with NO DEBT.

The gubmint getting involved in managing college loans coupled with the college's depending on the increased money it affords them is the problem.

[TheTimeOfMan]

Stop all subsidized student loans.

Require calculus for every degree.

Problem solved.

However, just for fun we could put most of the professors in dunce hats and then send them to the collective farms....

After all - it’s what they want.