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Answering the Perennial Question: Why Does College Cost So Much?
James G. Martin Center for Academic Renewal ^ | Richard Vedder

Posted on 10/19/2018 7:09:36 AM PDT by reaganaut1

Last month, Amanda Riley, writing for The Atlantic, asked a good question: why does higher education in the United States cost significantly more than in every other OECD nation except Luxembourg? Related to that: Why have college costs risen sharply over time?

Unfortunately, while the questions Riley raises are compellingly important, the answers she provided are, in my opinion, severely wanting.

She fails to even fleetingly mention one thing unique to American higher education that has been an enormous factor in driving up costs: the federal student financial assistance programs. The money from those programs has provided universities an opportunity to raise fees aggressively, using the proceeds to fund a very costly and unproductive academic arms race, including ultra-posh buildings, climbing walls and lazy rivers, and college sports programs that are out of control both financially and morally.

From roughly 1840 to about 1978, when federal student financial assistance was either non-existent or of modest size, college tuition fees, adjusting for inflation, rose on average about one percent a year. Since 1978, tuition inflation has escalated to about three percent annually.

Careful empirical studies performed both by the New York Federal Reserve Bank and the National Bureau of Economic Research confirm what former Education Secretary William Bennett opined three decades ago: whenever the feds give another dollar of financial aid to students, colleges raise their fees by a majority of that dollar, capturing for themselves what was designed to help students.

As published fees have soared as a consequence, price-sensitive lower income persons have actually been increasingly turned off by college, so a smaller proportion of college graduates come from the bottom one-fourth of the income distribution than in 1970.

(Excerpt) Read more at jamesgmartin.center ...


TOPICS: Education
KEYWORDS: bennetthypothesis; college; collegecosts
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To: reaganaut1

Why does college cost so much?
Why is health care so expensive?
Why are my taxes 3x higher than they should be?


41 posted on 10/19/2018 8:32:57 AM PDT by Leep (Thanks)
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To: All

It’s all about the Benjamins....Let thousands of idiots who aren’t smart enough to open a peanut butter jar attend college, rake in the bucks, rinse, repeat.


42 posted on 10/19/2018 8:34:40 AM PDT by Maverick68
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To: reaganaut1
".... Why Does College Cost So Much?...."

When Obama nationalized the student loan program, colleges knew they could raise tuitions because the government was involved.

And we all know what happens to prices when the government is involved.

I graduated from Arizona State University in 1969. My instate tuition was $145 per semester. No student loans. Just worked three part-time jobs to pay my way through college.

I would not be able to afford college nowadays.

Which is why the government and the universities are making a killing off of the backs of the student's loans.

43 posted on 10/19/2018 8:47:46 AM PDT by HotHunt
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To: reaganaut1

Student loans, the loans made it easy to jack up the fees to pay socialist instructors much more than they are worth, also the outrageous salaries and benefits of the administration. They just keep jacking things up because the ignorant twaddle that attend are given easy access to what appears to be free money(to them) and they never ever consider the day the devil comes to collect.


44 posted on 10/19/2018 8:48:59 AM PDT by Mastador1 (I'll take a bad dog over a good politician any day!)
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To: rightwingcrazy

It was cheaper to send me to college than keep me at home.
In the late 70s, my state university in TX was $3/hr. In 1980, students were aghast when prices rose to $4/hr.


45 posted on 10/19/2018 9:04:33 AM PDT by bgill (CDC site, "We don't know. how people are infected with Ebola.")
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To: b4me

Taking courses at community colleges and online can really shorten the number of years and cost of college.


46 posted on 10/19/2018 9:06:05 AM PDT by cnsmom
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To: E. Pluribus Unum

Correct


47 posted on 10/19/2018 9:15:36 AM PDT by genghis
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To: Lurkinanloomin

Two words
On line
Two more
Audit classes
Public universities are just that
Anyone can sit in on and class anytime


48 posted on 10/19/2018 9:26:00 AM PDT by Truthoverpower (The guvmint you get is the Trump winning express !)
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To: Lurkinanloomin

if they really wanted to “fix” things...

1. Loan amounts and rates offered should be reflective of the realistic earning power of the degree. And/or viability of finding a job in that field.

2. Degrees with little to no earning power or should not cost the same as a viable major or a field of study that talent is needed.

EG: A 4 year (fill in the aggrieved party)-studies degree should NOT cost the same as a 4 year Engineering degree.


49 posted on 10/19/2018 9:32:01 AM PDT by uranium penguin
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To: reaganaut1

IMHO government subsidies are the major issue, but let us not forget the similarity to cable television.

With TV cable, in order to get that one extra channel, you have to pay for that channel and another additional 20 or so channels you will never watch.

College is the same way, there are many classes that fall into the realm of “individual enlightenment”, I.E. something you want to learn because of it’s interest to you, but there is no need to have a class for that.

These “niche” classes still require a classroom it’s associated heating/cooling/maintenance as well as the classes instructor, text book, hand outs, printed materials, etc.

Rather than running a college like a cable company, run it like an airline. Airlines will cancel a route that consistently fails to meet an established percentage of filled seats.

Colleges should do the same. If you can’t get at least 20 students to enroll in the class, you cancel the class. If the class is canceled three time in a row, you cancel the course. This would decrease overhead and decrease costs overall. It addition, it would get rid of many classes that offer no real world benefits with regards to employment opportunities.

Said another way, each class offered should be self-sustaining based on enrollment for said class.


50 posted on 10/19/2018 9:38:15 AM PDT by Sergio (An object at rest cannot be stopped! - The Evil Midnight Bomber What Bombs at Midnight)
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To: ExTexasRedhead

Totally agree. If any college or university accepts one penny of tax money, they should be fully open and transparent in their financials.


51 posted on 10/19/2018 9:41:58 AM PDT by Howie66 ("...Against All Enemies, Foreign and Democrat.....")
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To: ExTexasRedhead

Just look at what Fauxcahontas was earning
when SHE was teaching at one of these ivy league s***holes.

I would like to see ALL federal aid, aside from money for military aide, withdrawn from colleges. Inclusive of tuition reimbursement.


52 posted on 10/19/2018 9:57:31 AM PDT by ZULU
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To: reaganaut1

Liberals love money and they pay themselves very well at the public trough.


53 posted on 10/19/2018 4:20:26 PM PDT by minnesota_bound
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