Posted on 03/21/2005 4:15:13 PM PST by Helms
The Great American College Tuition Rip-Off By Paul Streitz Mar 3, 2005, 17:56
“How am I going to pay for my kid’s education?” is a nerve-wracking concern to most middle-class parents. “Why do college tuitions keep going up?” they ask. College tuitions have risen above the rate of inflation for twenty-years, not because costs have gone up, but because higher education has found that parents will continually pay more for their children’s education. If you are charging a dollar a doughnut at your store, and you double the price, and the line does not go down, you keep raising the price. Eventually, the price will go down by a lower price being charged by the store across the street.
But education is not the same as a free marketplace. Students apply for admissions to a college and the college accepts you or not. You do not apply to buy a doughnut. Each college occupies a unique position on the educational hierarchy, and all parents want their children to go to the “best” school possible. Therefore, there is a constant demand to move up the educational ladder, not the typical marketplace controls that exist with consumer products.
The rankings of U.S. News and World Reports are extremely important in this regard. They give parents the feeling that their child has accomplished something if the student is enrolled in a number ten school as opposed to a number twenty school. The ranking system is composed of many useful pieces of data such as the SAT scores of the students and the student-to-teacher ratios.
What is horrendous is that the USNWR rankings also include faculty salaries and the amount spent per student. While this sounds harmless or positive, the effect is to drive colleges to spend more and more money, and to never be economical. If a college doubled its salary to faculty, making no other changes, it would rise in the rankings. And the rankings are what a used by parents to determine the relative desirability of the schools. Consequently, every college is in a race to raise and spend more money. Tuitions go up because colleges want more money to stay in the rankings game. No administrator or college can charge less or reduce expenditures because their rankings would plummet. Tuitions continue to go up because parents are willing to pay. College tuitions have gone from about 20% of the mean family income in 1960 to over 50% today. It is vicious circle that needs to be broken.
Colleges with universities with higher endowments do not charge less for tuition. The money is simply spent. Williams College, the wealthiest private college, has $1.2 billion dollar assets but it does not charge any less than schools with a tenth of its assets. It simply wastes more. It stays on top of the rankings by outspending everyone else.
The financial tactics of modern private education are akin to the rape and run tactics of U.S. mining companies. These companies have historically stripped the land of all the valuable ore and then run from the billions of dollars environmental damage. The citizens of the state and federal funds pay for the mining companies’ short-term horizons and their denial of the secondary effects of their policies.
In a similar fashion, tuitions are set by the colleges based on how much money they can extract from parents and students. There is absolutely no thought about the long-run consequences to the students, the parents or the society. Colleges and universities regularly expect parents will go into long-term debt, such as a second mortgage, to finance their children’s education. When parents apply for a college aid the question is not just “How much have you saved for college?” The question is “What is the value of your house?” Higher education is engaged in financial asset stripping of both parents and students.
The secondary effect of the rapacious policies of higher education is the impoverishment of the middle-class family, which leaves many students with a mountain of post-college debt. It further destroys the middle-class with young families deciding to have fewer children because of the “high cost of a college education.”
Eventually, the rapacious policies of the mining companies were changed by enraged environmentalists, who brought the situation to the public’s attention. Eventually the public changed its mining practices because of stringent environmental laws. Similar corrections are now needed in the world of higher education.
In order to correct the financial, social and educational faults of modern education, the boards of trustees must be removed from operational and financial control of private colleges and universities. Without the later, the former is impossible.
Control of colleges and universities must go into the hands of Parent-Student-Alumni Associations. Tuition would go into an escrow account. The associations would then collectively bargain with the administration as to levels of tuition, staffing, social and academic issues.
Parents and students pay million dollars a year in tuition, alumni contribute thousands, but they have no voice in the decisions of the colleges and universities.
That must be changed.
Mr. Streitz has just published The Great American Tuition Rip-Off. (Available on Amazon.com) This fall his Bring Back The Jobs will be published. He was a candidate for the Republican nomination in Connecticut for U.S. Senate.
"The Great American College Tuition Rip-Off" by Paul Streitz Buy "The Great American College Tuition Rip-Off" from Amazon.com
© Copyright 2002, 2003, 2004, 2005 by Magic City Morning Star
There is currently a huge amount of wealth in endowments and their power has grown.
bttt
Eureka College (President Reagan's alma mater) reduced tuition last year from $19,000 to $13,000 a year. Big news and was reported on Fox News. With an academic scholarship my daughter is able to attend.
Very insightful article.
A friend of my wife has a daughter that just graduated from high school last year. The girl wants to go to cosmetology school, which is OK by mom, but dad insists that she go to college. I told my wife the girl had a much better chance of making more money and living a better life if she learned to cut hair than if she got a worthless degree from an Ivory Tower.
How were they able to reduce tuition? BTW, I think the federal funding of education is partially responsible for the inflation of school tuition.
Harvard and some other colleges have started letting any accepted student whose family makes $40,000 or less a year go there for free. This is the right way to go, or part of the right way, because for a family making $40,000 or less, even the small part of the tuition that they usually have to pay, or the payback of the loans, is a hardship.
$10k a year at state college....what a deal!
Professor salaries are certainly not going through the roof. If anything, academic salaries are mediocre. Where colleges are spending major money is on huge building programs to expand campus facilities and in sinking enormous dollars into the expansion of various kinds of research.
Just proves there's a sucker born every minute willing to pay big bucks to these clowns to complete the brainwashing of their kids, NOT educate them. Hire some lunatic cultist to finish your kid's "education" at home; it will be cheaper, quicker, and just as effective.
The prime reason for the increase in college tuition is that the feds keep subsidizing tuition! Every time the feds raise the grants and loans, the tuition floor goes up!
The elitist academics live in a fantasy world! Colleges pay them big bucks to work for themselves. Once a college instructor becomes tenured, he stops teaching (almost) and takes up research, conferences and committes and the school has to hire some one to teach the students. It is the same as the comapny who employs you, assigning every manager with more than 7 years service as a "loaned executive" to the Red Cross, United Way or some public good campaign and hiring managers off the street to actually manage the company.
If colleges, Williams included, were run like a Walmart, for example, tuitions would drop by 80%.
Well, sort of. The salaries for some superstar professors are pretty fancy, and a lot of tuition payments go into those salaries.
A co-worker of mine spent over $100,000 sending his two daughters to college. Both of them got married and then he got stuck paying for their weddings! Then one of them got divorced and moved back in with him with her two screaming kids. Neither of his two daughters ever got a fulltime job.
"Hell on Earth" is how he describes it.
Yeah, usually a grad student that (a) doesn't know how to teach, and (b) doesn't know a thing about the English language.
Basically you end up paying big bucks to get a teacher that makes less than the kid that cooks your burger and fries for lunch.
;^)
Ward Churchill seems to have been doing ok. I think I could get by on his $96 thousand a year salary but maybe my needs are just simple. I wonder what he makes with all his speaking engagements thrown in.
If folks don't want a branch or sub-branch of Ivy, they don't have to take it. The question is, is the investment worth it? Clearly, given the prices being paid, the answer is yes. People wouldn't pay it if the returns, in whatever form they may come (pride, results, whatever) didn't come.
Government subsidies, scholarships, and tuition grants don't change the fact that most Lib Arts students pay full retail. That very small rest are subsidized by them. Same goes with our tax code. As with taxes, when does that point of diminishing returns hit? I'm guessing we're near it.
bump for later reading
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