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<p>Yes, I agree. That is why K-12 is free.</p>
<p>Right, and the system where the product is ‘free’ and supported by the state sounds very capitalistic to me.</p>
<p>It’s clear that even in those countries, education is not seen as a product that is ruled by typical market forces–that education is something different and therefore not priced in the same way as other ‘products’.</p>
<p>I think smart poor kids should get merit aid</p>
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<p>But the “model” you describe is such a bizarre distortion of reality as to be a wild caricature.</p>
<p>Look, my D1’s LAC gives away about $19 million in institutional need-based aid per year. Tuition is about $43K per year. So need-based aid is the equivalent of about 442 full tuitions. That means they’re foregoing about 1/3 of their maximum tuition revenue, relative to what they’d take in if they charged all their students full tuition. I suppose your point is they could simply reduce tuition by 1/3 and allocate all the seats by a combination of price and merit—those qualified who were willing to pay $29K in tuition would be admitted.</p>
<p>What would the effect be? Well, currently about half the students get need-based aid (meaning roughly half the students come from the bottom 95% of households in income and assets), with an average award of about $34K. In effect, then, half the class is paying an average of $9K in tuition. If you eliminated need-based aid and set tuition at $29K, most of those “lower SES” (bottom 95%) students would be forced to go elsewhere. Are there enough high SES (top 5%) students to replace them without diluting the quality of the entering class? Well, maybe; especially if other colleges didn’t follow suit, because then my D’s LAC would in effect be offering about a $14K tuition discount relative to its peer institutions. But it would certainly mean a less socioeconomically diverse student body.</p>
<p>But this ignores the fact that net tuition revenue (after FA) of about $30 million represents only about half of the college’s $60 million educational & general operating budget (exclusive of housing and food services, which are under a separate enterprise budget). Apart from tuition, the college also draws about $21 million from endowment, another $6+ million in annual giving, and roughly $3 million from other revenue sources. As a liberal arts college, it really does nothing except teach undergrads; in effect, then, its entire budget goes toward educating undergrads, directly or indirectly. So essentially, even the full-pay students at current tuition levels are already being subsidized to the tune of $11 million/year, or an average of $18K per capita. </p>
<p>Your proposal is for the college to subsidize all students at a flat rate of about $25K per capita so as to reduce tuition to a flat rate of $29K per capita, while effectively excluding lower SES students who couldn’t afford to pay the $29K flat tuition rate. I’m not sure what kind of moral value system would see this as a better or fairer result, nor do I see how it would advance the educational mission of the college, especially if other colleges went to a similar price structure. Top colleges would then be left to compete on the basis of price for a fixed pool of high-SES (top 5%), high-stats students, with the best-endowed colleges able to offer the steepest discounts, with lower-SES (bottom 95%) high-stats students left out in the cold. My D’s college is well-endowed relative to most, but that’s probably a losing game for this particular college as well, because its endowment is not strong enough to engage in full-scale subsidized price competition with better-endowed colleges. This doesn’t sound like the kind of place I’d want to send my D to college, or the kind of world I’d like to live in, frankly. Nor does it sound like the kind of world where it makes sense for taxpayers to lavish enormous tax advantages on colleges, so they can in turn offer deep discounts to the offspring of the richest Americans.</p>
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<p>I doubt Beliavsky cares about a socioeconomically diverse student body at all (at least from the perspective of where he wants to send his kids to school). </p>
<p>It’s one thing to say “let them eat cake,” which is what he essentially says about poorer students. Can’t afford a good school? Too bad, so sad, have a nice life. It’s yet another thing on top of that to say he feels he shouldn’t even have to pay for cake he can well afford because it might result in a crumb or two going to the poorer students.</p>
<p>@skrlvr,
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<p>Do you understand what capitalism is?</p>
<p>I think this focus on rich parents and poor parents is misplaced. I think it’s much more of a middle class issue.</p>
<p>My son attends Northeastern University on a full tuition merit-based scholarship. (I’m putting the name of his university out there because I’m not going near the third rail of what makes a “good” university and whether or not his is one.) Along the way I’ve met several other parents whose children are the in same position and we all have basically the same story. We saved/could afford on current salaries to send our children to state college but not to private. Let me repeat that, we could not afford private. Not “didn’t want to pay it” but could not pay it. Merit aid made the difference between our children going to a public university and a private one.</p>
<p>Interestingly, the one out of state public university that he applied to offered him enough merit aid so that the university would be the same price as our in-state one. I don’t think that was a coincidence. </p>
<p>Lest anyone think I’m arguing that privates are better and everyone with the opprotunity should take the chance, my son’s public university was UT Austin. I’ve yet to see a ranking where Northeastern came out on top of UT Austin. But Northeastern was a better fit. We did what people are always touting here; we set aside the rankings and went with fit. Merit aid made that possible.</p>
<p>I’m sure there are wealthy people out there who simply refuse to pay full fare at private colleges and take the merit aid instead but I truly do not believe their children are the majority of the beneficiaries of merit aid. I think most kids who benefit from merit aid are like my kid. </p>
<p>Should it really be the mission of private universities to only serve the rich and the poor? I think attracting a range of students is important, including socio-economically.</p>
<p>I think this thread actually illustrates one of the worst things in the American culture today. I’m sure it comes about because of a scarcity, or perceived scarcity, of resources, but there are any number of reasons a kid (forget the parents for a minute) might NEED merit aid, even if he or she was not eligible for Pell.</p>
<p>Deadbeat Dads, for one thing. </p>
<p>Parents who only recently reached a certain income threshhold and were not able to save.</p>
<p>Now, I’m not in any way saying I want money taken from the pell eligible, but we have to have different models if the goal is to educate our population, imho.</p>
<p>the real bottom line is that college is too expensive for the majority of Americans, for many reasons, and there have to be ways to fly “stand by” to use the airline pricing model, even for those the rest of us might think should be able to afford first class.</p>
<p>We are full pay, no matter where we go, but I put myself through college. When I look at the way it is priced out now, I can’t see how any kid could do that. So, some kids are putting themselves through school with their brains.</p>
<p>Polarbearvshark suggested on another thread that the cost of a state education should be held to the pell price for those who are pell eligible. Now THIS I think is one of the very best ideas I have heard on this board. AND we need ways for bright, middle class kids to get an education, as well.</p>
<p>carry on.</p>
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<p>You really hit the nail on the head. In the past, people did not get all bent out of shape over paying full freight, because even full freight was reasonable. The cost of college was not so hideously out of line with the cost of everything else.</p>
<p>Good point, poetgrl.</p>
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<p>Elite colleges? Or colleges in general? Every state has a state school and most have directional state universities, last I checked.</p>
<p>Anyway, I think for some people their station in life isn’t measured by what they have, but what they have in comparison to someone else.<br>
If an elite school cost only $20,000 (instead of the current $50,000 - $60,000), Beliavsky would still want it to be $10,000 because it would annoy him that he’d have to pay $20,000 and some poor kid might pay close to zero. His money utility appears very dependent on what other people have / pay. Me, I’m DELIGHTED that I’m fortunate and blessed and hardworking enough that I pay two elite schools full freight. What a “problem” to have that I have two kids who got in and the funds to do this for them.</p>
<p>Pizzagirl, as far as I am concerned, a kid ought to be able to put him or herself through school. Sure, maybe they could leave with some debt, but not the kind they have to take on today.</p>
<p>Even you will admit our state flagship is too expensive for parents from the median income bracket to foot the entire bill. Look, you and I can barely even “get there” in our minds. We are full pay. Full stop. Plus, we aren’t even giving anything up for that. I live the same exact life I lived before I had kids in college, and, I imagine you do, too.</p>
<p>But, there’s a whole range inbetween that and eligibility for finaid.</p>
<p>And state schools are not the bargain they once were.</p>
<p>ETA: I don’t care what Beliavsky thinks. I do care that there are kids in our state who can’t afford a four year education without enormous debt: some who are impoverished and some who are simply middle income.</p>
<p>And on the Pell issue, there are state schools whose tuition, but not COA, can be paid with a Pell Grant. That was how I went to college. In Maryland, Pell does not cover tuition at a four-year school.</p>
<p>I also wonder whether some of the money issues could be minimized if kids and parents took a seminar about how to afford school. We are so brand conscious as a society that our young people think they are too good to attend the schools they can afford.</p>
<p>We, too, are a full-pay family. Child number one was an academic superstar in high school. She was admitted to two top 25 schools, one in the top ten, but she followed the merit money. She helps her school’s statistics. I would hate to see merit money decrease, but luckily, I won’t need to worry about it until there are grandkids around.</p>
<p>I would hate to see merit aid get reduced or disappear. Without it, I don’t know how my daughter would have been able to attend her university</p>
<p>Poetgrl - in my area, it is not uncommon for students to save money on the state flagship by doing the first 2 years at a comm college and then the last 2 years at state flagship. I can’t say it’s necessarily a worse strategy than taking on lots of debt otherwise. </p>
<p>I guess I can’t really begrudge anyone aid, whether need or merit. I find it amusing that Beliavsky frets so much about it. Why not just be glad you don’t have to worry about it and move on?</p>
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<p>No, I would not object if colleges maintained “need-blind” policies while also keeping the list price constant in real (inflation-adjusted) terms.</p>
<p>I am following this thread with great interest and it is causing me to question my own motives a bit. If my son is accepted at a good LAC, 45K COA and is offered merit in the 15K neighborhood. My outlay is 30k, which is below my EFC anyway. Many I guess would consider this a good deal. But, because he is pretty good academically, he also qualifies for full merit at state U, which brings them down to 15 k per year. Am I to feel badly about making a good financial decision on his destination? I didnt get to this financial position in my own life, (not wealthy by any stretch, but better off than most) by not understanding a good deal when I see one. Am I somehow taking advantage of students less fortunate by taking advantage of my sons adademic efforts?</p>
<p>If you can’t come up with the money, absolutley cannot, then the answer is simple. You eliminate those unaffordable options. Those who live within a commutable distance to a community college go there and borrow Stafford money to go there if the parents cannot pay a dime and do not qualify for any loans either. And you work part time. </p>
<p>For full time college, it gets trickier because there are a lot of students who do not live within a commutable distance to a 4 year school, and room and board are expensive, necessary costs of going away to school. Such students have to find jobs, ways to get to an area near full time public schools, work for the room and board and get their education bit by bit on a part time basis. That is really the way most people get their degrees, by the way. The average college student is not the fresh faced high school grad off to sleep away college. Nope. Those are the privileged ones, either by parental largesse or scholarships or financial aid packages. If you can’t scrape up enough from those three sources, most of the time, you commute to school and work part time. Those whose parents are deemed able to pay but can’t for whatever reason, or won’t have the double whammy of not even qualifying for financial aid, though other than PELL, and some states that have funding, it doesn’t make a lot of difference most of the time, because most schoools, the vast majority do not meet need and rarely do. </p>
<p>There is a luxury component to providing college to one’s child. In many families, the high school graduate is welcome to continue living at home and get some , maybe most living expenses covered as he commutes to college, but commuting costs can be high too. I am lucky in that I live within commutable distance to a number of colleges, but the cost of a monthly train pass is not cheap and buying a car for a kid is hefty expense. Someone strapped is faced with that additional cost. It’s not like high school which is essentially free and some form of transportation is provided, and local carpool options are often easier to find. Not so when commuting to college. </p>
<p>Penzly, no you are not taking advantage of students less fortunate, in that the school feels that having your son as a student enhances their class to the point that they are willing to discount his cost there. If he doesn’t take the offer, it does not mean that it will automatically go to someone less fortunatel. My son went to a SUNY and got merit money too, and I was glad of it. I also paid for one kid to go to a LAC because I felt that all the factors in that decison led to the best direction for him and we were able to afford giving him that choice. To force a kid who doesn’t want to go to a school is often waging a losing battle because there are enough challenges in doing well in college without having a chip on the shoulder, so as a parent one does have all of those factors to balance. But putting one’s self on the financial limb for a kid’s college choice is very risky, and there are a lot of good options out there without doing this. Having been dealing with this for 15 years now and seeing young adults that I knew when they started the college experience, I can tell you a lot of the miserable kids are miserable adults even after getting exactly what they wanted.</p>
<p>Like pugmadkate. we face similar decisions this year. I have been a single parent for 14 years, covered the out-of-pocket expense after insurance of multiple surgeries DS required, and without child support for 13 years (that’s not a story for this forum, but it goes to the point that deadbeat dads can be one contributing factor to the need for merit aid) but I managed to purchase 128 hours of prepaid tuition through 60 months of payments I could barely afford. I saved another $20,000 toward college instead of my retirement (I am 56). Even together with what I can add now, this doesn’t cover a state school, much less our flagship, which DS qualifies for. </p>
<p>Merit makes a private college possible for a situation like ours, and it is by far the better fit for his LD issues - but what he brings to the private college will be stats that improve their rankings. I’ve come to see college as something of a marketplace, and I do agree that students these days “pay their way” with their academic performance, as another poster described it.</p>
<p>My own experience seems like an artifact from another era: I was awarded a full ride scholarship from my father’s company (a tire manufacturer), based on my grades; ours was a middle class family (dad was an accountant), I was “hookless” and not a URM. These kinds of scholarships have all but disappeared in this economy, as well.</p>
<p>The frustration for some is that “need based” does not seem to take into account area of the country, age of parents, the need to save for retirement vs anticipating a pension, childcare costs when both parents work and other factors. The EFC is often well above the amount a family is actually able to pay. In some cases, this is due to unwise spending (fancy vactions, a beach house, or luxury items) but in many others it is to ensure adequate retirement savings, a cushion in case of job loss, and living in a high cost area. This discussion should focus on the mean or median income of families with children, not just the state median which includes retirees, those just starting out etc. </p>
<p>Financial “need” also is difficult to define adequately. Is the need of a family with the exact same salary from one parent working the same as that from a family in which both parents work and thus face costs like child care or have no way to raise their income? Should the same income be counted the same way in Iowa and New York City? For someone who will receive a very generous pension as for someone who will receive no pension at all? For some families, the income may be modest but there are generous grandparents who fund college or provide a down payment on a house that is not (and clearly could not be) figured into the financial aid calculators. There are families receiving need-based aid in which the second parent could easily earn the income needed to pay for college, but chooses not to, long after he or she is needed as a stay-at-home parent. Also, in some cases divorced parents are not required to report the incomes of both parents, only the one the child lives with the most. In the situation where one parent makes little or no money but the other, non-custodial parent could easlity afford full tuition, is equally unfair. </p>
<p>Abolishing merit aid would not result in measurably lower tuition. Certainly, it may make sense to reduce the meaninglessly small merit awards of a couple of thousand dollars that while nice will not make a dent in the $50K+ COA. If that is what is being suggested, that money might well be better spent reducing tuition by a few K or by offering better merit aid. </p>
<p>If merit aid is abolished, state schools will be the only choice for many families that make a decent living but certainly can’t afford the tuition at most privates - that is truly can’t afford not simply are not willing to pay. As others have said, going to private college is a privlege, not a right, but it may result in colleges full of very wealthy kids and those that receive need-based financial aid (or can play the game in the right way). Not sure eliminating the bright, hard-working kids whose parents make too much but not enough is necessary a good way to run a college either.</p>