Why has the cost of college gone up so much?

Paying for College
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<p>“Still though, the federal government should not have a hand in schools run by the state. It’s inefficient and I believe the reason for tuition increases. We live in the United States of America not the United STATE of America. The federal government is WAY too big. It plays a role in many sectors, not just higher education. More times than not it leaves these sectors in worse shape than they found them.”</p>

<p>OK…but that does not have anything to do with this conversation. </p>

<p>Tuition refers ONLY to the part of the price/cost to educate each student. State governments/taxpayers pay part of the overall cost for each student–kind of like K-12, only at the college level we expect students to bear PART of the cost. </p>

<p>Here’s an oversimplied example of what I’m trying to say: </p>

<p>1985 Price/Cost PER Full Time Student 10,000 (in 2013 $)
Subsidy: $7500
Tuition: $2500</p>

<p>2013 Price/Cost PER Full Time Student: $10,000
Subsidy: $2700
Tuition: $7300. </p>

<p>The availability of federal funds has not caused an increase in the total price of a college education. </p>

<p>Look at Bob Wallace’s graphs. </p>

<p>The director of the Center for College Affordability is Richard Vedder…hardly a source of objective analysis. From his own report:
“Many scholars have examined the validity of the Bennett Hypothesis. A NON-RANDOM sample of findings includes…” hmmmmmm :)</p>

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<p>Yikes…sorry…I did not finish one of my sentences above: </p>

<p>“Tuition refers ONLY to the part of the price/cost to educate each student”…</p>

<p>should end with…</p>

<p>which is paid by the student.</p>

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<p>Since the colleges got more grade and as there is a demand for best colleges. Also banks are ready to give loans for students easily. So no where on can say I can’t pay the fees.</p>

<p>Also Employers seek best colleges, so considering the job opportunities the fees are hiked.</p>

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<p>Did you stop reading after you read that? As far as I could tell, a non-random sample seemed harmless for what he was trying to point out there: that there were opposing viewpoints to the Bennett Hypothesis.</p>

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<p>He points out in the article why a gold standard or any direct evidence supporting the Bennett Hypothesis is unlikely due to the fact that the only way to obtain this evidence would be objectionable on moral and political grounds.</p>

<p>Give the report a chance. Read it in it’s entirety. I’d honestly love to hear your opinion on it as it seems you are pretty damn good with numbers. Some of the things in there were over my head as I’m by no means an expert on the subject.</p>

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<p>From [The</a> Socialist Economics of College Tuition](<a href=“http://www.slate.com/articles/news_and_politics/hey_wait_a_minute/2002/05/the_socialist_economics_of_college_tuition.html]The”>The socialist economics of college tuition.):</p>

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<p>Collegeguy, OK…I will read the whole thing this weekend sometime. However, I know that Vedder has been taken to task many economists on both sides of the political aisle over his penchant for manipulating data and analyses to support his political agenda. He is also funded by multiple conservative organizations. Knowing all that, I doubt I’ll be very open minded about the conclusions of the article.</p>

<p>Stitch…I read a quote the other day by from the president of some Ivy or sub-Ivy private school who noted that they could cut their tuition by $10,000 and they’d immediately get 10,000 fewer applications. That reminded me of a conversation I overhead at Best Buy a couple of years ago: </p>

<p>Customer: Why is that $1000 TV better than this $600 TV?
Salesperson: Uh, because it costs more.
Customer: OK. I’ll take that $1000 one then. </p>

<p>True Story.</p>

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<p>Obviously there are multiple factors as to why tuition at both public and private colleges has far outpaced inflation. One, the number of administrators on every college campus has increased exponentially in regards to the number of students. Why? Because every college now needs an entire bureaucracy to meet the needs of the politically correct world we live in (entire departments for Diversity, Sustainability, etc…all unnecessary in terms of actually educating the student body). Two, the explosion of PC departments on all campuses to mollify every possible group that exists (seriously, do we really need a degree in LGBT studies?). Three, at public universities the benefits provided to professors that teach as few as six hours a week have gone through the roof (that includes sabbaticals every few years, unheard of skyrocketing medical benefits, and tenure, which provides a job for life regardless of the quality of teaching). </p>

<p>And yes, without a doubt, the “easy money” that the Feds throw at the universities allows them to simply increase their “retail” tuition prices. You have simply got to be ignorant not to understand the simple concept that any subsidies provided by the government always drive up the cost of the good being sold (see Milk, Electric Cars, Solar Energy, etc… as low hanging fruit examples).</p>

<p>Now, the question becomes, have the universities reached a breaking point in terms of the product they are offering? $60K a year for an education? Seriously? Once the student loan bubble bursts we’ll see how that pans out…</p>

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<p>“You have simply got to be ignorant not to understand the simple concept…”</p>

<p>On that note, I’m out…</p>

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<p>Inflation?</p>

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<p>Well, no, because the cost of college has drastically outpaced inflation. See:</p>

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<a href=“http://i49.■■■■■■■.com/1incdv.png[/IMG]”>http://i49.■■■■■■■.com/1incdv.png

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<p>Dry up them federal teats, and we’ll see how high the costs will continue to go.</p>

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<p>Financial aid, I wouldn’t say it is expensive now because of it, but in general the reason why tuition is high is financial aid in my opinion. If colleges know people will get money from the government aren’t they most likely going to take advantage of this to get more money. They wouldn’t be charging too expensive tuition if they knew that everyone was going to end up paying out of their pocket or else they would really not have that many people going. Just my opinion, but I think if there was no financial assistance from the government, tuition would go down.</p>

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<p>1) Colleges are labor intensive with professors teaching classes and don’t benefit from automation the way IT has transformed business
2) Administration costs have grown disproportionately
3) Colleges are competing over extras
4) colleges charge similar tuitions</p>

<p>College costs are cheaper in the rest of the world where there are more large seminars
The most cost effective sector of education is probably the community college, which uses lots of adjuncts who receive no benefits.</p>