The Unsustainable Cost of Higher Education
Decatur Metro | December 3, 2008 | 5:16 pmEchoing my recent exasperation regarding the mind-blowing increases of college tuition and fees over the past few years , the New York Times reports on a recent study that concludes pricing trends can’t continue along their current path for much longer without ending very badly.
Money quote…
Over all, the report found, published college tuition and fees increased 439 percent [emphasis mine] from 1982 to 2007, adjusted for inflation, while median family income rose 147 percent. Student borrowing has more than doubled in the last decade, and students from lower-income families, on average, get smaller grants from the colleges they attend than students from more affluent families.
“If we go on this way for another 25 years, we won’t have an affordable system of higher education,” said Patrick M. Callan, president of the center, a nonpartisan organization that promotes access to higher education.
….
“The middle class has been financing it through debt,” he said. “The scenario has been that families that have a history of sending kids to college will do whatever if takes, even if that means a huge amount of debt.”
The report, “Measuring Up 2008,” is one of the few to compare net college costs – that is, a year’s tuition, fees, room and board, minus financial aid – against median family income. Those findings are stark. Last year, the net cost at a four-year public university amounted to 28 percent of the median family income, while a four-year private university cost 76 percent of the median family income.
This sounds like another case of unsustainable debt to me. While a college grad with job prospects is a better bet than a subprime mortgage holder, that could change in a few years as jobs become more scarce and grads can’t find jobs quick enough to start to pay these loans back. The increases cited above MUST become decreases in the recent future, otherwise tuition rates will be the next figure we see declining.
There’s a reason the HOPE Scholarship has become the most coveted middle class entitlement program since the mortgage interest deduction (said with full disclosure that I’m a middle class homeowner actively pushing my daughter in the general direction of a 3.0…).
I will pay $100 to anyone who can post one comment without using the word “sustainable” or any derivative of said word.
See mine above, LW. Please make payable to CASH.
LW – that doesn’t seem like a sustainable offer… doh!
sustainable
darn.
Our oldest child graduated from a private liberal arts college in 2001 with total costs per year averaging around $14,000. The cost of his first year (1998-99) was around $10,000. Thankfully, due to his GPA and his own initiative at working as a RA (two years) as well as scholarships, we only had to pay out around $3000 out-of-pocket for the last year.
Fast forward seven years later when his second younger sister applied to the same school, possessing a higher GPA. One year will now cost $22,000 *not* including books, transportation back & forth from TN, spending money, etc.
My husband is a public school educator of 25 years in the City of Decatur Schools. With a master’s degree and that many years, he makes a good salary – better than many other systems in the metro Atlanta area. However, his salary has *not* increased to the same extent that college tuition has risen.
In our daughter’s case, she chose to stay locally at Georgia Perimeter College – Dunwoody for the first two years, transferring to UGA next fall. With her GPA, she now qualifies for Hope.
As much as she initially wanted to attend the same school as her brother, her plans to go to medical school caused her to rethink about the costs of college as she knows she will have school loans from medical school to deal with after graduation. In her words, she doesn’t “want to be in debt for the rest of her life” for college.
We have one more child to put through school who is now an 8th grader. I don’t even want to think about what it may cost in four years for her to go.
You know … more and more families/kids are making the decision you made Merri. I think that in time the market will take care of the excesses of colleges and universities an force costs down in the next decade. Otherwise private colleges will only be able to attract the underachieving kids of the super wealthy.
Part of the problem is that someone along the way got it into their head that students need to live in the lap of luxury for four years. Look at Emory’s “dorms” off of Clairemont. It looks like a five star all inclusive resort and has little to do with educational quality. I keep looking for the cabana boys and the slot machines when I go there.
My dorm room was tiny and dingy and we had no multi million dollar athletic center. If I needed exercise I put on some tennis shoes and went for a jog. If I needed a quiet place to study.. I went to that thing called the library. I never occurred to me that I was entitled to resort living at age 18.
Boy, I’m starting to sound like an old coot!
Amen Mr FixIt!
I realize that colleges are competing for students (and their wallets), but when did every campus suddenly become comparable to a cruise ship? When I was in undergrad (early 1990′s) we didn’t even have telephones in our dorm rooms. There was one pay phone that was shared by the ~100 guys living on our floor. And this was at one of the ‘elite’ schools up North. OK, enough old person ranting.
I also agree with Merri – the path for many more students will involve a couple years at a local, then off to the dream school where you can rack up only 2 instead of 4 years of debt.
Luckily, I opened a college fund for our baby late last year and invested all of it the stock market, so we won’t need to worry about these expenses. Let me see how that fund is doing…wait a sec…down how much?…uh-oh…
While dorms and exercise facilities are presumably in (perhaps a very small) part to blame, the Times article doesn’t mention anything like that as the cause of the steep rise; instead, it notes that a sharp drop in state funding has led to large rises in public school tuition. It is silent on private school tuition. I am certain that faculty pay isn’t the problem here. Can we really blame a 500% price rise on an outdoor pool, like at the Clairmont facility at Emory? And, by the way, if you ever venture inside those “luxury” apartments, you will quickly realize that they aren’t luxury. I visited a friend there once, and was surprised to see that the hallways are open-air and bare concrete, and the apartments themselves are pretty small. They’re also for graduate students, many of whom live there packed in with their spouse and children. The undergrads live in pretty typical 1960′s dorms, from what I can tell, except for the new one that opened up last year. So: is it really building a pool that makes Emory cost so much for undergrads?
Other changes are being made as well. Here is a letter from Georgia Perimeter College President Anthony Tricolli to faculty and staff:
Dear Colleagues:
As indicated in my e-mail on November 18, 2008, we have been waiting for definitive information from the Board of Regents on the budget reduction. Based on revised economic conditions from the Governor’s Office, the System is now currently planning for an 8% reduction in funding. The reductions are designed to achieve approximately $181 million in cost reductions throughout the system.
· As a result of the board’s action, each of the USG’s 35 member institutions will reduce the employer contribution rate for PPO and HMO health insurance plans from 75 to 70 percent resulting in an additional $8 million in savings throughout the system. The employer contribution rate for the Indemnity plan will be the same as the PPO plan. The employee rate for these three plans will increase. Rates for the high deductible plan will not be affected. The college will re-open the open enrollment period for health benefits to allow employees to make different choices based on these premium changes.
Detailed information on these revised premiums and the special open enrollment process will be sent in a separate communication from HR.
· The System will implement a temporary, one-semester student fee of $100 for research universities, $75 for comprehensive universities, and $50 for two-year and state institutions to offset an additional $20 million in budget reductions at these institutions. This student fee will be assessed for spring semester 2009. We are currently developing a plan to collect this fee and to communicate this information to our students in the very near future.
By making these difficult decisions, the BOR hopes to protect the System’s core teaching mission, while keeping operations strong, provide reasonably priced healthcare benefits and maintain academic quality.
On a very positive note, the Chancellor stated in a letter dated December 1, that institutions could proceed with plans to award merit salary increases January 1, 2009. Therefore, the merit salary increases that were included in faculty contracts and staff salary letters issued in June 2008 will be awarded as planned.
Participation in this plan ensures that GPC will be able to maintain the academic quality our students expect and deserve. Please know that you have my heartfelt appreciation for all that you do for Georgia Perimeter College. Working together, we will move forward even in these exceptionally challenging times.
I will be sending you further updates as they become available.
I’ll see you soon.
AT
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