First entry
Getting there isn’t going to be easy, and that’s why we hope you’ll join in on the journey as well as the blog. One of the biggest obstacles to college access is cost. Consider the facts:
Tuition increases have made college less affordable for most American families. Increases in the past decade have outpaced inflation, whether measured by Consumer Price Index, Higher Education Price Index or the Higher Education Cost Adjustment. Increases have outpaced both family ability to pay and increases in grant aid. On average, the cost of attending a public four-year college now consumes 28.5 percent of average annual family income. For a four-year private college, education cost eats up 67.5 percent of this income.
Federal and state financial aid has not kept up with increases in tuition. At the Federal level, the Pell grant has actually lost purchasing power. As the latest study reports, a maximum Pell used to cover 77 percent of a public four-year institution’s cost, but it now covers only 41 percent. The award used to cover 36 percent of a private four-year cost, but it now covers only 16 percent. While Congress is debating a welcome increase in the maximum award, it is unlikely to keep pace with even last year’s average tuition increases — $487 at four-year publics and $1,132 at four-year private institutions.
At the state level, there’s a shift toward aid that is not based on financial need: from 91 percent need-based aid in 1981 to 78 percent in 1999.
Institutional aid now serves other purposes. Institutional aid increasingly is used to recruit specific students or to maximize net revenues. This practice reduces the amount of aid left for college-qualified, needy students. (Need-based aid on campuses did increase 41 percent in the 1990s, but merit aid jumped more than 200 percent in the same period.)
Student loan debt is soaring. The squeeze between increasing price and aid that hasn’t kept up has brought about record student loan debt. Many first-generation families are unwilling to take on this debt. Student loans work if the student indeed graduates and then has the earning capacity to pay off the loans. But, less than half the students who start college actually finish, calling into question over-reliance on debt.
Tax strategies are mismatched. Low-income families are unlikely to make enough money to save for college and qualify for federal tax breaks that are geared toward helping middle-class families.
We think the college costs obstacle can be overcome, but it will take some able people, armed with creative solutions, who are willing to do so. Some possible solutions have already been suggested, and more are coming. Lumina Foundation has recently published an issue of Lumina Foundation Focus magazine, which lays out the issue. We invite you to read the issue and submit your comments to this blog. Over the next several months, this blog will chronicle the progress of the journey. Please review the rules of engagement and join us.
Welcome aboard!
September 22nd, 2005 at 12:20 pm
The decades of annual tuition increases have been accompanied by array of apologetic and descriptive literature in both the professional and popular presses. The bulk identifies the unavoidable costs of doing business. Goods, services and salaries simply cost more each year and must be passed on to the student and their sponsors. Some authors put a positive spin on the otherwise bleak data. Students and their sponsors simply do not pay the full cost of their post-secondary education. Public institutions cover the difference with tax dollars, other government revenue, auxiliary enterprises and endowments. Private institutions do it primarily with endowments and other revenue sources. Yet students still pay more each year for the same ill-defined product.
A multi faceted problem, much is said about what sectors outside of higher education can do to address the problem–more government aid, parents should starting saving more, high school should produce better prepared graduates, states should relaxed restrictions, etc. By default, cost increases are viewed as inevitable. Colleges are generally given a pass.
Without greater scrutiny and restructuring of the inviolate academic production function (the mix of human, curriculum, delivery and relatively straight forward management principles), the status quo likely will be preserved and cost containment will remain a goal rather than a reality. Restructuring the production function will be widely perceived as an attack on faculty autonomy, prestige and status, academic freedom, quality and other academy traditions. The cynic in me also adds the potential threat to jobs. Productivity gains are possible but will require going to the core of our traditional beliefs regarding the delivery of quality learning opportunities.
I have developed a description of a heretical, “no frills” approach to cost containment that I would be happy to share.
pat leonard