The Vicious Circle of College Tuition

25.38K

Hamilton Nolan

09/05/13 04:16PM

Filed to: higher learning

Colleges have a problem. Their student-customers are having a harder time affording higher education. At the same time, government aid is being cut. So colleges raise prices. And then...wait a second.

That's one of those vicious circle things we're always hearing about. A new KPMG survey of college leaders reveals a bit of an issue in the standard college business model. See:

Asked to identify the major factors affecting enrollment at their institution, 58 percent identified parents/students inability to pay tuition as the top factor, compared with 49 percent last year.

But then:

When asked to identify the measures being adopted or considered as a result of cuts to federal and state funding, 51 percent of respondents said raising tuition.

Hmm. If only magic could resolve this predicament.

Fifty nine percent of those surveyed, compared with 41 percent the previous year, said the top step their institution is taking to address issues such as cost, quality and access to education is putting more focus on innovative approaches such as online education, without compromising quality.

There we go! It's as simple as using "innovative approaches," for less money, "without compromising quality." Why didn't we think of that?

For their part, parents say they plan to use innovative approaches such as counterfeiting $100 bills, without compromising quality.

[KPMG. Photo: Shutterstock]

The following replies are approved. To see additional replies that are pending approval, click Show Pending. Warning: These may contain graphic material.

10

onehappyman Hamilton Nolan 09/05/13 04:38PM

My daughter just started her first year in college.
We ran through the numbers with her since she was going to carry the burden of paying for most of it. In the end, I would say her/our decision was based 75% on cost.

When we told the schools she had been looking at that we had made our decision and why...the level of snark we got in return was almost comical. There was this odd arrogance and disgust that we we let mere money govern our choices. One even made it sound like our decision would come to haunt us and he wondered aloud if college was right for her since we weren't willing to pay for it.

Maybe when a few big name colleges go bankrupt they will think about how they do business. From my experience, it cannot happen soon enough.

2

thehoopoe3 onehappyman 09/05/13 04:57PM

This happens on the professional end too - oh, not willing to adjunct / fellow for minimum wage for grad school plus a couple more years after? Then you don't want it bad enough. It's not a problem for people whose parents pay for their existence though.

2

Jennifart onehappyman 09/05/13 05:20PM

I had the choice between Vandy or UCF. I had 75% of my tuition paid for by choosing to attend UCF. Best decision ever, not just because of finances, but for endless reasons.

My parents sat me down and went over my options with me, much like you did with your daughter, and I am eternally grateful for their input. I wish every kid had access to that same type of guidance.

1

andthenshewaslike onehappyman 09/05/13 05:22PM

Good for you. My cousins are paying sticker price for their kid to go to a not so great private school. They can afford it, but it's like setting $200k on fire. It makes no sense at all: Mediocre academics, small alumni network, little name recognition. But it's "the experience she wanted." Totally bizarre.

1

LiliVonShtupp onehappyman 09/05/13 05:27PM

I moved to a state with a very good law school and lived there for two years and finally applied to law school. I got into one or two slightly higher ranked schools, but ultimately went to the state school. My tuition was less than half of what it would have cost at the private schools. I was even able to pay for tuition for one year from the money I earned over the summer. I managed to graduate without debt from law school. It has made all the difference in the world. I still say it's the best bargain shopping I've done (or will do) in my life. Being free of debt opens up more doors and life choices. Those snarky administrators should be ashamed of the pressure they tried to put on someone who was making a wise decision for his or her daughter.

68

thehoopoe3 Hamilton Nolan 09/05/13 04:19PM

Funny how administrators never suggest cutting down on the number of administrators.

1

KarmaII thehoopoe3 09/05/13 04:25PM

^^^ THIS!!! Administrators are paid are too much in the current college structure when we should be focusing on access to scholarships and professor salaries.

10

TallBFree thehoopoe3 09/05/13 04:25PM

Well, the university where I work just implemented a pretty hefty budget cut, and the administrative units were cut at twice the rate the academic units were cut . And this was a directive from our president. So administrators do, in fact, on occasion, suggest (and implement) the elimination of administrators.

33

Ossirian thehoopoe3 09/05/13 04:29PM

Also maybe cutting the salaries of the coaches so they aren't making up to 10 times as much as instructors.

5

Ara_Richards Ossirian 09/05/13 04:31PM

But everyone knows that students learn more when the football coach is making over a million dollars, it's just a fact.

*vomits in lap*

28

Ara_Richards Hamilton Nolan 09/05/13 04:28PM

There will be a day of reckoning for colleges and I can't wait for it to happen. They have proven that they could care less about their students, it's all a money grab for them, and by them I mean administrators, not the actual professors themselves. I know all that money isn't going to the professors and that they have no power over the policies the schools adopt.

These administrators run schools like a business, that is with profits in mind. No matter the tax status, it's about the money, which they then use to try to build prestige, such as new athletic facilities and luxury dorms and whatnot. The fact that millions of people are being screwed over never crosses their mind, because they are getting theirs and that's all that matters.

If colleges start shuttering I don't think I'll have any tears left to shed, they have been all used up fretting over the huge bill for the massive mistake I made when I was a teenager.

4

goldenrae Ara_Richards 09/05/13 04:36PM

For-profits, yes. Not for profits no. And it's critically important to make that distinction.

WaterWish Ara_Richards 09/05/13 04:41PM

I could not agree more. This conversation has been going on for a few years now, and I have been patiently waiting for that bubble to burst. Unfortunately I don't think it's going to happen in the next three years (when my kid goes to college), especially because colleges and universities have just begun milking the foreign market as DobrySoldat points out. We're going to need some very astute legislators in the next several years who are passionate about this issue so we can put a greater focus on making college affordable for all who are capable.

1

Ara_Richards WaterWish 09/05/13 04:59PM

They are going to milk the foreign students for all they are worth, no doubt. They know deep down that this is unsustainable, so they have to look abroad for more money. The end result is going to make higher education the realm of the rich again, but then I think about the debt. Debt is a great way to keep people depressed and unwilling to do much else, so they plow away at work, never being able to fully engage with the world around them because they develop tunnel vision with regards to their debt. Either way the masses are going to be held down by debt, while those collecting the money laugh at the top.

That's why I try to beat into people the need to stay within their state and go to a public school, unless they have rich parents or a full ride. Even a full ride can be yanked away at any moment, just as with any scholarship. Do as much work over the summer at a community college and work a job to save up for books and whatnot. Even with a job it will take a lifetime to pay back the debt. The only person I know who has paid off all their debt was only able to do so from a settlement they received from being hit by a car while on his bike. Hell of a way to pay off the debt.

5

Bonfirez goldenrae 09/05/13 05:02PM

I went to my undergrad at a small for-profit health care focused school, to get my BSN (bachelor's of nursing). They would fire their tenured faculty as soon as they hit a certain pay grade, including one biology professor who was up for a nobel prize for some of his work (was unfortunately beaten out, but it was really exciting being in his class when he heard from a colleague that his name was really in the running). Therefore, by the time I graduated, only two of the professors I had were still there. All others had been fired and found jobs elsewhere (this really screwed me for my grad school apps). This college has a huge pharmacy program as well, and brags about how 2/3 of their pharmacy students fail out after the fourth year (it's a six-year program) because of how hard it is. Now, it is hard, but you don't see nonsense like that from not-for-profit pharmacy schools. They tend to require reapplying to the program after two years, and folks that don't make it will go get a bachelor's of science in bio or chem. At this school, you're effed. Four years of tuition down the hole, and you have /nothing/ to show for it. Not even a consolation bachelor's. I saw so many smart kids end up working minimum wage jobs and trying to go to community college to get some sort of credits so they can do something with their lives. It actually chokes me up a little talking about it, because it is such a waste of potential. And for what? For money for the administrator's pockets. It makes me sick.

I'm now in grad school, at a non-profit Jesuit university. The difference...is night and day. I'm not afraid to get to know my professors, because they will be around later, and won't blame us for any issues. I'm enjoying my classes and meeting people, and not worrying. Yes, tuition is still expensive, but the quality of the learning environment...I never realize how bad it was at my undergrad, until I saw how it should be here. I didn't realize how much my undergrad effected my viewpoints of those in authority, until I found myself acting oddly around professors and finally realized why. There's no grade inflation here, no scales for the purpose of keeping everybody here (at least until the fourth year). You earn what you earn, and the profs will help you.

The profs aren't always angry, or stressed, or not real PhDs. No lie, my alma mater would hire chiropractors and have them teach bio and chem, because they're cheaper than PhDs but they count as "doctorate trained" when it comes to college scoring on the US News report. Yes, I too want to be taught the basic sciences from someone who believes in magic. Oh wait, I was. It's scary. As a stupid 18 year old, I didn't know what to look for in a college. Wait, let me rephrase. Un-worldly. I was damn smart, but I was awed by the nice dorms, nice location, and fancy classrooms. I was the oldest, as well, so my parents didn't know (yet) how college had changed. Anyways, just my long two cents. It's a messed up system, and it is absolutely hugely important to differentiate between the for-profit and the non-profits here, because the difference is enormous.

9

Steve_Buscemi's_Orthodontist Hamilton Nolan 09/05/13 04:41PM

Alternative (slightly destructive solution):

End the federal backing of student loans.
Allow students to default on loans.
Force costs of loans to rise.

In the short term, the cost of Big College becomes too prohibitive for some.

Big College will lose money.

Big College will then have to cut it's degrees in Underwater Basket Weaving and no longer host symposiums on Neo-Feudal Cat Videos and their Impact on the Socio-Economic Structures of 5th Century Guam.

Big College will have to focus on degrees that offer employment and the entire inflationary debt trap will crumble because Big College will no longer be able to rely on guaranteed income from Big Government

Big College will have to provide something of value.

Oh, and they need to shoot the fucking SEC.

- a liberal arts major

6

The-Gray-Adder Steve_Buscemi's_Orthodontist 09/05/13 04:53PM

Another slightly less destructive alternative. Ration college degrees, or at least, the public financing of them. Unless you major in something that we want (STEM), no money for you - unless you're near the top in your field, and then there will be a cutoff. I'm operating under the idea that we need English and drama and film and history majors too, just not so many, so finance the best and to Denny's with the rest. Unless you have this really big bag of your own (parents') money you don't mind parting with, that is.

- a computer science grad student whose company is footing the bill

21

KinglyCitrus Steve_Buscemi's_Orthodontist 09/05/13 04:59PM

Yeah, let's allow the The Market to sort this one out. Because it's not like The Market caused this whole fucking situation in the first place, or anything. No, no, no. That was the students' fault, or Obama's, or something. Attaching massive profit motives to education is never a bad idea. We could solve all of our problems if the government would just totally fucking abandon the economy and we were all libertarians!

Steve_Buscemi's_Orthodontist The-Gray-Adder 09/05/13 04:59PM

That's not a terrible idea.

Steve_Buscemi's_Orthodontist KinglyCitrus 09/05/13 05:05PM

The Market (ohh, I loathe The Market) doesn't exist when it comes to college tuition.