President Obama sent a shot across the bow of higher education in his 2012 State of the Union Address when he said, "Let me put colleges and universities on notice: If you can't stop tuition from going up, the funding you get from taxpayers will go down." Was this a well-researched policy statement intended to increase the competitiveness of our nation, or an appeal to young voters and their parents during an election cycle?
Whatever the reason, it has started an active and heated dialog about the costs of higher education. Let me put my bias on the table: I believe deeply in the economic and human value of high-quality education at all levels. So, of course, this thinly-veiled threat of government intervention (price controls?) caught my attention. Yes, it was bound to happen sooner or later: just a few years ago, the escalating cost of healthcare was the public scapegoat. Higher education was due its turn at the political whipping post.
There is no sidestepping the fact that the cost of a college degree is a major financial stressor for most American families. Next to your home, a college education for your child is one of the most expensive "investments" you will likely ever make. So is it worth it?
Critics have actually begun to question the financial value of a college degree. The cost has indeed increased significantly over the years. But rather than just examining the cost, a better question would be to evaluate the return on the investment that this advanced education provides. Here the economics get a little murky, but under reasonable assumptions, a university degree still pays off handsomely. Some rough math provides insight: the "all in" sticker price for a four-year degree varies widely, from $75K at, say, Florida State to more than $200K at Harvard.
Typically, the costs to families are much less when aid and merit support are factored in. So what does this investment get you? Individuals with a Bachelor's degree can expect to earn $2.27M over their lifetimes, while those with only a high school diploma will earn $1.3M, according to US News.
I went to college and grad school and don't regret it. Along with the classroom knowledge I learned about critical thinking, how to examine and solve problems, how to design experiments, how to work with teams, and so on. I also made many helpful professional connections, worked with mentors--good and bad--made lifelong friends and learned a lot about how to live life and be a useful part of society. I suppose you can learn some of those things without a college education, but if you can go to college, I recommend doing so. Also, we have many good, inexpensive state schools in the USA, price doesn't always mean quality in college education.
I think college makes sense in this discussion because many of us majored in engineering, which tends to start paying back immediately upon graduation. But I think it gets dicier for people who don't have degrees that create a foundation for job training. I realize college isn't just about job training, but I would have some second thoughts these days about sending a child to college at one of the $50K-per-year liberal arts schools. Those schools work for kids who want to go to law school, med school or graduate school, but the paybacks are less certain (especially in a tough economy) for kids who don't use their education as a springboard for even more education.
According to "The Surprising Causes of Those College Tuition Hikes", "increases in spending were driven mostly by higher administration, maintenance, and student services costs." So, what do you see as driving the costs ever higher?
Discussing the ROI is interesting but implies that the rising cost is just a given and so is to be accepted, as it will be paid for over a life time. The big problem, as discussed in "The Bell Curve", is that higher education has already stratified American society, leaving many unable to attend even before the ever increasing cost is a consideration.
Let's not forget the trap that so many young people unwittingly fall into: the school loan. Smart loans are definitely an oxymoron and while the premise of borrowing for something as important as education has merit, I don't believe we educate young people as to the ramifications of borrowing (often well-over the actually tuition amount) rather than working and paying at least part "as you go." Many people become weighed down by loans that never go away although the finance companies are happy to temporary defer payment while continuing to accrue interest when hardships happen.
I am also a huge proponent of community college for the first two years. I have been paying into the Texas Tomorrow Fund since 1999 for my son's junior and senior year – fully expecting him to work and attend community college for his first two years as an affordable and character building option. Now that high schools offer dual credit (college and high school) tuition free, we are also looking forward to him graduating high school with several hours of college credit under his belt.
As far as where a student goes, I think accreditation is a key factor that sadly is often overlooked or misunderstood. There are lots of fine non-ivy league universities that offer excellent educations and life-learning experiences, but if they are not accredited (SACS for example) by the accreditation bodies for that particular area of study, the student may not only have difficulty getting hired, they may find they are unable to pursue a higher degree later because the school they are applying to won't accept the degree they earned. Thorough research is essential in selecting a school - no matter how affordable or what scholarships are offered, if it doesn't have credibility in both the academic world and in the marketplace, it could have very upsetting repercussions for the student's future.
I agree with you regarding escalating costs caused by government intervention. I went to a private engineering college, which was more expensive but closer to 'home' since I was a 'non-traditional' student who was already stable in my community.
Anyway, even the government had their hands into issues at this private school. The biggest example I remember, from years back, is the government subsidies they were going to hold back if the school didn't go fully 'non-smoking', and close all smoking lounges inside. The government always works that way; do this or we won't give you money.
Once again, the discussion gets down to politics. I am not so naiive as to belive I can sway your thinking, but I would encourage you to carefully observe what other countries are doing with universal health care. I think any rational objective comparison on the levels and cost of care in numerous first world countries will show that the US is far behind and far more expensive-countless international comparisons show this. Once everyone is insured, insurers will have more customers (good for business), everyone will be on a level playing field, back-office costs will go way down, etc. It works, the level of service to the consumer is better than in the US (just because hate radio declares that we "have the best health care in the world" doesn't make it so). Ask Switzerland, Germany, Australia.......
I have to question your conclusion regarding the relative merit of our USA based healthcare as compared to other nations. Especially with regard to the western European nations you have listed. The last time I consulted a map, some of the wealthiest scions of the world from the Middle East and Asia seem to be flying over these same nations on their way here.
Granted, the wealthy Canadians (including many in government posts) that choose to simply drive past their own hospitals and over the border, to ours, may simply be looking to save the airfare - but somehow, I don't think so...
Now, is ours more expensive to provide ? Yes. That is, in general, the way of things in life as most folks understand that "you get what you pay for". But, from what I can observe, cost factors do tend to matter less (if at all) when it is ones own health on the line and one has the resources to exercise a choice.
Interestingly, many of these same European nations that you identify as having a lower overall healthcare system cost, also have far lower legal costs and associated insurance costs for their frontline health providers and that is something that I would say merits further discussion...
Student loans are the real culprit in high costs. Once everyone is entitled to a degree (sound a little like housing?), demand goes up and so do costs. If you want to go to college and can't afford it, get a loan or part-time job. If you want to get a loan, that is a private matter between you and your bank. The government needs to get out of the student loan busisness, just like the housing business. My state's schools are $8,655/year in tuition. Anybody could make that with a part-time job. I made $12,000/year in college 25 years ago when tuition was $1,500/year.
Note: I originally said $6,500/year, but that was two-year old data. Being a government worker, since my salary hasn't risen in two years, I expection tuition to remain stagnant. If you live at home and commute like I did (free university shuttle), you have minimal expenses. Of course, at this rate ($1,000+/year increase) when my daughter graduates in 11 years, tuition will be $19,655+/year. I made that much my last year of college 25 years ago, but it is still manageable. Plus, her parents and grandparents will kick into the cost. The point is, get Uncle B.O. out of the picture and universities will drop their tuition or go out of business.
(I also did the math, since I graduated 22 years ago the tuition ratio is 5.77 [8,655/1,500]. I made $32,000 in my first job, so graduating seniors should make $184,640 [5.77*$32,000]. Uncle B.O., will you please raise my GS-13 salary to compensate?)
I do not agree with the president on too many things, but on this subject he is correct. Universities around the country have been on a tuition feeding frenzy for decades. When I graduated in 1979 tuition was around $30 per credit hour (typically 3 - 4 credit hours per quarter per course). Today it is well over $200 per credit hour. In addition the cost of books and other fees have skyrocketed. This was a state university which is partially funded by the taxpayer. Private universities throw the entire cost on the students. Over the years I have noticed that the school that I attended has raised tuition costs an average of around 9% per year with no end in sight. There is absolutely no excuse for the size of these increases. I attribute the increases to government subsidies. The schools simply view this as free money. Well folks the party is over. Schools have had their way for so long that the costs of higher education has become unaffordable to many. It is about time someone stepped in to put a stop to the insanity that has pushed a decent education out of reach.
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