Rising university costs, not falling state aid, is the real reason for lack of affordability

Every year, Michigan universities and other higher education interest groups lobby the Legislature to increase funding for the state’s 15 public colleges. A main talking point is that state cuts to appropriations have led to skyrocketing tuition. But data shows that this is not true: College tuition has skyrocketed way beyond the amount legislators trimmed from universities years ago, and the extra funding given in recent years has done little to relieve these costs for parents and students.

In order to bring tuition to what it was a decade ago, and granting an inflation adjustment, Michigan taxpayers would need to spend $2.8 billion, $1.5 billion more than it currently spends (see chart).

This assumes that schools would use all of these new resources to substantially reduce tuition rates for students, which is highly unlikely given universities’ past behavior.

The reason is because state university costs have substantially increased over the past decade, regardless of how much schools are getting from the state. In 2005-06, public universities collected $4.2 billion in total revenue, of which the state contributed $1.4 billion – or $5 billion in total revenues and $1.7 billion in state appropriations when adjusted for inflation. At that time, the average undergraduate tuition was $6,890.

Today, universities receive $6.2 billion in revenue, of which $1.3 billion comes from state taxpayers. Now the universities charge an average tuition of $11,866. Rising university costs, after adjusting for the number of full-year equivalent students, means that state taxpayers would have to more than double the amount they are spending on universities in order to bring tuition to what it was a decade ago.

In other words, anything less than a massive increase in state subsidies to public universities would have resulted in increased tuition rates for students and parents. Based on this evidence, it’s simply not accurate that rising college costs are driven primarily by reduced state support.

So what is driving tuition hikes? A likely main factor contributing to this phenomenon is the tendency of students to largely ignore costs when choosing a university. There is no incentive for universities to cut costs as long as students are willing to pay higher tuition – and so far, there has been little slowdown in the number of students wanting to attend college, despite it being more expensive than ever.

A reason for the lack of cost consciousness could be that the true costs are largely hidden. Schools have seen a dramatic increase in federal funding in recent years — education tax benefits and Pell grants have more than doubled and student loans have increased by about 75 percent. A recent study from the New York Federal Reserve says this increased federal spending on higher education has increased tuition between 55 and 65 cents for every $1 in federal grants and loans.

Perhaps schools believe all this new spending is justified, but it is hard to argue that students are getting that much better of an education today than they would have a decade ago. Even so, the benefits to students’ academic outcomes are certainly not enough to justify such large increased spending by universities.

And taxpayers get little in return for their spending on these institutions. The traditional justification – that more money results in a more educated state – is incorrect. There is no correlation between how much governments spend on public universities and how many college graduates or degree-holders choose to live in a state. For instance, New Hampshire and Colorado spend the least in the nation on public universities but have far more degree-holders than the average state, while Wyoming, Alaska and Mississippi spend among the most and are home to fewer college graduates than the average state.

Michigan taxpayers have better priorities to spend their money on than the state’s public universities. The amount spent does little to lower tuition or obtain more graduates. Legislators should spend the extra taxpayer money on infrastructure improvements and debt or give it back to taxpayers, who are better suited to find a superior use for the money than are politicians.

Bridge welcomes guest columns from a diverse range of people on issues relating to Michigan and its future. The views and assertions of these writers do not necessarily reflect those of Bridge or The Center for Michigan.

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Comments

EB
Fri, 04/22/2016 - 4:44pm
Since this hit piece is authored by Mackinac Center for Public Policy staff, it has no credibility and I have to wonder why Bridge would even publish their propaganda.
Sat, 04/23/2016 - 2:15pm
Feel free to share an alternative view of the relationship between university costs, state appropriations to universities and tuition.
Mike Reade\
Mon, 04/25/2016 - 10:29am
How about the fact that employers that provide high paying jobs locate in areas that produce a highly skilled workforce: Silicon Valley Boston Austin Charlotte Minneapolis
Art
Sat, 04/23/2016 - 12:42pm
If you think this article is not credible, please submit your financial analysis that proves otherwise.
David Richards
Sun, 04/24/2016 - 6:02pm
Knowing this was a Mackinac Center piece, I knew something was rotten in Denmark. First, the time frame used for comparison begins in 2006, when the auto companies, the economic base of Michigan, were heading toward bankruptcy and we were in what my conservative friends call the "Granholm one-state depression". As commenter Terry points out, based on a more credible state analysis (in my experience, the Mackinac Center people tend to cherry pick and leave out pertinent information), if you start in 2001, there has been a major reduction in state aid and the increase in college tuition has paralleled that reduction. In any event, one thing going on in the background if you are going to consider this issue is the number of students attending college. In the 1960s, when I went to the U of M, the percentage of high school students going to college was much lower than it is today. The percentage going on to college is much higher now because a high school education is insufficient for most jobs in today's world. Thus, even if state support adjusted for inflation stayed the same in recent decades, the increased number of students would dilute the financial support because it would be spread over more students, leaving each one a larger percentage of cost to pay out of their own pocket.
Jarrett Skorup
Sun, 04/24/2016 - 6:22pm
As noted in the piece, it is adjusted for the number of students.
Wayne O'Brien
Sat, 04/23/2016 - 6:07pm
Complexity of content and insufficiently deep and nuanced thinking seem to be missing here. I hope, that for more developed information about these issues, folks who have read this article will more fully inform their thought by Googling the 20 JAN 2016 Empowering Michigan Ninth Annual Economic Impact Report of Michigan's Research Corridor. The whole report is about 80 pages---easily downloaded. Expenditures of taxed resources by state government certainly require open debate. I also hope that the debate about higher education expenditures include still more critical issues. 1. How do faculty demonstrate actual teaching skills? Our friends in Europe have been working for years to make certain that all higher education faculty enter their classrooms each day with not only advanced degrees but also proven teaching skills. The drop out rates cited may be partly attributable to faculty professors' inability to distinguish between merely professing and actually teaching which is much more challenging and difficult. This deficiency could be remedied. 2. Consider looking at the ratio between full time faculty and adjuncts.....the trend does not appear encouraging. How many of those new administrative positions have been created for tutoring needs because the students were insufficiently taught by faculty in their classrooms? 3. Public university costs and financing practices need to be transparent and open to public inspection. 4. The days when universities could offer "weed out" classes are over. All students are to be encouraged to achieve but there are needs for more study-area survey opportunities, work- study opportunities and an over-all "rethink" of what higher education should consist of and how it should be financed in the 21st century. 5. Might the folks who wrote this article from the Mackinac Center partner with the folks at Anderson Economic Group in an effort to provide concerned citizens with a more fully nuanced view of the educational and economic contexts they perceive? Because the views seem to differ quite starkly.......So far policy/opinion and what may be considered research offer a somewhat blurry picture.....maybe by working together these folks could bring greater focus to the issues which might help folks in Michigan navigate and way-find more optimally into the best future posssible.
Terry
Sat, 04/23/2016 - 9:39pm
The authors leave an impression that Michigan’s public universities irresponsibly raised tuition. The non-partisan House Fiscal Agency produces annual reports on the status of higher education in Michigan, and the most recent of these (http://www.house.mi.gov/hfa/PDF/Briefings/Higher_Education_Budget_Briefi... ) is instructive. The Agency reports (page 18) that current higher education appropriations are 41.1% less in inflation adjusted dollars than they were in 2000-01. Public universities increased tuition in the intervening years and we wonder whether these increases were reasonable? One way to answer the question is to track the sum of tuition plus state appropriation per student (more precisely, per fiscal year equated student) over the years. This sum is the lion’s share of what universities use to operate their institutions. So, what is a reasonable operating budget on a per student basis? The Fiscal Agency report (page 39) suggests two benchmarks based on circumstances in 2000-01. One is to inflate the data from 2000-01 using the Michigan CPI and the other is to inflate the same data using the Higher Education Price Index (HEPI). The Fiscal Agency data (page 39) shows that using HEPI the inflation adjusted sum of state appropriations and tuition per student has remained in line with 2000-01. In other words, tuition increases matched the the decline in appropriation, and contrary to the authors’ contention, tuition increases simply maintained the status quo ante.
Sun, 04/24/2016 - 1:01am
How about we use some real numbers like a scientist. One problem with this article is that much spending by the State is related to capital investment in things like new buildings. It does not represent dollars for student's education costs. This tells the reader nothing about the actual funds provided per student to a University towards their education cost. The education cost per student at a typical Michigan public university has only risen at about the average US inflation rate since 1980. Just as the price of food, cars and wages have across our economy. However the percentage of that education cost provided by the state was 16% at my University this year down from about 70% in the early 80s. Want numbers? Read this blog post: http://thesciencerant.blogspot.com/2013/03/hey-america-truth-behind-your...
R.L.
Sun, 04/24/2016 - 6:06am
I started college 50 years ago. Some of my undergraduate courses were taught by Grad. Asst. Some professors taught 12 hours a week and were expected to do research and publish the rest of the time. I could attend college for under $1500 per year and that included room and board. I worked in the paper mill one summer and earned $2.00 per hour. The next summer I joined the Laborers Union and worked 8 months on construction and earned $4.00 per hour. After 7 years of college with a Masters Degree, a Graduate Assistantship, and part time work I owed $1,000 Dollars which I paid off in less than a year. College costs are out of control and debt which many students grads and non grads alike cannot pay back. Even without interest they are not able to pay it back. Please comment. R.L.
Ken Mitton
Sun, 04/24/2016 - 8:57am
You are so correct RL. Here I wrote how those numbers have changed from my first year in 1980 untill now. The cost of our educations increased with US national inflation rate like most items in our economy but the student's share (tuition) and State's share have now shifted to a complete swap. http://thesciencerant.blogspot.com/2013/03/hey-america-truth-behind-your...
Jim H
Sun, 04/24/2016 - 1:44pm
I had almost the same experience. Working a minimum wage job during summers and over Christmas I almost covered the $1,100 or so total cost per year. I suspect the main driver of the phenomenal increase is the intervention of federal loans. With an unending spigot of cash, the universities have lost all interest in belt tightening. If we want to see university education become reasonable again, try a few years of zero government loans. A real come to Jesus moment would be beneficial to university administration.
Scott Brodie
Sun, 04/24/2016 - 7:13am
I agree with the sentiments of EB about the Mac Centr, since it's bias is well known. This study would have been more valid done over say, 30-40 years, during such times when the State more fully subsidized university budgets. Also, how about adjusting all numbers for inflation?
Matt
Sun, 04/24/2016 - 9:05am
So you and EB bring a completely unbiased viewpoint to the conversation? (Sorry, a peeve of mine is the left's insistence that only those on the right are biased and extreme .) BTW the graphs shown are labeled inflation adjusted. I believe that the very limited and uncontroversial point to this piece is that if the state had held revenues constant it still wouldn't have kept up. Very little digging or a short trip around a campus makes this easy to believe. The better question for you and EB is given this desire to keep tuition steady along with all your other wish list items social, environmental, schools along with the roads, rescuing unfunded public pensions, past and future muni bailouts, what is your roadmap? Doubling or tripling state taxes?
Marc
Sun, 04/24/2016 - 11:21am
Progressive tax rate increases and higher taxes on corporate profits would be a good place to start. The 1980-2016 time frame coincides with our policy move away from fair and effective tax policy.
Matt
Sun, 04/24/2016 - 9:56pm
Marc, when you consider the total tax picture (property, income business, sales, fuel) in MI, we're right near the top already, do you think people especially high income/ high tax payers will really just sit still and keep sending their checks? Also the years of paradise you cite - 1980 on saw Michigan's economy stagnate into primarily an auto only situation. With all the skilled workers, manufacturing know how and experience, your explanation for this is that we didn't spend enough for the goodies on your wish list?
Observer
Sun, 04/24/2016 - 2:21pm
As always, Matt is dead on the money. I particularly liked his point about the mismatch between voter's wish list and their willingness to pony up. British economist Paul Ormerod made a similar point about Scottish voters in a recent blog post. He said, "Scotland epitomises the problems which all centre-Left governments face. They want high public spending, but the electorate will not pay the necessary tax.  They cannot finance it by issuing debt for very long.  The only solution is to find a kindly uncle who will pay, in this case the English."
EB
Thu, 04/28/2016 - 3:04pm
Michigan is out of line with more progressive states in several areas. Increased funding for higher education could come from a graduated income tax, reform of our criminal justice system, and taxing the entities that benefit most from highly educated workers, businesses. Although I have no confidence in anything published by the Mackinac Center for Public Policy, we're way overdue on a debate on how to properly fund higher education.
David
Sun, 04/24/2016 - 9:41am
The equation has considerable complexity, especially in Michigan. A few years back the Legislature took $500,000 from the Wayne State University budget and distributed it to other State-supported universities and colleges to show their collective displeasure that WSU had ratified a long-term contract with the AAUP. There was also a threat to take money away from Michigan State University on account of a course in labor relations was to be taught. There is a tendency to regard these issues as 'left' vs. 'right', but this is a meaningless over-simplification. I suspect there is a strong sentiment among certain elements of the political spectrum to keep the populace uninformed.
Jesse Atwell
Sun, 04/24/2016 - 9:47am
Colleges and Universities are simply fleecing the public. Education has deteriorated every year for the last 35 plus years. All one has to do to verify that fact is talk to any college graduate. They can't tell you who fought in the Civil War, nor can they make change without looking at their phone. So what is the answer? I say, stop supporting their laughable increased costs needs and let them float on their own. Time for politicians to hold their feet to the fire and get gov't out of the education business entirely.
R.L.
Sun, 04/24/2016 - 2:19pm
Thanks for the feedback. As long as you keep giving out loans there will continue to be the problems of charging what the traffic will bear. Our buy now pay later has got to slow down. That one trillion plus student loan is not a bubble it is a blimp. Hang on for our politicians to come up with a solution. Peace R.L.
Observer
Sun, 04/24/2016 - 2:46pm
The authors ask, "So what is driving tuition hikes?" Obviously, students believe the education, with its pay premium, is worth the cost. The average student loan debt is around $30,000, which is a good deal if the student has chosen his field of study wisely. And why isn't it appropriate for the student to pay a substantial portion of the cost? After all, they are the ones benefitting from the education. Why should lower income people subsidize the incomes of people who will make well above average salaries?
Diana Menhennick
Sun, 04/24/2016 - 4:36pm
Once again as always the Mackinaw Center for Public Policy quantifies numbers to support their view. The state continues its starve the beast style of policy which is now starting snowball with the Flint Water Crises. The universities don't help matters with upper administrative staff making 3 fiqure salaries similar to the private sector. No one cares about the students!
Sun, 04/24/2016 - 5:27pm
Maybe we should spend more on prisons and less on education or, perhaps, the authors of this piece want to spend very little on higher education. I am a product of A state state university, graduating in the 1960's. In that era, Repulicans and Democrats supported higher education to such an extent, that a student's summer job easily covered tuition. We need to greatly increase the level of subsidization at least equal to what it had been in earlier years.
Tammie
Sun, 04/24/2016 - 6:02pm
If universities operated anything like a sustainable business, they would be affordable. The centralized archaic structure of regents, chancellors, provosts, presidents, executive vice presidents, special assistants to the vice president, college chairs, department chairs, deans, etc. makes the organizational structure so incredibly top heavy, political and bureaucratic that efficiency is all but impossible. Add in the number of new, p.c. and useless classes and degrees taught by people who couldn't get a real job anywhere else, instead of adjunct professors who are working professionals with real world success and experience, and the picture begins to get clearer. It's a very gravied train for the state employees working in higher education and not many of them would ever vote to change it. Most sign on for life and just move around within the system and up the ladder, which is largely internalized through the Chronicle of Higher Ed or state HR management databases. Like most tax funded entities, there is a lot of room for "fat trimming" in public universities.
Dave
Sun, 04/24/2016 - 8:23pm
Education has become kind of like healthcare, if no one shops, they spend the money. We need to increase both funding and accountability. The state funding needs to be tied to the graduation rate, when 40% don't graduate, we need to ask how much we are wasting.
Matt
Sun, 04/24/2016 - 10:16pm
The saddest part of people attending college but dropping out later is that these folks were likely fed the baloney that every student must get a bachelor's degree instead of being introduced in high school to skilled trades that are in so much demand in today's economy. Now they have neither. Granted we're starting to see begrudging acknowledgement of other alternatives but it doesn't take much interpretation skill to gather that these aren't the preferred course.
Terry
Sun, 04/24/2016 - 9:42pm
This discussion is a little like arguing about angels dancing on pinheads. It is true, as several have noted, that the state’s share of public higher education cost has declined from upwards of 60% in the 1980’s to less than 25% today with tuition rising to fill the gap. Could it have been otherwise? The big drops in state spending on higher education are associated with the dot-com and real estate bubbles of 2000 and 2008. State revenues dipped sharply at these times, and either taxes needed to be raised or some state programs needed to be trimmed. Raising taxes at a time of economic stress would likely have made the situation worse, but, and this is the important point, it was not politically possible in any event. Of the possible places to trim, higher education is a natural candidate precisely because tuition can act as a shock absorber. It would take billions of dollars to return the tuition/appropriation balance to what it had been three decades ago, and we could wonder if it is it likely the state will increase higher education spending by billions in the near term? The budget bills are based on a consensus of the House, Senate and Governor’s Office on likely state revenues. The current estimate was published in early February, 2016 (http://www.house.mi.gov/hfa/PDF/Revenue_Forecast/CREC_Final_Recap_Feb16.pdf). Happily, the forecast is for additional state revenues, but, there are not billions to reallocate. The article that kicked of the discussion claims that “Rising university costs, not falling state aid, is the real reason for lack of affordability.” That assertion is wrong. The non-partisan House Fiscal Agency analyzed the data (http://www.house.mi.gov/hfa/PDF/HigherEducation/State_Appropriations_Tui... ), and here is what they found: “If increases in institutional financial aid are subtracted from university operating revenue increases, nearly all the cumulative tuition increases would be attributable to appropriation reductions with the HEPI baseline.”
Mon, 04/25/2016 - 8:50am
That concluding comment underscores that Michigan university costs are increasing commensurately with university costs in other states. Our findings would likely apply in other states as well, given few things are able to keep pace with the drastic rise in university costs. Note that Figure 4 from the HFA paper shows similar data to our chart. We just took it a step forward by calculating how much state appropriations would have been necessary to keep tuition down, something that the HFA paper did not attempt to do.
Terry
Tue, 04/26/2016 - 8:18pm
Note that tuition is not included in the HEPI index. HEPI is not a measure of how much students/parents spend to get a higher education, or how those costs change over time. https://www.commonfund.org/wp-content/uploads/Institute/HEPI/HEPI_2016_T... The index is higher than the CPI, but at 1.6%, 3.0%, 2.1% and 1.3% for 2013, 2014, 2015 and 2016, which appears to be typical, the underlying inflationary costs felt around the country in higher education do not account for tuition increases. As the HFA concludes, the increases trace to reduction in state funding.
John S.
Mon, 04/25/2016 - 12:33am
Perhaps due to rising household incomes student demand for infrastructure and services has gone up. Universities have responded to the increased demand by raising tuition and spending more money so that they can compete with other universities to attract students. What did a dorm room for two look like half a century ago? It was a small room with a bunk bed, two small wooden desks and chairs, and maybe some table lamps. There was a common bathroom with showers shared by 30-40 students down a hallway. There's one television in a recreation room. In the dorm rooms? No internet connection, no tv's, no refrigerators, etc. Maybe one of the students in the room would have a manual typewriter. In the old days there was a gym. Today there's a recreation center. In the old days there was a student center with a bookstore, a television room, mail boxes, vending machines, and a cafeteria. Today there's a fancy student center with food courts, banking, post office, barber/beauty shop, pharmacy, and all kinds of other services. Times change.
abc
Mon, 04/25/2016 - 10:24am
The claim that "There is no incentive for universities to cut costs as long as students are willing to pay higher tuition – and so far, there has been little slowdown in the number of students wanting to attend college, despite it being more expensive than ever." is an absurd over simplification and tells us far more about the ideology of the authors than the state of higher education in Michigan. The true situation is complicated and "marketplace" idolatry tell us nothing. The reasons behind selecting a University, or any other opportunity to add skills, is multifaceted. A cheaper school that does not have the programs needed or which can only offer diminished educational resources is a false economy. Students know that paying less for school means earning less for the rest of their lives. And that is completely irrational.
Mike Reade
Mon, 04/25/2016 - 10:25am
"There is no correlation between how much governments spend on public universities and how many college graduates or degree-holders choose to live in a state." Maybe not, but the Mackinac Center can't argue that employers who bring good jobs (i.e. tech) choose to locate in areas with high quality universities which produce high quality graduates. Silicon Valley, Boston, Austin and Minneapolis are all examples of this. If we continue to discourage higher education in Michigan the next recession will hit this state twice as hard as the last one. Typical shortsighted thinking.
Matt
Mon, 04/25/2016 - 11:05am
Only problem, Mike, is that you can't even correlate state spending on higher Ed with the presence of elite schools that seem to attract businesses in the areas that you reference. For example MA is fairly low in its support and the schools giving this area its status, are in fact private. On the other hand the very highest spending states don't show the effect you are wishing for either.
David Waymire
Mon, 04/25/2016 - 3:35pm
You have to educate the college grads, then keep them here with great cities. We have jobs going begging because too many of our grads want to live in a great downtown or inside-the-city-limits neighborhood, and we don't have enough of those in Michigan. So they go to Chicago, Minneapolis, Austin, New York City, Washington DC, San Francisco, etc. The Mackinac Center for 20 years has been saying if we cut taxes, we will be more prosperous. We cut taxes, and slashed support for universities and cities. And while in 1999 we were in an auto recovery and were in the top 15 in per cap income and unemployment rate (low), today we are in an auto recovery an in the bottom 15 in income and middle of the pack in unemployment rate. We need to invest in our universities and our cities if we are going to become prosperous. Low tax states are low education states are low income states...the one conservatives like to point to is Texas as a success. If success if per cap income below the national average, very high poverty rates, high levels of the uninsured...well, that's not success to me. I'll take Minnesota, high income, low unemployment, low poverty rates, low levels of the uninsured -- and lots of college grads. Minnesota gets there by investing in cities and universities and other public goods that prepare, attract and retain the well educated, and in doing so, provide good jobs for those who choose not to go to college.
Matt
Mon, 04/25/2016 - 7:17pm
Dave, If you Google states with highest support for higher education and look at what you get, you will find that you really don't get any kind evidence to support your contention, it simply is all over the map. No one can say that education isn't important and needs rethinking, but making a broad top down contention that ballooning aid into our existing higher Ed system will automatically lead to wide prosperity... Nah. http://www.pewtrusts.org/en/research-and-analysis/issue-briefs/2015/06/f... Do you really believe that there is a cut and dried, punch list formula that will turn any and every city into a "Cool" city that will turn to magnet for young people? I doubt you do. It's way to organic to work like that. You bring up Minnesota, often, to compare to MI or TX, and that we should follow their model. But you overlook the 100+ year, economic base and culture that is unique to it. (I'd contend that they have a lot of college grads and public infrastructure because of their wealth and culture, not the other way around.) But further, this is like comparing Sweden and Greece, saying the Greeks need to follow the Swedish model. They tried and it didn't work out so well. This thinking ignores subtle and not so subtle differences that make huge differences in results. Thanks.
Wayne O'Brien
Mon, 04/25/2016 - 11:50am
I think that I might rather consider this Mackinac Center article an example of too narrowly focused thinking rather than "short sighted" thought. It lacks the context which might make the points more useful to policy makers of integrity. Good, solid and informed, decision making requires awareness of the big picture as well as analysis of details. Systems theory urges much attention to multiple interconnections before jumping to, or suggesting, cause effect assertions. Hohman and Skorup may feel and express their perceived alarm at what may only "appear" real danger from their more narrowly focused thought/perspective. While examining the broader context of state universities' impact on multiple aspects and dimensions of the state's economy, the Anderson Economic Group (indicated above) provides a substantiated (detailed) portrayal (of some nine consecutive years) of the intricacies of Michigan's economic/educational landscape and demonstrated contributions (compared to other similar states) of especially the research corridor on Michigan's actual functioning larger economy; broadly conceived not narrowly focused; therefore more useful and applicable to sound policy decision making efforts.
Sue
Mon, 04/25/2016 - 2:18pm
The University of Michigan is a great example of losing your way. With the $350 million in research dollars and $1 billion dollar hospital budget, and one of the largest endowments, what is the real benefit financially to undergraduate students? This income, coupled with a rich pool of wealthy out-of-state students, there is not any obligation to take care of Michigan students so they do not leave here in debt, especially those who can least afford it. What is even worse is the lavish meals, first class airfare, etc. by faculty and staff who believe they "deserve it". Just remember, those with a liberal arts degree from the UP are going back home with $25,000 in debt having lived off ramen noodles for 4 years, while you all enjoy your Zingerman's deli tray for the 4th time this week. So, the elite schools are full of rich kids who support rich faculty. Smaller universities need to consolidate--why are there so many?
Linda Brewer
Mon, 04/25/2016 - 7:53pm
I speculate that if loans weren't artificially cheap thanks to federal subsidies then tuition would stabilize and come down. They would have to lower tuition to attract students.
Mon, 04/25/2016 - 8:21pm
...said the boys who earned their post-secondary degrees from private schools.
Jarrett Skorup
Tue, 04/26/2016 - 4:51pm
Yes, for $13,000 per year at the cheapest 4-year college (public or private) in Pennsylvania. And I'm still paying off the loans. I found the degree to be worthwhile. But I didn't try to get taxpayers to pick up the tab.
Matt
Tue, 04/26/2016 - 4:15pm
Another fun little tidbit from the Federal reserve Bank of New York as to the relationship of financial aid to inflation of Higher Ed tuition!! March of 2016. Maybe the State is actually helping control tuition by spending less? https://www.newyorkfed.org/research/staff_reports/sr733.html Of course the Fed is a biased radical rightwing hate group!!!
Larry
Tue, 04/26/2016 - 4:40pm
What the authors are suggesting reflects Libertarian and Tea Party ideology. Alternatively there is another interpretation with considerable evidence discussed in the references cited below. "Starving the beast" is a political strategy employed by American conservatives in order to limit government spending[1][2][3] by cutting taxes in order to deprive the government of revenue in a deliberate effort to force the federal government to reduce spending.” https://en.wikipedia.org/wiki/Starve_the_beast And, this thinking extends beyond the federal government to education in particular. (2016). "Starving The Beast: The Battle to Disrupt and Reform America's Public Universities." http://www.huffingtonpost.com/joseph-a-palermo/starving-the-beast-the-ba... http://freemoviesonline.me/starving-the-beast-the-battle-to-disrupt-and-... It can be argued that Michigan’s infrastructure including education at all levels has declined (see many MI news articles online), but higher education is particularly important for high-tech economic development. Rothwell, D. (2015). Higher education is critical to improving Michigan’s economy." Bridge. http://bridgemi.com/2015/02/higher-education-is-critical-to-improving-mi... I hereby sign off and leave it to these articles to begin to make the case. And guess which politicians are on each side on education and what the longterm goals are.
Terry
Tue, 04/26/2016 - 9:03pm
For those who may still be wondering why tuition at public universities has risen so dramatically, it is instructive to look at the Governor’s proposed 2017 budget: http://www.michigan.gov/documents/snyder/Budget_2017-2018_514137_7.pdf First, the Governor proposes a substantial increase for higher education, but the increase only returns the appropriation to what it had been six years ago! From the budget proposal: “The Executive Budget invests an additional 4.3 percent, or $61.2 million, in state university operations. This increase brings total operating funds for universities to over $1.4 billion and restores aggregate university funding to fiscal year 2011 levels.” Second, the Governor proposes to limit tuition increases, as has been routinely done in recent years. But the limit is exceedingly generous in comparison with inflation. From the budget proposal: “Universities will be required to limit any tuition increases to 4.8 percent or less in order to receive any new performance funding. This cap represents double the level of expected inflation.” Why would a conservative governor propose to a conservative house and senate that universities be allowed to increase tuition by almost 5%? Could it be that our Governor accepts that large tuition increases is the only way universities can manage the 41% CPI adjusted reduction in state funding since 2000?
Jeff
Tue, 04/26/2016 - 9:14pm
To be a bit more balanced, this article should have noted that the legislature appropriated $1.9 billion to higher education in FY 2001 and just $1.5 billion in FY 2016 (http://www.senate.michigan.gov/sfa/Departments/FundHistory/FHhed_web.pdf). If you were to adjust the 2001 state appropriation for inflation it would be about $2.5 billion, which is $1 billion more than the state is spending now. If the state appropriated just what it did in FY 2001 adjusted for inflation, the extra appropriation would come to roughly $4,500 per in-state student at Michigan public universities. That would have certainly helped keep tuition from going up like it has. (student counts can be found here: http://www.senate.michigan.gov/sfa/Departments/DataCharts/DChed_SummaryD...)