Tag: higher education

Dear Bill: Why the Distinction Between College and K-12?

At the Techonomy conference last week, Bill Gates declared that going to school would soon be obsolete, and that ”five years from now, on the web, for free, you’ll be able to find the best lectures in the world.” What’s interesting is that Bill was quick to note that he was talking only of higher education. K-12 education should still be tied to physical schools, he is reported to have added.

Certainly there’s a custodial aspect to the education of young children, but there’s no reason that electronic learning options cannot be combined with custodial supervision – and much more affordably than traditional schooling. Homeschooling already consists of hybrids of parent lessons, lessons taught by paid tutors and guest lecturers, web classes, etc. This flexible format could be generalized to serve a much broader range of students. So why not encourage the exploration of these new possibilities at the k-12 level, just as at the higher education level?

What Part of “Nonrepresentative” Don’t Profit-Haters Get?

For the last few days, for-profit colleges and universities have been suffering an even worse hammering than usual, both in the media and their pocketbooks. The proximate cause: a GAO report released Wednesday that has been portrayed as revealing “systemic” and “pervasive” fraud — and otherwise just seamy behavior — by the for-profit sector.

No doubt there is some bad stuff going on in proprietary postsecondary education. But the assault on for-profits reeks of political bullying of the unpopular kid — the kid who’s just different — as well as the never-ending Washington demonization of anyone who honestly pursues a profit. The waving of the bloody GAO report is case-in-point, and one need look no further than the following statement contained on the report’s very first page:

Results of the undercover tests and tuition comparisons cannot be projected to all for-profit colleges.

You mean, GAO investigators went to 15 non-randomly selected schools in six states and Washington, DC, and the results cannot be construed to be representative of the whole sector? And the GAO also, apparently, meant it when it wrote on page two of the report that “we investigated a nonrepresentative selection” of schools? But, then, how could Tom Harkin (D-IA), chair of the Senate Health, Education, Labor and Pensions Committee, have stated in a show-trial hearing that “GAO’s findings make it disturbingly clear that abuses in for-profit recruiting are not limited to a few rogue recruiters or even a few schools with lax oversight”?

Oh, right: Truth doesn’t matter to Harkin — only scoring political points. That not only explains how Harkin could say such a thing, but why he has targeted for-profits rather than seeking truth and purity in all sectors of higher education, including the coolest of the cool kids, public colleges. With dismal program completion rates of their own, and their imposition of huge burdens on taxpayers, you’d think they’d be worth some investigating, too.

I encourage you to read the GAO report, and you’ll see that it in no way supports a blanket condemnation of for-profit higher ed. And it’s not just because its findings can in no reasonable way be extrapolated to the whole of proprietary schooling. It’s also because many of the supposedly terrible things it discovers, while perhaps distasteful, are hardly abhorent, such as telling prospective students that they ”can” — not “will” — earn a lot of money in a profession even if that amount is well above the average. And then there’s the report’s worthless comparisons of tuition at for-profit and nearby public instituions. Once again: public colleges are heavily subsidized by taxpayers, so of course their tuition is lower. And these comparisons were also not randomly selected.

After you’ve read the GAO report, you should take in a new paper from the Center for College Affordability and Productivity, For-Profit Higher Education: Growth, Innovation and Regulation. It might be a bit too fond of the for-profit sector, which like all of higher education lives far too much off the sweat of taxpayers, but it furnishes lots of terrific data and insights about proprietary higher ed to balance out the ongoing truth-eschewing assaults the sector keeps on suffering.  

Having Public Colleges Means Limiting Freedom

While we’re all shooting off our guns in celebration of good Supreme Court news, Roger has reported the blow to liberty dealt by the Court’s lower-profile CLS v. Martinez decision. I won’t elaborate on whether the Court made the right decision – on that I stand with Roger (and Alito, Roberts, Scalia, and Thomas). I just want to add one thing about the root problem in the CLS case: You can’t have both taxpayer funding of higher education and full freedom. As Ilya Shapiro and I wrote in an April op-ed about the case:

It is impossible to reconcile free speech with governmentally compelled support of speech. Just as public colleges cannot choose both which student groups to fund and avoid discrimination, they cannot pay a professor without privileging his speech over that of the taxpayers who pay his bills.

Quite simply, when public universities decide which groups do or do not get taxpayer funds, and which professors are or are not hired, government is deciding those things, and that is ultimately incompatible with both free inquiry and, more importantly, a free society.

Our Little Scholars

As I mentioned a few days ago, today is the “Day of Action” in California – and, it turns out, elsewhere – when college students and just general protectors of public schooling are supposed to take to the streets and demand that taxpayers fork over not one less red cent to students and schools.

Ironically, the mindless, property-destroying, absurd goings-on that have surrounded past such demonstrations in Cali – and are already in evidence today – brilliantly illustrate one major reason we need to cut higher education subsidies, not increase them. Clearly, too many college students have both far too much time on their hands, and far too little self control, to justify spending hard-earned taxpayer dough on their “education.”

But at least the ostensible motivation behind recreational rioting in California has been slightly related to a principle – namely, the principle that taxpayers owe students stuff. That’s actually a better excuse for taking to the streets than what set off last night’s student riots in College Park, Maryland: a victory in a basketball game. (To be fair, University of Maryland students also riot after losses – they’re no fair weather fans!)

And to think – one of the reasons we’re supposed to support massive subsidies for students is that it serves the common good. Go figure.

Obama Ringing the Pell

As part of his ill-considered credentialing-to-compete initiative, President Obama wants to greatly increase both the size and availablity of Pell Grants. Under his proposed FY 2011 budget, the total pot of Pell aid would rise from $28.2 billion in 2009 to $34.8 billion in 2011; the maximum award would go from $5,350 to $5,710; and the number of students served would rise by around 1 million.  

A critical question, of course, is whether increasing Pell will ultimately make college more affordable or self-defeatingly fuel further tuition inflation. The New York Times took that up in yesterday’s Room for Debate blog.

Economist Richard Vedder has long educated people about the inflationary effect of student aid, and does so again with great clarity. It’s higher-ed analyst Art Hauptman, however, whom I think best captures what likely occurs when Pell is combined with all the cheap loans and other aid furnished by Washington, states, and schools themselves:

The degree to which student aid affects what colleges and universities charge varies between the Pell Grant and student loans. The Pell Grant has not had much effect on tuition levels in part because the amount of the awards does not vary with where a student enrolls. Institutions cannot affect how much a student receives, and the institutions that charge the most enroll the fewest Pell Grant recipients.

By contrast…there are several good reasons to believe that student loans have been a factor in the rising cost of a college education. Tuition has increased by twice the inflation rate for the past three decades while annual loan volume has increased tenfold in constant dollars.

Unlike Pell Grants…colleges have some control over how much students borrow as loan amounts. Moreover, just as one couldn’t imagine house prices being as high as they now are if mortgage financing were not available, it is difficult to believe that colleges and universities could have increased their charges so rapidly over time without the ready availability of students’ ability to borrow.

[W]e should worry…that increases in Pell Grants may lead institutions to reduce the amount of discounts they would otherwise have provided to the recipients, who are from poor families, and move the aid these students would have received to others. This possibility…is supported by the data showing that public and private institutions are now more likely to provide more aid to more middle-income students than low-income students.

So what’s likely going on? Cheap federal loans – which are available to students of all income levels and vary according to a college’s price – are probably the main direct tuition inflator. More indirectly, Pell probably encourages schools to move other aid from poorer to wealthier students, enabling the latter to pay ever-higher “sticker” prices. In other words, student aid powers tuition inflation!

Which brings me to a quick comment about the submission from College Board economist Sandy Baum, who trots out the standard “declining state appropriations”  to explain our college-price pain.

How many more times do I need to disprove this? Apparently, at least once more:

(Source: State Higher Education Executive Officers)

Public funding is a roller coaster and tuition revenue an incline. Over the last quarter century, per-pupil state and local funding for public colleges and universities went up and down, but dropped overall by a mere $8 per year. In contrast, public colleges’ per-pupil revenue from tuition (net of state and local student aid) rose more or less unabated, growing by about $73 per year. 

This – as well as the fact that private colleges are also guilty of huge price inflation – clearly belies the notion that colleges raise prices because skinflinty governments make them. That might be part of the explanation, but an even bigger part is almost certainly that colleges raise prices because, thanks to ever-growing student aid, they can.

California Grubbing

Kids often have a tremendous sense of entitlement. Well, there are a lot of kids in California colleges — and running them.

You probably have heard about the University of California Regents voting yesterday for a 32-percent tuition hike over the next two years. Not surprisingly, many students are angry, some enough that they were arrested protesting outside the Regents’ meeting.

Now, a 32 percent hike over two years isn’t small. But here’s the thing: California has typically charged students very little relative to both state taxpayer funding and national averages. As you can see in the chart below, which uses data from the State Higher Education Executive Officers, net per-pupil tuition revenue (meaning revenue from tuition minus any state financial aid) in California has hovered around $1,200 over the last 25 years, and has only gone up about $18 per year. Meanwhile, state taxpayers have been shelling out around $7,300 per pupil per year. So state taxpayers have been furnishing the vast majority of funding for California college students, and students have done very little to make up the vast gulf between what they pay and what taxpayers shell out.

How does California compare to the rest of the nation? On average for all states, net per-pupil revenue from students has risen from just about $2,000 to $4,000, putting the ever-growing average around $3,000, or close to three times what Golden State students have been furnishing. Funding from state and local taxpayers, meanwhile, has been just slightly lower nationally than in California.

So California students have been getting a heck of a deal, which is no doubt one among many reasons the state is on fiscal life support. Sooner or later bills come due, and that has left the state little choice but to make students pay more for the education of which they are by far the biggest beneficiaries.

Naturally — but still shamelessly — students are acting like victims now that the decrepit gravy train is slowing down a bit.  Unfortunately, the adults in charge of California colleges are also naturally — but perhaps even more shamelessly — stoking student anger so that they don’t have to do things that make their jobs less pleasant.

Despite the utterly unsustainable taxpayer funding for higher education that California has doled out for decades, for instance, UC president Mark Yudof had no qualms about declaring that:

We’re being forced to impose a user tax on our students and their families. This is a tax necessary because our political leaders have failed to adequately fund public higher education.

Last I checked, what a customer pays for a service is called a “price” not a “tax.” A tax is what has been used to make taxpayers bear by far the biggest part of California’s higher education burden while students have furnished but a token amount. And please don’t give us the “failed to adequately fund” line. UC Berkeley Chancellor Robert Birgeneau has been happily trotting out that disproven dreck in a grab for federal taxpayer dollars at the same time it has been discovered that he’s been pushing millions of dollars intended for academics and other purposes to Berkeley athletics.

It’s hard enough to accept the underfunding bit when the data clearly show it not to be the case. It’s even harder when college leaders spend their precious dollars on water polo and golf.

It’s time in California for the adults to stop acting like kids, and for the kids to start paying their share. But don’t get your hopes up, at least in higher education. It seems that no one there is without a shameless sense of entitlement.

Degree Disaster Behind The Great Wall

Based on my regular reading on education, but not China specifically, I know that the world’s most populous nation has had a lot of trouble finding jobs for its throngs of recent college graduates. I wrote a bit about that yesterday, pointing out that the important higher education lesson from China is that pumping out more college grads is meaningless if they don’t have skills that are in demand. Well, thanks to a very helpful Cato@Liberty reader who actually lives in China (and wishes to remain anonymous) I now have a much better idea just how important that lesson is. He directed me to this Asia Times article that includes, among many fascinating tidbits, this startling revelation:

An explosive report released by the Chinese Academy of Social Sciences (CASS) in September said earnings of graduates were now at par and even lower than those of migrant laborers [italics added].

Wow! If this report is accurate, until now I have had no idea how truly ridiculous Washington’s obsession with pumping out more degrees to keep up with the Chinese has been – and I’ve been pretty sure it’s ridiculous! Much more troubling, if I’ve had little clue about the true extent of the absurdity, imagine how far from grasping it our government-loving federal politicians have been! Of course, as I wrote yesterday, even if they did know it, they probably wouldn’t let on.