Topic: Education and Child Policy

Tipping Credulity on Student Aid

Yesterday, USA Today ran a front page article on the arrival of six-figure student debt, highlighting especially the $116,000 in debt accumulated by a Rutgers University master’s student.

Now, the article didn’t say whether the scholar in question was an in-state student or had been a Rutgers undergraduate, but if both were applicable his would be a Guinness-worthy borrowing feat, especially since the article said that Rutgers paid the young man’s tuition for his final year of grad school.

Let’s go to the numbers: In the 2005-06 academic year, the cost of tuition, fees, room and board for an in-state undergraduate at Rutgers was $17,800. If the student had paid that for four years—which he obviously didn’t since he must have graduated before 2005-06—his entire undergraduate education would only have cost $71,200. As a graduate student, if we assume he lived in university housing and had the biggest possible meal plan, he would have paid about $20,000 a year. The grand total for both his undergraduate and graduate education, then, would have come to approximately $111,200—$4,800 less than his total accumulated debt! Oh yeah, and Rutgers paid the young man’s tuition in his final year—about $10,000—so he actually owes $14,800 more than the entire cost of his education. Amazing!

Asserting that students have no option but to go into six-figure hock to attend college is, of course, ridiculous. But, predictably, that hasn’t stopped student advocates and interest groups from celebrating USA Today’s story. Indeed, Anya Kamenetz, author of Generation Debt, even dubbed the article a “tipping point” in the battle to convince America that its students are impoverished and need more taxpayer-funded student aid. Sadly, when it comes to her assessment of the article, Kamenetz might be right.

SC in SC

South Carolinians go the polls today to vote in primaries and for several state office holders, and the future of school choice in the state could be substantially affected by the results. The position of state superintendent is up for grabs, with both pro- and anti-market candidates. There are also several legislative primary races in which incumbent foes of parental choice are being challenged by pro-choice candidates.

Stay tuned for an update tomorrow.

Florida Lacks Hobgoblins

In his recent contribution to Cato Unbound, creativity guru Richard Florida argues that continued economic growth will depend on “regional, national, and global efforts to harness the creativity of each and every human being.” Fair enough. What, then, is his education policy prescription for attaining that goal? He doesn’t say –- at least, not in the aforementioned posting.

Looking for an answer, I turned to Florida’s other writings, browsing them for references to “education” and “schools.”

This search quickly revealed that Florida places great emphasis on improving our education system. “What we really need in order to prepare our children for the creative economy,” he exhorts, “is a comprehensive education, something that takes them from aesthetics to algebra without pretending that the two are mutually exclusive” (Flight of the Creative Class, 2005, p. 255). He adds, “As society diversifies and specializes, more and more different kinds of education and teaching styles must be made available.”

So increased educational diversity appears to be the order of the day. Or does it?

Writing in Washington Monthly in 2003, Florida conspiratorially confides that “no one wants to admit this openly, but we’re already headed toward effective federal government takeover of troubled public schools…. Only a national strategy can repair the now broken connection between good local schools and regional prosperity.”

Increased educational diversity through more pervasive central planning? Alas, the cognitive dissonance is only beginning.

Florida’s next education policy prescription is higher spending. To make his point, he trots out the embarrassing jade that “it will be a strange day when our schools get all the billions they need and the army has to hold a bake sale to fund its bombers.” To drive the point home, he characterizes current U.S. public school spending as “paltry sums of money” (Flight, p. 255).

As Florida surely must know, total U.S. public school spending now stands at roughly one half of one trillion dollars a year. Annual per-pupil spending is roughly $10,000. That is a quarter of a million dollars for every classroom of 25 students.

The only nation on Earth currently spending more per pupil at the K-12 level is Switzerland. The Netherlands, which routinely trounces the U.S. on international tests of academic achievement, spends $4,000 less per pupil annually.

Having laid waste to his credibility with the trivially falsifiable claim of underfunding, Florida immediately downplays his own argument. A mere three pages after throwing money and slogans at the problem, he explains that “throwing more money and slogans at the problem will only get us so far” (Flight, p. 258).

If consistency is the hobgoblin of little minds, the mind of Richard Florida is a vast hobgoblin-free zone.

Whatever the merits of his claim that the presence of creative bohemians causes economic growth, Florida does not seem to have a coherent education policy for promoting creativity or, for that matter, anything else.

Many Variables, One College Problem

Over at the American Prospect, Matthew Yglesias raises a question from my blog entry yesterday in which I pointed out that college tuition is rising astronomically in large part because government provides the money to pay it. Yglesias points to my observation that over the last 10 years, aid per-student has actually grown faster than costs. He suggests that aid is therefore likely doing its job, making college more affordable by bringing aid closer to the cost of tuition.

Yglesias reaches a reasonable conclusion, but he takes one observation I made and leaps far beyond what can be surmised from it.

There are many factors that affect tuition prices, ranging from the cost of energy to rising and falling state aid to public colleges. These variables could certainly affect whether aid grows faster than college costs or vice versa in any given period. In the long term, though, it is clear that, as per-student aid has risen, tuition too has gone up, both at rates far exceeding normal inflation.

Suppose, though, Yglesias is right and aid does eventually match costs. At the rate we’re going, would anyone want to pay the tuition bills taxpayers will be forced to fund if and when that happens? I sure wouldn’t.

Journal of Inflation

It’s not the highest profile issue, but every once in a while one hears rumblings from the Ivory Tower about the exorbitant cost of academic journals.

There are, it seems, roughly a billion of these journals, and each one deals with its own microscopically narrow subject, from the Journal of Contaminant Hydrology to Husserl Studies.

According to an article in today’s Contra Costa Times, the University of California system alone spends tens of millions of dollars on such journals every year, and each year colleges get a little grumpier about the journals’ rising prices.

To combat subscription price inflation, colleges and universities are pushing for journals to switch from traditional paper to less expensive electronic formats, which is all well and good as far as it goes. It won’t, though, stop inflation in the long run; just as I wrote about tuition yesterday, journal prices skyrocket because publishers know that someone will pay for them. And who would that “someone” be? Taxpayers!

Just look at the inflation in taxpayer support for higher education over roughly the last decade, and it is abundantly clear who’s paying the bills. According to the College Board, the total amount of inflation-adjusted student aid provided through state and federal programs doubled between the 1994-95 academic year and the 2004-05 academic year, rising from $48.0 billion to $96.4 billion. In addition, the latest figures from the Digest of Education Statistics, when adjusted for inflation, show that total federal, state, and local appropriations to public colleges and universities rose from roughly $54.5 billion in 1995-96 to $69.1 billion in 2000-01, a 26 percent jump.

After seeing those figures, one doesn’t need to read an obscure publication about economics to understand why academic journals cost so much.

In Higher Education, Status Quo Is Status Quo

Yesterday, a House subcommittee working on the higher education portion of the 2007 federal budget approved a bill that would add $100 to the maximum Pell grant, bringing the ceiling to $4,150, and save numerous programs President Bush had slated for elimination. According to Inside Higher Ed, committee Democrats were on the warpath from the start, demanding more support for the nation’s college students:

After a few minutes of civility, House Democrats went on the attack, questioning their Republican counterparts’ commitment to helping working-class Americans afford college education.

“Here’s the story as I see it: Families spend more to send their children to college; their costs are not frozen,” said Rep. David Obey (D-Wis.)… “We’re not going to effectively deal with this by keeping the status quo. And this bill is worse than that. People who are supposed to be the focus wind up getting squeezed.”

Obey was right—keeping the status quo is not going to ground higher education’s skyrocketing price. But the problem is that the federal government is putting too much money into student aid, not too little! The political cycle that drives tuition is actually easy to understand: Some people complain that tuition is too high and demand that politicians make college “affordable.” Politicians, to get votes, provide student aid. Then schools, suddenly able to get more money, raise tuition. But wait, that makes college “unaffordable” again! And so it goes…

The data bear out that increases in student aid have driven tuition up. Indeed, aid has actually been increasing faster than tuition over the last ten years. According to College Board figures, between the 1995-96 and 2005-06 academic years, the average, inflation-adjusted, enrollment-weighted, cost of tuition, fees, room, and board rose 31 percent at private, four-year institutions, and 41 percent at public, four-year schools. Meanwhile, inflation-adjusted aid per full-time equivalent student – most of which came from the federal government—rose 61 percent, from $6,261 to $10,119! Tuition ballooned because politicians made sure it could… and then some!

To truly change the status quo, Congress will have to do the exact opposite of what Rep. Obey wants. It will have to cut student aid, not increase it. Unfortunately, that’s not what gets votes.

Common Sense in California

In a referendum, California voters have a rejected a scheme (Proposition 82) supported by the state teachers’ union to impose a special 1.7 percent tax on high-income individuals to fund a government preschool program. A dangerous precedent could have been set here—that a government-dependent special interest could rabble-rouse a majority into the economic persecution of a minority for narrow gain. California voters soundly rejected the plan 59-41 in early returns.