Commentary

Every University a Junkie

For a junkie, a “crisis” is being un able to get the drugs he craves. American higher education is just such a junkie - with the federal government acting as the enabler who gives him another fix, rather than pointing him toward rehab.

In its latest beg for a fix, Higher Ed cries that the credit crunch will make it harder for students to get loans. Last week, Education Secretary Margaret Spellings rushed in to enable the junkies - announcing that, if needed to keep aid flowing, her department will buy loans and forward federal money to guaranty agencies to ensure that every eligible student gets as much aid as possible.

The Ivory Tower is addicted to taxpayer cash, and Washington is happy to keep the junkie hooked. ”

Spellings got the go-ahead to keep the aid flow going back in May. In the same law, Congress (responding to Ivory Tower panic) raised the limits on some federal loans and made it easier for parents with bad credit to borrow from Washington.

This is just the latest chapter in Higher Ed’s government dependency.

A college can only charge as much as students are willing and able to pay. In recent decades, though, federal (and some state) lawmakers have forked over ever-more money to student aid - enabling colleges to charge exorbitant prices.

Consider the per-pupil cost of tuition, fees, room and board, as tracked by the College Board. At private US four-year institutions, the “price” of college rose to an average of $30,367 for the 2006-07 school year - up 208 percent over the last two decades. At public four-year institutions, the rise was almost 216 percent.

Overall inflation in that period? Consumer prices rose about 84 percent. It’s clear that Higher Ed’s got a big problem.

How do we know the problem isn’t just that colleges’ own expenses are rising?

Consider two costs - energy and staff.

Energy costs have ballooned nationwide - but they’ve risen faster on campus. A recent Forbes analysis found that the cost of “heating, cooling and powering” colleges rose 124 percent between 1983 and 2007, while businesses saw only a 60 percent rise. Our colleges and universities plainly haven’t felt the same pressures to achieve energy efficiency.

And, in an era when the private sector has been pruning management fat, Higher Ed’s been adding it: Federal education statistics show that the number of campus executives and administrators per hundred students grew by more than a fifth from 1976 to 2005.

In other words, colleges and universities have been able to raise prices with impunity - and even add to their fat - because government’s ensured that students can pay.

It’s a vicious cycle: Parents and students complain that the cost of college is too high. Politicians, seeking votes, boost aid. Colleges, competing for better-heeled students, offer nicer amenities and charge higher tuition. Parents and students complain again - and the addiction deepens.

The only people with the power to force Higher Ed into rehab are the politicians, who could slow down aid and get the Ivory Tower on the road to recovery. But few pols are willing to engage in “tough love.”

Indeed, the credit crunch offered politicians built-in cover to begin weaning Higher Ed off of easy money - by claiming that bigger problems forced their hands. Instead, they once again increased the flow of taxpayer dollars.

There’s no other conclusion: The Ivory Tower is addicted to taxpayer cash, and Washington is happy to keep the junkie hooked.

Neal McCluskey is associate director of the Cato Institute’s Center for Educational Freedom and author of Feds in the Classroom: How Big Government Corrupts, Cripples, and Compromises American Education.