They’re responding to the claim that “the price has gone up because students are responsible for more of the cost“ which is in the post above them. If the true cause of the increase was a drop in state funding, you’d expect other schools to not change in price very much.
The rise in prices has largely been driven by schools going on real estate binges and bloating administrations.
Right before I graduated, my school decided to build a new football stadium, because they decided using the city's stadium wasn't attractive enough for students. They promised tuition wouldn't be used to pay for it, and it wasn't. We just got something like $500 added to student "fees" instead.
I have no sympathy for universities and colleges in the US, only for the students who were duped into thinking they didn't have another choice.
The claim in the article is unfounded. Prices have increased due to states cutting way back on funding, because of easy of getting loans (just one prong of the problem), need to have a college degree just to get your foot in the door (demand), and mismanagement by school management to build facilities students can't afford.
But that’s not the real problem. The real problem is that the legitimate schools have been able to raise their prices tremendously because the students have all this easy money given to them for just that purpose.
The schools are also making a money grab due to the availability of money. The university I am enrolled in said they will have to raise tuition "drastically" because the state will only give them $125mil vs. $150mil due to cuts. I checked average salary of administration positions, 130k in 2006 and 230k in 2010. Also, they have built two buildings last year and have two more going up this year. Obviously, nothing can be done but hiking tuition.
Without any kind of price control or accountability on the cost of the education, that's just cutting out the middle man in the cash flow problem. Sure no one will have student loans, but taxes will have to be raised to make up the difference.
As the article points out, all those new buildings they're always building aren't free and the posh dorms are unnecessary. But everyone is paying for them anyway, because why not?
That's actually the exact opposite of what the article said:
Our story of rising cost is devoid of bad people making bad decisions. This means that there are no simple fixes, like price controls, that would not also reduce the quality of the education we offer.
Actually, the price increases are most likely not caused simply by the availability of loans.
In the case of public schools, the evisceration of public subsidies has left them operating as public schools in name only. Even in my very liberal state, state support for colleges and universities was cut in half as a share of budgets over two decades. Most states fared worse. At the same time, medical insurance costs for faculty and staff have been increasing by ten percent per year on average, causing this expense to crowd out other necessary costs.
In the case of private schools, the rising cost of public schools has contributed at least as much to their ability to charge more. For profit schools seem to be able to get away with ridiculous claims, leaving graduates jobless and defaulting on large loans. However, they would not be able to justify their prices if public schools were too much cheaper.
Interesting that you want blame everything except the actual major source of expanding costs at colleges: an explosion in the number of administrators and administrative departments. Rising tuition is being spent on bringing more and more aspects of students' lives under the control of college administrators. Scandalously, almost none of the new money has gone to hiring more professors. Something is rotten in the state of higher education and it's the bureaucrats running the colleges, set free from financial reality by heavily-subsidized student loans.
This article hints at schools inability to justify their ever increasing prices. Why is tuition continuing to rise so much faster than inflation? Is this simple supply and demand? Government backed loans create infinite supply to anyone who wants them? How can not for profit schools justify gauging their students?
Salaries are the primary cost not health insurance. There are more administrators than students. Also there is no excuse, the educational institutions are incompetent at managing their finances.
I think the article misses the root cause here. Drastically increased availability of loan-based financial aid means far more more money in the system, which means the prices go up.
The article nails the cause of more administrators--the schools have more money to spend and need to spend it--but completely misses the reason schools are able to charge so much more these days.
I don't know that you can pin this solely on universities. Simple supply and demand states that they'll keep raising rates until the market stops following them.
Each group has a hand in this mess, including the students themselves. Pointing to only one group suggests that we can find a solution there. I really don't think that's the case with this problem.
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