Sunday, February 12, 2012

Reining In College Tuition

-A good NYT editorial:


February 3, 2012

Reining In College Tuition

Higher education institutions are predictably cool to President Obama's proposal to shift federal aid away from colleges that fail to control rising tuition. Even though the details of his plan, which would require Congressional approval, will not be fleshed out until later this month, the idea behind it is sound.

The federal government must do more to rein in tuition costs at the public colleges that educate more than 70 percent of the nation's students. By one estimate, the cost of four-year public college tuition has tripled since the 1980s, outpacing both inflation and family income. The increase in the tuition burden is largely caused by declining state support for higher education in the past three decades. In both good times and bad, state governments have pushed more of the costs onto students, forcing many to take out big loans or be priced out of once affordable public colleges at a time when a college education is critical in the new economy.

While financial aid is available to some low-income students, many are driven away by tuition sticker shock. At the same time, many colleges have failed to find more cost-effective ways to deliver education and get the average student to graduation in four years. President Obama was on the mark when he said that this needs to change.

A smart analysis by State Higher Education Executive Officers, a nonprofit group, shows clearly what has happened in public higher education since 1985. In Michigan, for example, the net tuition paid per student (after financial aid) rose from about $3,900 in 1985 to nearly $9,000 in 2010, in inflation adjusted dollars. A similar jump occurred in Pennsylvania, where net tuition per student has gone from about $4,500 in 1985 to more than $8,800 in 2010. In response, students have turned to loans. In the last decade, federal college loan debt has more than doubled from $41 billion to $103 billion, according to the College Board.

President Obama's proposed reform plan would require colleges that receive federal aid to create "a scoreboard" that gives actual costs, graduation rates and potential earnings for graduates. His idea for establishing a $1 billion fund to provide grants to states that improve graduation rates and reduce costs is a good one. He also calls for expanding campus-based aid — mainly loans and work-study programs — to more than $10 billion from the current $2.7 billion. And, for the first time, the government would punish colleges that failed to control tuition or that did not provide good value by shifting money to other schools that do a better job.

Determining what amounts to good value will be difficult, and persuading Congress to move forward on any of these ideas will be hard. But Mr. Obama is right that the federal government should begin leveraging its sizable investment in higher education for reform. He has set the stage for a long overdue discussion about what ails higher education and what might be done about it.

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