Okay, let's to get to the bottom of this. Why are college costs so high in the US compared to every other country?
I've been reading about it and it is NOT because the US government spends less on university subsidies compared to European nations. It actually spends way more, and has actually been INCREASING spending on higher education at almost five time the rate of military spending since the 1960's.
So obviously the reason is that colleges are incurring more costs, requiring higher spending in the first place. But what is accounting for such an increase in operating costs for colleges since the 1960's? They had all the same shit back then, football programs, campus housing, rec centers, etc. Sure there are most students but this can't possibly account for it all, because that also means more money coming in. Just what is going on here?
Loans in the 10's of thousands of dollars are guaranteed to kids fresh out of high school with no concept of money.
They charge insane tuition rates because, well, they'll get it. It's that simple really.
Sure, whatever the tuition is people are gonna have to pay it, since it is still a good investment. But I don't think this is a matter of "we can raise the price, so let's do it". Colleges are not simply making much more in profits than they were before. They just have higher operating costs. What I want to know is what accounting for this?
>I don't think this is a matter of "we can raise the price, so let's do it"
It absolutely is. I have a good friend who's a college professor. I just did has taxes for him. He made near minimum wage after all was factored out. It's ridiculous.
If your friend is a part time or adjunct professor then yeah this is to be expected, they pay these professors shit...load them up on classes but make their hours just under full time so that they provide any benefits. But all this means is that costs are not increasing on that front. We are still left with the question "why are operating costs so much higher?" If they were just increasing tuition without an increase in costs, then colleges would be more profitable than they used to be. But they are NOT more profitable, many are actually losing money. So what is accounting for all this extra expenditure?
That is true, but isn't this a worldwide phenomenon? College tuition in the US has been increasing at a much higher rate than both the number of people entering college and the tuition rates of other countries.
Tuition increases parallel the increase in college administrator salaries. Some study got posted on /biz/ the other day that showed that college administration salaries increased by something like 300%, while non-tenured professor salaries have stayed mostly the same.
The president of my college makes as much as an NBA coach, and while I do love my school, they've raised tuition costs for the past 4 years in a row under the guise of 'student experience', when they were really just riding our recent top 20 academic rating and our football team.
I have a lot of loans, but for me, it comes down to the opportunity cost of the loans. Do I want to get a lucrative degree at a good college that I love being at, or do I want to live at home with my parents and attend a community college and hate my fucking life. If I didn't make my own life, and find my own successes where I am now, I would 100% still being sitting at home playing video games and jacking off into my fleshlight.
The government should make the money they give to universities contingent upon not needlessly increasing administrative salaries or adding more administration. I guess this would be hard to do, but if what you are saying is true, then it is pretty god damned ridiculous that increase in administrative salaries is accounting for such a high rate of inflation of tuition costs.
I completely understand and I'm not trying to be insulting. Just pointing out a clear fact that contributes largely to the problem. Outside of that yeah, college (tuition) is a necessary evil in the world today unless you want to work at McDonalds.
I disagree on the pedigree part. Unless you're going for a meme investment banker job it's really, really over-rated once you're out in the job market. They have been numerous studies and news articles on the subject.
Lots of reasons. Some of which have been touched on.
At its core, I think the reality is the further we distance ourselves from the act of paying for something the harder it gets, on the whole, to keep the expenses in control. It's true with insurance/ medicine, it's true with credit card debt, it's true for college/student loan, and it's true for group based spending ( governemnt, spending in corporate enviroment, ect)
That accounts for why demand is higher but not for why operating costs are higher. If demand was higher, all else equal, costs would increase and colleges would be making more profits, but they are not.
This article gives a fairly clear explanation why.
Remove the period before the first w. The loans are a reason. But lack of compensation for colleges is not a reason, as they're being compensated more than ever. Administration has grown exponentially at universities across the country. It's a damn shame.
I'm just curious as to what colleges are not making more money? Small colleges, for profit, new, old, shitty, what?
I went to UT Austin and our school constantly has between $25 - $100 million of construction going on and is still extremely profitable. Standard in state tuition is $4500/semester over 12 hours credit.
I paid it, had saved a lot. Had $1000 of debt after I got it from 2 years of junior college as well.
>At its core, I think the reality is the further we distance ourselves from the act of paying for something the harder it gets, on the whole, to keep the expenses in control. It's true with insurance/ medicine, it's true with credit card debt, it's true for college/student loan, and it's true for group based spending ( governemnt, spending in corporate enviroment, ect)
The problem is when the people making spending decisions are spending other peoples' money. Nobody gives a shit about other peoples' money. Nobody.
See where that chart starts?
At the same time the Department of Education was founded.
FAFSA literally allows schools to charge exactly what each student can pay. They've managed complete and government-endorsed price discrimination.
>Supply remains the same.
False. Supply has also skyrocketed. It should at least offset the issue a bit if this came down to supply and demand.
Also, don't forget about the rise of for-profit online scam colleges. They really drive up the average.
UT's out of state are exorbitant, Ivy League level, and the nationally popular sports teams (mainly football) brings in boku bucks. You have your own cable TV station just for sports.
It's more of a people are willing to pay that much kind of thing. Guaranteed tuition and all the propaganda and pressure from parents that "college or work at mcdonalds" doesn't help either
Now people out of high school feel pressured to take a program they don't even like to make their parents happy or get a degree in something you don't really need a degree for
The cost basis side is largely administration costs. Increase in demand for reasons that have been discussed resulted in colleges pumping up peripheral features.
There's the whole "in loco parentis" thing-- 25 years ago, college students were designed to educate adults. Not 20 year old helpless children with no worldly experience.
Some explain rising college costs in the same way as medical costs. While most other markets have found ways to produce things at a much lower cost with new technology, college and the medical field are less affected by technological innovations. Computers save today's companies massive amounts of money. Colleges still have to pay professors and the rest of staff, which commands a pretty penny.
TL;DR, The relative price of college tuition has gone up because relative prices for most other goods have gone down.
I work in administration for a university and I hate it because all of us work towards raising money for the university, so we can afford more administration, so we can raise more for the university......
One can make any graph look biased by cherry picking data. For example, why plot the rate of change for "median family income" instead of "average income of families going to college"?
The vast majority of Americans are stupid, and the nation as a whole ranks #25 to #30 annually in the global ranking of education.
Since there are so many stupid, minimum wage earning adults in America, it naturally drags down the average and median income level. However, those who come from an educated family have more resources and better parenting to put their kids through college or university.
So the correct comparison is to use the median or average income of families with kids going to college. Otherwise, all you're doing is comparing the income of hundreds of millions of minimum wage losers who will always earn nothing vs high income, high education families.