Philadelphia Inquirer article about increase in merit aid to non-needy students

<p>This was in today's Philadelphia Inquirer. It seems that the topic of merit awards versus need-based awards, and the relatively low number of low-income students attending college is becoming a topic of media attention.</p>

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<p>From a personal point of view, we are very proud of our daughter for receiving a merit award from a great school. However, the article emphasizes the fact that for every dollar spent on merit awards, one less dollar is spent on need-based awards for a student who cannot afford to attend without aid. </p>

<p>I think the article did miss addressing the point that the cost of private college is so high that many families who do not qualify for need-based aid do not feel they can afford the cost. Merit aid makes it possible for many middle class students to attend private colleges which they could not consider otherwise.</p>

I agree with you on that point. Also, the higher ranked a college can become, the higher the prestige and the more full-cost students it can attract and thus, the more need-based aid it can eventually provide. One way to increase the ranking and prestige is to provide merit aid to top students. So maybe it's not so simple.</p>

<p>Kind of like the argument that tax cuts will stimulate the economy and actually bring in more taxes in the long run.....</p>

<p>could you please cut and paste the article here. Thanks</p>

<p>Here it is. It also showed bar graphs showing that the amount of aid to wealthier students and the percent of wealthier students receiving aid has increased between 1996 and 2004. </p>

<p>Aid for least-needy students
To lure achievers, colleges stress merit-only scholarships.
By Patrick Kerkstra
Inquirer Staff Writer</p>

<p>Lucrative college-scholarship offers are piling up in mailboxes across the country this month, the most generous of them sent to relatively prosperous neighborhoods, such as the Northeast Philadelphia enclave where George L. Weber and his daughter, Lauryn, live.</p>

<p>Weber, a doctor, had hoped Lauryn's outstanding grades and SAT scores might win her a grant to "make our lives a little easier." Instead, seven schools came through with major awards; six proffered full rides.</p>

<p>But while Lauryn, 17, decides which dream invitation to accept, a growing number of critics are questioning the wisdom of such scholarships, also known as "merit aid."</p>

<p>"I have to turn down some financially needy kids because we can't afford to pay their tuition, but at the same time we're giving out $1 million a year to kids who don't need it," said Robert J. Massa, vice president for enrollment management at Dickinson College in Carlisle, Pa., who is slowly reducing the level of merit aid there.</p>

<p>In the last eight years, college grants to wealthy students grew more than twice as quickly as grants to students with families of modest means, according to federal statistics. Indeed, students with grants in the $100,000-plus bracket - the richest tracked by the federal government - now receive an average of $6,200 apiece, which is more than any other income group.</p>

<p>"The worst part of the story is, that money seems to be going upward, which means that these merit awards have essentially been a boon for people with money," said Richard DiFeliciantonio, vice president for enrollment management at Ursinus College in Montgomery County.</p>

<p>Merit aid does not stop at snaring funds that could be going to financially needier students, critics said. They also say that schools have raised overall tuition rates to cover their bigger merit budgets and that merit aid has led students to choose colleges that offer the best "deal," instead of the best fit.</p>

<p>Perhaps most worrisome, they say, is the way merit aid has fostered what Massa calls the "commodification of higher education." Admissions officers now speak openly of "customers" instead of "students," of "pricing schemes" and "the sticker price."</p>

<p>Admissions officials have developed complicated and opaque tuition structures using merit that, in effect, allow them to raise or lower the cost of college depending on how desirable a given student is. Parents are increasingly wise to that, and more are haggling with admissions officers over the size of their student's scholarship.</p>

<p>"There's a sticker price, but hardly anybody pays it," said Timm Rinehart, Temple University's vice president for enrollment management. "Colleges and universities work like airlines - we set a different price for different customers."</p>

<p>Yet for all that, colleges and universities are virtually certain to distribute more in merit aid this year than last, continuing a two-decade trend.</p>

<p>Until the 1980s, virtually all colleges and universities awarded scholarships based almost exclusively on financial need. But by the early 1990s, struggling schools - Ursinus was one at the time - were rapidly expanding their merit programs to attract students who were enrolling elsewhere.</p>

<p>At many colleges, the strategy worked. Soon, rivals of Ursinus, such as Dickinson, felt compelled to offer merit grants of their own. Similar scenarios played out in markets across the country. Even public schools got into the game.</p>

<p>"We very deliberately changed our financial-aid strategy and went from being almost totally need-based into putting all our new financial-aid money into merit," Temple's Rinehart said.</p>

<p>Although Temple has not pumped up its merit-aid budget in several years, he said the move had played a valuable role in getting top students to take a closer look at the school.</p>

<p>"If you're an institution like Temple that needs to improve its academic image and reputation, you want to give a family a reason to choose you. You want them to be able to say at a party: 'We chose Temple. It's a good school, and, you know, they gave our kid a scholarship,' " Rinehart said.</p>

<p>Massa considers that little more than buying better students - something he has down to a virtual science.</p>

<p>"Look, I know that to increase my SAT profile by five points costs $1,000 per student - for five lousy points," Massa said.</p>

<p>Only elite colleges and universities, such as those in the Ivy League, have been immune to merit-aid pressure. Parents and students who can afford those schools are willing to pay full tuition, and grants are still based almost entirely on need.</p>

<p>But outside those select institutions, merit scholarships have become ubiquitous. At St. Joseph's University, for instance, a B+ GPA and an SAT score close to the national average will net an "Achievement Scholarship" of up to $28,000. La Salle grants $16,000 to any applicant with a C+ average who graduated from a local Catholic high school.</p>

<p>"The genie is out of the bottle, and there's no way we can put it back in," said Robert Voss, dean of admissions at La Salle.</p>

<p>Which is fine by students and parents receiving the awards. The cost of a college education - now averaging $20,000 a year for tuition alone at private schools - is enough to tax the resources of almost any family, even relatively well-off ones such as the Webers.</p>

<p>"Unless you're Trump, the scholarships matter. We would do whatever was necessary, but obviously this makes it a lot easier to pay for the next two [children]," said Weber, who was surprised to find that by colleges' calculations his daughter would not qualify for need-based aid.</p>

<p>"They say we had no need. A family practice in Philadelphia isn't a cakewalk anymore."</p>

<p>Indeed, merit grants have become so politically popular among the middle and upper-middle classes that 27 percent of taxpayer-funded undergraduate grants made nationwide are now based on scholarship instead of need, according to a 2002-03 survey by the National Association of State Student Grant and Aid Programs. Pennsylvania is one of 20 states that base undergraduate grants purely on need. New Jersey makes some merit grants, but the vast majority go to students with low family incomes.</p>

<p>That is smart public policy, said Lara Couturier, a higher-education consultant.</p>

<p>"When we give merit aid to the middle class, we affect their quality of life - whether they go on vacation that year or get a new car," Couturier said. "When we don't give that aid to lower-income students, it affects whether they go to college at all."</p>

<p>In real life we all go after what we can afford but would like the best with our money. Similarly a business that does not follow these practice often end up being closed by the competitors. As a consumer we all support it in real life, but somehow strangely when it is college education we try to shun away the basic economics policies of Adam Smith's economics theory. Ursinus College is doing what is best for them by offering the merit award. I do not see anything wrong in merit awards as people will work harder and compete.</p>

<p>Isn't continuing an education the goal? WHY would you not want the students that have chosen to do the work and make the grade as a priority? I certainly understand and rely upon a school looking at the financial situation of a family-the majority of students need assistance. But, I believe the fairest method is to determine the aid based on the student and their accomplishments, such as classes taken, activities, GPA & SAT/ACT, not on their family.</p>

<p>This superbly written article, one of several on this subject that I've seen recently, is very thought-provoking. Mini, who may well weigh in on this subject, has frequently pointed out that "need-blind admissions" is a canard, because the amount of need-based aid available is limited to a fixed amount. There seems to be little doubt that it's a shrinking amount at many colleges as a bigger slice of the aid pie is devoted to merit aid. </p>

<p>The article focusses not on the major full-ride scholarships offered by Duke, Wash U, Emory, Vandy and others who are trying to lure very top applicants away from HYPSM type scools, but rather on the much broader realm of "discounts" of a few thousand dollars offered by many many colleges to attract applicants they'd like to have. I don't know, but I'd bet that this adds up to a much bigger slice of the aid pie than the A.B. Duke type awards.</p>

<p>"As a consumer we all support it in real life, but somehow strangely when it is college education we try to shun away the basic economics policies of Adam Smith's economics theory."</p>

<p>It's because, when it comes to luxury goods, Adam Smith's theory is wrong. The higher the price, the greater the prestige, the higher the demand. (Actually, he was wrong about a lot of things - he dealt with a very brief period in economic history - basically 1760-1775 - before King George III started buying cannons to fight the upstart colonials, hence disrupting the "free market" forever, and in such a way that it hasn't existed for almost 250 years.)</p>

<p>It makes a lot of sense to the schools, especially if they have a need for the "better" students.</p>

<p>Can't help but remember some (apocryphal ?) quote from years ago, possible attributed to the President of the University of Oklahoma........ "We're going to do our best to build a university that the football team can be proud of." Although merit aid programs have nothing to do with the athletic prewess of the school, it does help improve the acadmemic "output" if you can improve the input.</p>

<p>Dadx's comment put a thought in my mind. Why aren't any articles written about the unfairness of giving ATHLETIC scholarships to students with no financial need? The dollars spent on these take away from both academic merit and need-based scholarships to other students.</p>

<p>There have been many suggestions to just pay the danged athletes in the high stakes programs and be done with pretending that they are scholars, and I do see merit in that suggestion in many of the top athletic programs. Those kids work harder and more hours than most kids with jobs at college. And it is mandatory for them to put the time in, as they can lose it, all or nothing. It is not necessarily a win-win situation for many of these kids. Also many of the kids with no financial need, in fact all of the ones I have known, do not look for the scholarship money as much as they try to parlay the athletic prowress into a higher bracket of schools than the kid would ordinarily get into. Those who need the money to go to college end up going to some school that would often be off the radar screen just for the money, like University of South Dakota, University of Kansas. The two kids I know who got full aid there, did need money to go to those schools but they were catches not only in the athletic sense but how many east coast kids want to go there? There are usually trade offs. It is the highly talented athlete, and they are truly rare birds who get money from schools that people want.</p>

From the article: "When we don't give that aid to lower-income students, it affects whether they go to college at all."

[/quote] affects whether or not they go to the private schools discussed in the article. I would also note that many if not most of the low-income students with credentials matching those of the middle and upper-middle class kids getting merit scholarships to the colleges in question....will be getting need-based aid at some very elite schools that are out of the reach for most families that are not truly wealthy. Which is to say, it all works out in the end.</p>

<p>I see nothing wrong with a school trying to improve the academic quality of its student body by offering academic or "merit" scholarships. We've been told for a long time how it is important that a college have a "critical mass" of various ethnic groups in order for the student body at large to have a full educational experience.....How can it not be just as important to have a critical mass of brainy, hard-working young scholars in their midst, regardless of their economic circumstances?</p>

<p>Driver, are you saying that many if not most low income students unable to get need-based aid at Temple or Dickinson because the money is going to merit scholarshps will get it at Harvard and Yale?</p>

<p>No. I'm saying that the kids who are getting merit scholarships have very superior stats. And that any low-income applicant with similar stats is likely to be offered need-based aid at elite colleges that don't offer merit scholarships....schools that many of the "merit scholarship" kids thus can't afford.</p>

<p>Driver, your argument does not hold. There are very few low income students at the elite schools, if you look at the Pell figures. Doesn't really make a dent. Most low income students do not have the stats for those schools. Most of them have trouble getting enough money to pay for the schools that will accept them as these are not the schools that are generous with financial aid. What usually happens is that community college is the only viable option, and these are often the very students who need to be taken out of their environments to have a chance to beat the odds that their backgrounds give them. Often they do not have cars and need to take a series of buses or other convoluted ways to get to school, often not so dependable. I know that our state school does not have a direct line from many of the low income areas to easily commute there, and the whole system has gone haywire when the buses go on strike which they have done a few times already in the 5 years I have lived here. Then you are sunk transportionwise. Also, they do not guarantee full need, and even tuition alone exceeds federal grant amounts so those kids who are truly needy must take out loans, have no time to work given their commute and often are needed at home as well, and do not qualify for merit funds. And for them even $1000 a year that is often gapped is a big problem for them. The cost of commuting, by the way is not low. If they are to spend the day on campus, they either have to pack a cooler with food or bring some cash to eat, things do cost money on campus, nominal to anyone without true financial problems but to the needy......, and transportation, though students do get a break, it still costs something. Most drop out. The rates, which I researched are appalling. I wonder if these kids could just get a 4 year ride and just have to cope with being a student instead of having the commute on their back and having to live in 2 different worlds in the same day, would they do better? And my son who does not need it, got a full ride+ from this school--all merit aid.</p>

Most low income students do not have the stats for those schools.

I don't disagree with that.
My point was that I don't think any low-income kids with merit-scholarship stats are going wanting, and in fact may make out better than their middle class counterparts. I was pretty clear on that.</p>

<p>"It's because, when it comes to luxury goods, Adam Smith's theory is wrong. The higher the price, the greater the prestige, the higher the demand"</p>

<p>Mini I am not a student of Economics. However, let me start with Duke, U of Chicago and U Washington at St Louis are offering merit aid on a limited basis to boost their numbers. The higher the prices, the higher the demand does not hold true in the case of Concorde Flights. It is not holding true in the case of department stores, which are almost closed, as they cannot compete against Wal-Mart and Target stores.</p>

Merit aid does not stop at snaring funds that could be going to financially needier students, critics said. They also say that schools have raised overall tuition rates to cover their bigger merit budgets


Another interesting point about this article, which clearly has an agenda. We have been told ad nauseum that need-based aid is not being foisted off on those who can pay, but that it comes instead from endowments. So need based aid can't be blamed for rising tuitions, but merit aid (much rarer), can.</p>

<p>Unfortunately, they do. A school would much rather get 4 kids who do not need the money by giving out $5000 apiece for them and call it some sort of merit aid, than have to spend the $20K on a low income kid who absolutely needs that money to even have a stab at going to the school, even if that kid is deserving of some merit money. Again we are not talking about the top schools, many that do not give merit awards at all. Some of the schools where my son applied, he did get merit awards, some pretty hefty ones, and those were schools where they clearly wanted that top SAT1 score on their book, but the one school I am now viewing, does not guarantee 100% of need and in fact only gives about 40% of need on average. And yet my son would basically get to go there for free when he doesn't need a dime. But on top of that they do give out $3000 merit awards to kids as well but are not need blind, I notice. 10 merit awards could net a full need kid of equal numbers. Because this school is not selective and is expensive, it needs to buy bodies to some degree,and in doing so wants the most for its money. A full or near full need kid would have to have higher merit scholarship stats than a non need kid whose parents would just love to get a few thousand off the tuition, plus for a private school it is a good $10K less expensive, so it can be a significant savings for that middle income family that does not qualify for need but is supposed to be able to pay the full freight.</p>

<p>OK, consider Dickinson College, one of the subjects of the article, where the admissions person laments that they are spending $1M per year on students "who don't need it" (merit aid). Dickinson spends about $15M on need-based aid. $1M seems a proportionally paltry amount to spend in order to attract a higher caliber student who will contribute to the intellectual "critical mass" of the institution.</p>