<p>“A new report provides some surprising answers that will, unfortunately, probably only frustrate and anger [students and parents] even more.”</p>
<p>[The</a> Secret Reasons for Tuition Hikes - Yahoo! News](<a href=“http://news.yahoo.com/s/usnews/20090116/ts_usnews/thesecretreasonsfortuitionhikes]The”>http://news.yahoo.com/s/usnews/20090116/ts_usnews/thesecretreasonsfortuitionhikes)</p>
<p>I think the main factor behind the increase in tuition is the willingness of students to take out loans. Colleges know many students are willing to borrow to attend a dream school, and so increased their tuition over the years. Students kept on taking out more and more loans to pay, and colleges kept in increasing their tuition. If more students stepped back and said “No, I won’t take out loans to pay this,” I don’t think the tuition hikes would be quite so bad.
The increase in tuition at dream schools then trickled down to the rest of Academia.</p>
<p>“Among the more surprising findings:
–The main reason tuition has been rising faster than college costs is that colleges had to make up for reductions in the per-student subsidy state taxpayers sent colleges.”</p>
<p>This is a surprise?</p>
<p>“I think the main factor behind the increase in tuition is the willingness of students to take out loans. Colleges know many students are willing to borrow to attend a dream school, and so increased their tuition over the years. Students kept on taking out more and more loans to pay, and colleges kept in increasing their tuition. If more students stepped back and said “No, I won’t take out loans to pay this,” I don’t think the tuition hikes would be quite so bad.
The increase in tuition at dream schools then trickled down to the rest of Academia.” </p>
<p>Sentry that defines the problem quite clearly. And 1moremom you’ve also stated the problem quite clearly. But is seems our leadership constantly lacks the ability to draw these conclusions, or they have chosen not to do so for reasons otherwise than serving the best interests of the electorate. </p>
<p>And if one tracks the decline in state and federal support, to the increase in student debt, and the rise in tuition they all closely correlate. Essentially what happened was a long term lobby campaign by the educational lending industry which effectively shifted the emphasis in higher ed support away from the state, and redirected it through their coffers. Essentially the average 6% yearly rise in tuition which began before the turn of the century can be traced to those changes. </p>
<p>Have to remember that with the subsidized loans federal money is backing these things, and that money could have just as well gone to direct aid to schools or to such as Pell grants and etc. And that doesn’t include the federal funds which have been eaten by all the corruption within the educational lending industry and its relations with the federal and state government. At one estimate (and that’s probably on the low side) its about 1.7 billion dollars. And just that one over billing of some 250+ million by one company alone would have paid the first two years of college for every student in Colorado. </p>
<p>The whole transfer of emphasis to this industry, has made them billions but caused innumerable problems within academe and certainly serious trouble for students and families. And the tragedy of it all is that this industry did not exist until fairly recently, and could only exist by the co-opting of what had been much more equitable and functional systems. </p>
<p>The dilemma for students and families is that attending college has become expected in our society. And it’s not just the cost of dream schools because within the relative income of the populations generally enrolled for education at a CC or state U it still can cost too much and entail too much debt. </p>
<p>The tragedy is that the sweetheart conditions granted to the educational debt industry will eventually destroy academe here in the US. We can have extraordinary colleges, but if it becomes a economic fools game to attend more and more people will opt out or be unable to even consider higher education. Currently the estimated amount of debt resultant from this situation is some 564,113,200,900$ and that obviously cannot be sustained too much longer. We are close to the point where this system cannot be sustained and then all the trophy buildings and unneeded expenses which the debt feeding frenzy brought into higher education-will look like the lingering remnants of other failed systems.</p>
<p>And the incursion/infection of academe by these financial schemers will cause academe to fail in other ways, even if it doesn’t cause a systemic financial collapse due to the overt predation on the populations academe needs to survive. </p>
<p>Ethically this situation makes it much harder for academe to serve the people; when increasingly many perceive that systemically academe is serving up those who come to it for education and elevation. </p>
<p>Additionally academe in this country largely exists to give people the ability or potential to enter the middle classes or preserve their status within it. But as costs have escalated along with student debt, rapidly that potential for escalation to or preservation of a middle class status is becoming difficult to reconcile. When the point is reached when it can no longer be reconciled we will have lost an essential component to this countries economic and social stability.</p>
<p>^well said, but i doubt students will back off b/c they’re always told going to college is the key to a great successful career and larger salaries.</p>
<p>The problem is many within academe themselves are doubting whether the system should continue, or can, under these conditions. </p>
<p>And from a very subtle sense, students are picking up on that condition. So yes many pay whatever toll is needed to attend college, but an increasing number are becoming very uneasy about the barely disguised exploitation inherent to our current system. </p>
<p>Critical thinking is one matter, systemic loss of faith is another. The first improves a system, the latter can destroy one…</p>
<p>I agree with 1moremom. This is not a surprise at all (decrease in state appropriations to higher education over the decades). Just look at the state of Michigan. The tuition hikes have been enormous here and other parts of the Midwest. These schools must stay competitive. Now Univ of Michigan is among the most costly public universities in the nation.</p>
<p>Reasons for the tuition hikes:</p>
<p>1) People <em>will</em> pay.
2) Colleges like to make money.
3) Loans can not be cleared during bankruptcy. [If they were cleared during bankruptcy then lenders would be far more discriminatory when giving them out.]</p>
<p>“3) Loans can not be cleared during bankruptcy. [If they were cleared during bankruptcy then lenders would be far more discriminatory when giving them out.]” </p>
<p>M.Payne you’ve noted one of the consequences of our current educational funding system. If these debts could be cleared by bankruptcy there would be a mechanism in place to ensure predatory lending practices would not continue. </p>
<p>These companies do not need to be appropriate in their lending practices, because the same set of laws which denied basic consumer protections also permitted these lenders to charge excessive fees, make a killing by not working with borrowers and etc. Take a look at the corporate statements of the major players in this industry especially their collections subsidiaries, they have no real interest in lending in a responsible manner. The manner in which they can manipulate the system by not doing so is actually quite profitable. In that regard they are not dissimilar to some of the more shady aspects of the mortgage industry. They are different insofar as an entire regulatory was set up for them to ensure that normal market forces play no effective role in their arena. </p>
<p>As a result there is no way this industry and its effects on society can be considered comparable to standard and ethical business practices.</p>
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<p>Dude, if you’re gonna try to scam ppl at least try to sound professional. This looks like you used a free translation website.</p>
<p>Another secret? It is well known that for some products, price signals quality. Education is one of those products and this fact is well known to those in the education industry. Oddly if its inexpensive, people assume it can’t be that good; if its priced high it must be worth it! </p>
<p>I had witnessed in my own prior school these exact discussions, and I have seen the data supporting this strategy. When they raised tuition for a specific program by a very substantial amount our applications soared and our yield went up. Exactly as the plan was meant to go. </p>
<p>If and when parents start to realize that education is just like any other for-profit industry, they will start to make different decisions.</p>
<p>"The dilemma for students and families is that attending college has become expected in our society. And it’s not just the cost of dream schools because within the relative income of the populations generally enrolled for education at a CC or state U it still can cost too much and entail too much debt. "</p>
<p>Indeed. I make a very fair income, much more than a school teacher, or a nurse. I do not have a college degree. I graduated from high school in 1979, and I did not need a degree to get a job in my industry, as a matter of fact, I kind of fell into my career.</p>
<p>Today I would not get hired as a 21 year old. I would have to have a degree. If my company went under, I would get a job, but only because I have so many friends and connections spread out across the industry, and I have a solid track record of success.</p>
<p>My small company has been laying off people. The last standing? Two of us 40+ folks with no college degree. The kids we hired with degrees lacked motivation and did not do well.</p>
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<p>Actually, they are no different than the mortgage industry. Congress set them both up to “ensure that market forces play no effective role…”</p>
<p>I see a big part of the answer right here in the article:
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<p>Only it’s not just the “best” students; colleges are in competition for the “neediest” students too. There’s no question that need-based aid (both private and public) raises the sticker price. If you’re not paying full price for your education… somebody is, quite possibly on top of the full price for his own. As Atana said, and bluebayou underscored, natural market forces are not at work here. And that’s not good for controlling tuition rates.</p>
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<p>In public universities (at least in my area), toward the end of the fiscal year, there’s a flurry of last-minute spending as units determine (or discover) the amount of money they have left. Department heads start talking about “the money truck.” When the money truck dumps, you use it or lose it. Often you lose it twice over: If you don’t spend ever dime of your budget this year, then your budget will be lower next year. And if you find a way to overspend, then obviously you must need more, so there’s a good chance your budget will be increased in the future. If the state won’t cover you, then at least you can raise tuition… seldom will a tuition increase be denied by a state legislature, since part of the tuition remains in state coffers.</p>
<p>It’s sadly, tragically easy to spend other people’s money.</p>
<p>"Actually, they are no different than the mortgage industry. Congress set them both up to “ensure that market forces play no effective role…”</p>
<p>Quite true BlueBayou.</p>
<p>I am poor, so this does not apply to me.
I don’t pay for my tuition and books.
I am at home, and have no bills, and go to a state university.
Am I lucky? Not really, I am still poor even with welfare.</p>
<p>Agreed with tenisghs. I’m convinced that Michigan is raising their tuition just to support their athletics and medicine (two BIG construction projects going on now). A new indoor practice field?!?!</p>
<p>How about updating those libraries to match the Ivies’?</p>
<p>Also remember that colleges raise tuition in order to build new facilities that will wow high school students and their parents and in turn, these “customers” will pay more to have these facilities and perks. Just because laundry or a new laptop by the college is “free”, it doesn’t mean they really are- they’re part of the hidden cost of the said raised tuition. Money has to come from somewhere. Michigan’s “fitness centers” for the rest of the student body are downright embarassing for a Big 10/D1 school.</p>
<p>TMP
As you noted one of the preeminent reasons for the trophy buildings is marketing. And in a strange but subtle manner via an incredibly unethical causation, these edifices breed from how many students and families finance their educations via debt. </p>
<p>If colleges looked like something out of the old Soviet Eastern block, but provided high quality educations…it’s very probable that people would really begin to question the massive increases in tuition and the pervasive involvement of the lending companies in academe. </p>
<p>As such glitzy buildings do serve as a useful marketing distraction in what is quickly becoming an economically and morally indefensible system. </p>
<p>It’s fairly obvious this questionable tactic is well entrenched as looking at most college catalogs can verify. </p>
<p>Perhaps it’s a little cynical, but trophy buildings and other glitter are actually a fairly cheap way for academe to evade criticism for inefficiency, inability to retain other more ethical forms of funding and outright and immoral collusion with the lending industry. Simply because it’s ultimately the students and families who foot the bill…for years to follow.</p>
<p>“There’s no question that need-based aid (both private and public) raises the sticker price. If you’re not paying full price for your education… somebody is, quite possibly on top of the full price for his own.”</p>
<p>And those paying full freight, by working and saving and scrimpping, are getting really tired of paying for those whose parents chose to become potters or social workers or ecologists and now demand expensive education for their kids. If I hear of one more full-boat scholarship kid taking resort vacation in the Caribbean or going to Egypt on an exchange program, I will go postal. My kid can’t afford these luxuries - but the scholarship kids can!!!</p>
<p>Don’t expect me to pay for your kid to go to an expensive college.</p>
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<p>That may be a bit of a generalization. There’s a lot of genuine need out there.</p>