wealthy colleges questioned about costs

Parent Cafe
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<p>Afan notes, "The extra $35,000,000 would generate about $1,750,000 in interest revenue. If one used 2/3 of this to endow chairs, that would give about $1,150,000. This would not be enough to endow one chair. Where is the money for the other 49.5 chairs supposed to come from each year? "</p>

<p>Afan also notes, “Bringing in prestigious faculty requires more than endowing a chair for them. Many need huge amounts of start up money”</p>

<p>Response: If colleges wait till a faculty member leaves or retires, as I suggested, the college will not only have their regular salary available but an EXTRA $60,000 per year for the endowed chair. If $60,000 more than the usually yearly salary isn’t enough, make it $100,000 and provide less chairs. I would think that paying an extra $100,000 over and above what the colleges would normally pay a professor can get some top folks, especially in low cost-of-living areas.</p>

<p>As for expensive equipment needed, you are right when it comes to certain majors. However,for the vast majority of majors, such as business, language, math, liberal arts etc., there isn’t much equipment that is needed.</p>

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<p>“That being said, some of the examples in the original article were chosen for the sensationalism. When I started college in 1971 gasoline cost about 30¢ (I remember 22¢ at one point) a gallon, Twinkies cost 12¢ for a two-pack, Tootsie-Roll pops were 2¢, I bought a new BMW motorcycle with my job earnings for $1,400, and my tuition (only) at WUSTL was $3,300/year (which I paid with proceeds from loans paid back decades ago). Now, multiply any of those x10 and you get a reasonable approximation of what they cost now, today.”</p>

<p>I am planning to be alive in 36 years. If we have similar inflation in the next 36 years as the last 36 years, I hope I’m able to afford food. I wasn’t planning on working in my eighties. :)</p>

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<p>Who pays the taxes?
<a href=“http://www.townhall.com/content/abc91156-236d-494f-a708-a3818eb6edde[/url]”>http://www.townhall.com/content/abc91156-236d-494f-a708-a3818eb6edde&lt;/a&gt;&lt;/p&gt;

<p>X, I’d like to see some studies, links, something of the sort to support your position. Otherwise your posts remind me of a quote from Thomas Sowell;</p>

<p>“Envy plus rhetoric equals social justice”</p>

<p>Mind you I’m far from rich or independently wealthy. However, I know that as opposed to lamenting my socio-economic status, I strive to elevate my postion in life. There are abundant opportunities, no? I preach higher ed to my children so that they can be better prepared to take on the challenges and challengers in this global economy. Work smarter and harder, I tell them. When I was younger, a public school education may have cost me $15,000. In my mind it might as well have been $150,000. I havent made theat error in judgement with my children. It’s attainable, and as you’ve alluded to, it’s almost imperative if you want to have a decent standard of living. How much is that worth?</p>

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UCLAri - this is actually quite interesting. I’m not sure the median real wage between the US & Japan/Europe has actually realized that much change from the 1960’s.</p>

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<p>So faculty turnover is one of the limiting factors. It is extremely low, particularly among those whom you would like to replace with top scholars. The top faculty are at least modestly mobile, always being offered more money, resources, etc. Bidding for their services is intense. Getting into the competition for these people can be costly. </p>

<p>A few places (Texas and BU come to mind) have adopted a strategy of spending big to attract some names that ordinarily would not have these places on their list. Premiums of 100K are in range for the top people.</p>

<p>However, using funds freed up by departing faculty does not work that well. People don’t leave. Mandatory retirement is illegal, so you have people who got tenured decades ago still on the payroll, and who will remain there until they die, perhaps decades from now. This immobility is most likely among those who are never going to get another job offer. </p>

<p>If you did use attrition to free up funds, this would be a very slow process of beefing up the faculty.</p>

<p>The non science professors do not need expensive labs, but they do need benefits (approx equal to 1/3 salary), offices, secretaries, computers, grad students (if it is a university), library space is not infinite… There are costs far beyond salary in bringing in another faculty member, particularly some senior star.</p>

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<p>Mr. Payne,</p>

<p>Japanese real wages dropped a bit in the 90s, and France and Germany have had some pretty rough years here and there.</p>

<p>Granted, real wages are not growing quickly enough in ANY of the major industrialized nations. It seems to me, based on what I’ve read, that Gini coefficients are growing everywhere, leaving a lot of people behind the leaders. The three highest amongst the “Western” powers? US, UK, Japan.</p>

<p>Great to be ahead of the pack, eh?</p>

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<p>Wages are a very poor factor to study because they do not factor in “risk”, e.g., health care costs (amazingly, people pay more for that than they did even before Medicare was passed), wiped-out retirement savings, etc. - see <a href=“http://www.greatriskshift.com/[/url]”>http://www.greatriskshift.com/&lt;/a&gt; Many people think wage figures are used by the elite to try to “prove” that the middle class is doing well, when, in fact, all the money is basically going to the ultra-rich, all the “risk” is being shifted to the middle class, and 90% of the country’s families are going down the tubes. The Gini doesn’t do it justice, either. Not to mention the fact that it is going to get much, much worse.</p>

<p>Consider 401Ks as just one example. Our country uses over $100 billion dollars a year in potential/lost income tax to subsidize them. Almost 70% of that goes to the wealthiest 20 percent of Americans, while 12 percent to the bottom 60 percent of Americans. Also, the 401k returns that everyone has now aren’t even guaranteed, unlike the pensions that 80% of corporate workers had in 1980. We’re subsidizing the rich’s golf fees when they retire, on a massive scale, even before you consider all the government money going to the ultra-rich bankers, bond insurers, contractors, highway builders, homebuilders, etc. as opposed to investing in the long-term future of our Republic, like Europe does (which I’ve described above). It’s no wonder wealth, and therefore political power, has become increasingly more and more concentrated among the top 1% of Americans, while the rest of us can barely afford to buy milk for our kids. Most people can’t even afford a class at a community college, and 50,000,000 people don’t even have health insurance, i.e., society just doesn’t give a rat’s a$ about them! Real wages don’t tell you ANYTHING about what has happened.</p>

<p>The only viable solution is to raise taxes slightly on those folks making $1,000 per minute. As I detailed above, they’re only making that kind of money because of the great system we have all worked on (and in some cases, given our lives) creating for them.</p>

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Is that really true? I’ve always been skeptical of these numbers due to sketchy population statistics. No doubt that the real economic growth of the US is superior to those countries - but that is likely fueled by population growth than anything else. I doubt the delta in the per capita numbers are all that different from the 1960’s. Certainly with the recent dollar shift Europe looks more rosy from a real wage perspective than ever before.</p>

<p>I agree with your Gini points - I see them growing considerably for the next 20 years as well. It likely benefits us, not many of our countrymen though…</p>

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<p>Mr Payne,</p>

<p>Japanese wages very definitely dropped in the 90s. </p>

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<p>This is absurdly untrue. In California, I afforded community college with federal financial aid.</p>

<p>Oh, and still waiting on an answer to my earlier question. And sources. Either one would be nice.</p>

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<p>There are some wealthy schools that cost approximately $45,000 a year per student, but spend approximately $70,000 per year educating the student. A pretty good deal for the student and his/er family.</p>

<p>There are also some wealthy schools where the cost is based entirely on the ability of the family to pay. Some may pay $45,000 some $22,000, some less than $2,500 and still some nothing.</p>

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This is an absolutely false, at least in California and I suspect the majority, if not all, of the country. The cost at one nearby CC I just checked is roughly $20 per unit/semester. An 18 y/o living at home could easily pay this as they go with a bottom-end part time job (which are readily available). </p>

<p>posterX:
You’re throwing around the most extreme conclusions. What figure did you have in mind that “most people can’t afford” when you made the above statement?</p>

<p>I think people so concerned about extracting money from those more financially successful than themselves should focus more effort on building their own wealth than figuring out how to take it from others.</p>

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<p>ucsd,
In Colorado, there’s not much of a difference in cost between the University of Colorado (all but Boulder campus) and the local junior college.</p>

<p>Californians often don’t know how good they have it! (Though you obviously do :)</p>

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<p>"mini notes, " If they cut tuition, prestige come down. If they increase tuition, and give more folks “scholarships”, prestige goes up. </p>

<p>Actually Mini, I know how to increase prestige of a university,but it has NOTHING to do with scholarships. In fact, I can pretty much guarantee that a university’s rankings and admission scores would skyrocket using the following technique:"</p>

<p>Oh, you misread me. You don’t get ANY prestige from need-based scholarships. And you don’t get it by offering “better” education (whatever that is: H. ranks 27th out of 31 schools in students’ perceptions of their school’s education quality.) You get prestige from higher prices that rich folks are willing to pay (AND by rejecting large numbers of scholarship applicants. Folks in Greensburg, Kansas don’t remember past a year the guy who got some aid to go to Princeton and who never came back. But they remember for years the val who got rejected and ended up going to the state school. He comes back all the time.)</p>

<p>But, for prestige purposes, you can’t reject them all - otherwise, it wouldn’t be anything that poorer folks would aspire to.</p>

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<p>There are also some fine schools that don’t charge tuition at all!! But they’re darn picky about who they choose to attend. Cooper-Union comes to mind, and there are others.</p>

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<p>Berea…</p>

<p>But you can’t name the others readily because they lack “prestige”. Last time I looked, Cooper Union had about the same acceptance rate as Harvard, and well lower than MIT. But you’d never know it from a prestige standpoint. And given that income cutoffs mean that about 60% of the population can’t even apply to Berea, they are more “selective” than any other liberal arts college in the country, but again, you’d never know it.</p>

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<p>“should focus more effort on building their own wealth than figuring out how to take it”</p>

<p>Have you ever considered that 1 in 6 Americans are staggering under the weight of medical DEBT (not bills, debt), and that such debts cause up to 700,000 or more personal bankruptcies every year? Or that some people live in areas so polluted that they are dying of asthma and cancer? Or that some families have been working hard 100 hours per week at legitimate jobs, yet still can’t even afford to pay for rent and food and have seen the “pensions” they’ve earned over 50 years totally evaporate (and all of that money go to the ultra-rich, as a direct result of government actions)? What about the hundreds of thousands of homeless kids, how do you think they will “build” their wealth, by collecting more cardboard boxes? Do you think the current climate is giving many of people – e.g., the 1 in 3 non-elderly Americans who go without health insurance in any two-year period - an incentive to improve themselves and save, given that everything might be taken away from them at any point?</p>

<p>I’ve detailed this above, but the way our country works currently is not about allowing people to build wealth, it is about making sure that maximum profit is taken from every single transaction and kicked up to the ultra-rich. Sure, when the Fed builds a highway, directly subsidizes 401Ks, directly subsidizes mortgage debts or builds a new submarine a small portion of it goes to the middle class in the form of wages (whether it offsets other societal obligations is another story, that I’ve already gotten into above). But 60-90% of it goes to people who already own two or three homes and have 100 times more money, for no good reason other than perhaps the fact that they have more political power. All I’m saying is that maybe 50%, or maybe even 40%, of that money should go to the top 1% of the population, as you find in other developed countries, not 90% of it. Simple changes in tax policy, such as expanding the EITC so people actually have an incentive to work in the first place, would begin to correct this.</p>

<p>Trust me, I am not a socialist. I just don’t think it is fair when people are making $1,000 per minute as a <em>direct</em> result of the hard work and suffering of other people who haven’t been able to save $1,000 after 50 years of working 50 hour weeks in an assembly plant or electrical station. Those people are the ones powering the billion/year dude’s office, yet they are going bankrupt. Is that OK? Can you really meet one of these guys and with a straight face tell them that they should have saved more, when they’ve spent 50 years working, live in a tiny house, have had the government take away everything from them through payroll and other taxes, and have absolutely nothing to show for it except $100,000 in debts and a daughter who died because they couldn’t afford the health care? Shouldn’t the guys who built the highways that his mega-corporation relies on have a chance to afford a bus token, rather than have most of their wages taken away from them and then be thrown into a ditch? Even worse perhaps is the fact that so many hardworking people, even people making over $100,000 per year, are paying more and more in costs every year just so they can make up for the fact that there are 80 million people whose doctor’s visits had to be written off since they had no insurance. It’s just our government’s way of making sure that the ultra-rich keeps getting ridicluously wealthier, while the average person, even a very well-off average person, continues to have to pay more and more up to the top.</p>

<p>Secondly, and perhaps more importantly in terms of everyone’s interests (including Bill Gates’s), I also think that our economy is incredibly inefficient because we are basically borrowing a trillion dollars from China, buying a lot of oil, then pouring it on undeveloped farmland in order to build highways, subdivisions, WalMarts, etc. All of this is directly subsidized by the government, and again, obviously 90% of the money involved in these activities go directly to line the pockets of the wealthiest 1% of Americans, while the rest of us are expected to pay it off over the next 100 years using lower and lower real wages every year. We should be more about conserving farmland and investing in things that will improve the society 5-10 years from now, not things that are going to completely and utterly destroy it. It’s going to be great for the people with 10 different houses, but not for the rest of us who are literally going to be starving to death. In some sense it is too late, because the next three generations are going to be paying off the debts caused by the shortsightedness of the system we have right now.</p>

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<p>“Trust me, I am not a socialist.”</p>

<p>Too bad. I was hoping. :wink: The only socialists these days are those who own and run the corporations, who unite in their common class interests together to ensure government and economy run smoothly, and to their liking.</p>

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<p>On one hand, America must address the unacceptable reality that so few can afford higher education. On the other, when top colleges are spending more on each student than they are charging in tuition, how can one accuse them of price gouging?<br>
America’s solution to the problem of affordability has been a system of less costly state universities and various forms of need-based financial aid and loans. The system has been less than perfect.
Some who are dissatisfied focus their attention on huge universtiy endowments. Is this fair and appropriate? It seems odd to point fingers at universities that are already volunteering enormous amounts of need based aid and to tell them that they should be doing more or that what they are doing is wrong. The investment and disbursement management of these endowments is conducted by some of the brightest minds in America.<br>
The solution to the larger problem of affordability does not involve anyone dictating to universities how they should be managing their endowments. The tuition subsidies and need based scholarships which are made possible through the generosity of endowment donors, are part of the solution rather than the problem.</p>

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<p>The universities, both public and private, should really be setting the sticker price at about $100,000 per year, which is the actual cost, and giving out much more generous grants to any family making less than say $800,000 per year. But they want to avoid making a political statement, and also it would be hard to get everyone to raise tuition more than 5-10% per year. </p>

<p>And in a way, they’re just like everyone else in terms of subsidizing the rich to a massive extent and making the poor and middle class pay for it. Not a surprise given that the average university professor is getting a little bit more (not a lot more; only the ultra-rich get a lot more) out of the system than he/she is putting in, in terms of being pretty secure economically, having fine roads to get to work and getting nicely subsidized government grants/electricity while everyone else slaves away for 50 hours per week, saves nothing, sees their pensions completely evaporate, is being taxed to death through payroll taxes, is under constant threat of losing their home, has no health insurance, and is paying 30% of their income on prescription drugs that, perhaps ironically, help pay for enormous grants for university biomedical research (but to be fair, mostly go towards lining the pockets of the top 1% of top 1% ultra-rich shareholders).</p>

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<p>posterx, I am enjoying reading your posts.</p>

<p>I don’t see much change happening since the top presidential candidates and congress rely on the top 1% to get elected.</p>

<p>I see that the cola for social security next year is 2.3%.</p>

<p>What an outright lie.</p>