If the girl in your dorm has a poor family and you don’t, you are at an advantage in many ways even if she gets more financial aid than you
One reason for tuition increases is the tax treatment of large endowments. Several schools are sitting on huge piles of dough. I was told years ago that they more or less have to spend 5% of the endowments each year to maintain favorable tax treatment. This money is invested and earns more than the inflation rate - so the next year the school has to spend more. So if they charge more, and give away more, the net cost to families at the low end is the same, but full-pay families have to contribute more.
Not sure if this is still the case, but it did explain the big tuition hikes when I was in school.
Bernie Sanders is all about subsidizing the poor. If they lowered the cost for everyone there wouldn’t be any ‘extra’ to give to the poor.
@Proudpatriot Yeah, because it would lower the cost for EVERYONE
There is no reason to lower tuition for the rich. A high tuition with generous income related reduced costs for others distributes the wealth. Let the very wealthy support the others. There will always be that income level which is too rich for aid but too poor to afford things.
Okay- so tuition is lowered for all. Where does the money to pay costs of educating the students come from? Higher taxes? This will hurt the middle class most.
Consider yourself lucky you had an upbringing which meant you didn’t qualify for as much aid. Think about everything you had in HS, then take it away. Take away the new clothes (well, new underwear), spending money, family vacations, nice meals at home and restaurants, coffee and so many other things. I scrimped in college because I had to. My wardrobe was pathetic. I was lucky to be in a state with good public education and to be able to earn scholarships. You likely had a much richer environment growing up. Quit complaining.
[quote] @proudpatriot Bernie Sanders is all about subsidizing the poor. If they lowered the cost for everyone there wouldn't be any 'extra' to give to the poor.
@iamjack Yeah, because it would lower the cost for EVERYONE
[/quote]
I think you have a fundamental misunderstanding of what Bernie Sanders’ position is on this issue.
He is proposing to do exactly what you are suggesting - eliminate tuition for everyone (at public colleges). Not just the poor.
https://berniesanders.com/issues/its-time-to-make-college-tuition-free-and-debt-free/
I don’t think I have a fundamental misunderstanding of anything. At private universities tuition for full pay students is inflated so that there is ‘extra’ money to subsidize poor students. This happens. I personally resent paying more so someone else can have their tuition subsidized.
If tuition is eliminated at public universities who do you think is going to pay? Tuition free doesn’t mean there is no cost. Tuition free means someone else is paying. As long as it isn’t them most people are happy to let other folks pay for their child to attend college.
What’s your definition of “poor”? The median income in the US is ~$50k. Even with a $20k/year discount, those families aren’t sending their kids to $45k/year schools. The schools that give full, or nearly full, need based aid are using endowments to cover the costs, so tuition money from full pay families isn’t going to poor students there either. The families who can cover $20-30k/year or more after tuition discounts so their kids can go away to school, those people aren’t poor.
@Proudpatriot wrote
There’s even a name for it. It’s called the “high tuition/ high aid” model.
@austinmshauri - Of course full pay students subsidize others. Colleges could use the endowment $ to lower the costs to ALL students but they don’t. They charge a higher price to some and use the money from their endowment to subsidize others. Money is fungible. No matter how the money flows some are paying more so others pay less.
"As long as it isn’t them most people are happy to let other folks pay for their child to attend college. "
I am happy to contribute to the cost for other people’s children to college if they are suited to it because it is ultimately in my best interest to do so.
Better educated population = better society. Better educated worker = higher paying job (theoretically anyway) = more private investment dollars and more tax revenue to fund that better society and so on…
" At private universities tuition for full pay students is inflated so that there is ‘extra’ money to subsidize poor students. This happens. I personally resent paying more so someone else can have their tuition subsidized."
It is way more complex than this,and different schools have different models. But all schools are rife with cross-subsidies.
Rich subsidize poor. Not-so-smart subsidize smart. Donors and endowment subsidizes all. State taxpayers subsidize in-state students. Out-of-staters subsidize in-staters. Federal taxpayers subsidize those receiving federal aid and federal-backed loans. And so on.
If you don’t like the subsidizor/subsidizee equation for you at a particular school, pick another one where the equation suits you better. There’s a lot of different schools and equations to pick from. Including some schools now that are going to the “every day one low price” model as compared to the “high sticker/high discount” model.
When my last kid applied to college, our choices ranged from $12k a year (in-state tuition plus merit scholarship) to $60k a year (full pay private). We picked a school that was between those two options.
“At private universities tuition for full pay students is inflated so that there is ‘extra’ money to subsidize poor students”
If you really resent this, then eliminate those colleges from your child’s list. That’s what thousands of other parents do every year. They think it absurd to pay 60,000 $70,000 a year so they don’t. (Millions, of course, eliminate these schools because they can’t afford it)
Would you be fine with the high COA if the private universities limited their students to only people who could afford full pay? You would still be paying the same amount but not feel like you’re “subsidizing the poor”.
Schools have big sticker prices so they can offset the amount of aid they give. Look at small lacs they cost 65k with room and board. A lot of them offer 100% of financial need. I am middle class and my packages cost 10k less than in state schools. In state schools don’t offer me any aid so I can’t afford them, why would I go to them.
The high sticker price brings in enough money for schools to still have enough after providing all with the aid they can. Do you really think a school would do better giving aid from a 65k tuition or having a base 12k tuition. 12k is not affordable to some people, and 12k is more than affordable for some people.
High sticker prices with more aid from the school is the best way.
Economics says that if someone will pay a high cost, that’s what schools will charge. Also known as “because they can.” And free tuition at public universities isn’t going to solve problems. Here in MA tuition at local state colleges (not community colleges) is less than 1k/semester. Schools get around this by charging zillions in room & board, fees, etc.
You can qualify for need-based aid at private institutions if you make over $200,000. People who don’t bother applying either are well above this income (and will get little sympathy from others) or are trying to up their chances at a school by not applying for FA. Their choice.
If you have a high income and still want tuition to be free, go to a school where you’re one of the very strongest candidates, and they’ll bribe you with merit money.
You’d have to make over $200,000 but have no assets to get any aid, I would think.
There is financial aid for $200k incomes, but only at a handful of the most elite wealthy schools. Like NYC Mayor Diblasio whose kid gets financial aid at Yale. The Mayor probably gets $15-20k or so knocked off the Yale sticker price. Which is great if your family/kid fit the parameters.
In the remaining 99.5% of the college world, that doesn’t happen.
Of course, that smart Diblasio kid could have gotten a much lower price (via merit aid) at a school a bit lower down the ladder. Where he would have been subsidized by the family of a not-quite-as-smart kid.
But Bernie Sanders doesn’t have a position on that so what does he have to do with it?
That model is based on the administration, trustees, etc of those privately owned colleges. Your beef would be with them, not with Sanders.
@morkatmom -Isn’t that what public universities are for? I have no problem subsidizing public universities because it helps our country be a better version of itself. We pay taxes and those taxes go towards bettering our country. I have a problem with private universities getting into that space. I don’t think it’s ok for a private organization to charge different customers.
@SlackerMomMD-I don’t think having a high income should make anything cost more. Can you imagine walking into a car dealer and having them tell you that the car you like will cost more because you can afford it? That’s exactly what private universities say to parents with high incomes.
@iamjack Um… Unless you’re going to college in Podunk, USA, $900 per month for an apartment is really not that much. That seems to be the equivalent of a dorm at your typical over priced private university.