College Costs: The Dishonest Conversation (1)

September 25, 2012

We are having a deeply dishonest conversation about college costs in this country, and we’re likely to go on having this dishonest conversation for the indefinite future.  No one seems prepared to put a stop to it.

Why or how dishonest? Because we’re all acting and talking like (1) everyone should go to college, and (2) someone else should pay for it.  Colleges and universities charge high prices.  Parents and students expect to get financial aid to pay those tuition bills.  The federal government is not increasing what it provides for grant aid.  States are decreasing what they provide.  Banks continue to press for special rules on student loans to insure that they get paid no matter what.  And meanwhile, the families of those students seeking admission are increasingly resident in the lower brackets of the American income distribution.  The system is broken and the cracks are more and more apparent.

The dishonesty is compounded by initiatives that point in the wrong direction.  Maybe students and their parents just don’t understand the true costs of college is the premise behind one initiative.  Let’s be sure they find out.  Maybe they’ll choose more affordable institutions.  And thus is born the federal government’s requirement of a net price calculator.

Fine, but lack of transparency isn’t the main problem.  The main problem is that too little money is being devoted to the essential investment in a college education for all young women and men.  The costs of providing that education are beyond the resources of most families; they need assistance from someone.  Meanwhile, federal and state governments are backing away from support.

Colleges and universities have been compounding the dishonest conversation by increasingly shifting their financial aid away from need based aid towards ‘merit’ aid.  The scare quotes are essential: colleges are directing most of that aid towards young people from higher income families.  ‘Merit’ is just a label (often cynical) they put on that aid.

‘Merit aid’ has been an offensive weapon for decades in the competition for students in the higher education marketplace, but like many weapons, this one loses its edge as more and more colleges adopt the practice.  One result has been to open up a chasm between sticker prices and actually charged prices.  Another result has been to lead students and their parents to believe ‘merit’ aid is an entitlement.

On this latter proposition we get confirmation this week from a study just released by the College Board and the Art and Science Group.  Together they publish a newsletter called  studentPOLL, which this week reports that “Implementation this year of the required Federal net price calculator and the many intensive efforts of colleges and universities to educate and inform students and families about the real costs of college appear to have been ignored or missed by a substantial portion of the college-bound population.”

What especially attracted my attention, however, was the following conclusion:

“These data suggest that the merit scholarship arms race may very well have created a very strong and pervasive sense of entitlement on the part of the current generation of students, even among those with lesser academic ability as well as those with greater need. In fact, on average, students expect their financial aid award (excluding loans) to cover 50% of their college costs with students from lower income families expecting aid to cover an average of 64% of college costs compared to 52% of costs for middle income and 35% of college costs for students from the most affluent families.”

More, soon on the dishonest conversation about college costs.

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About Doug Bennett

Doug Bennett is Emeritus President and Professor of Politics at Earlham College. He has a wife, Ellen, and two sons, Tommy (born 1984) and Robbie (born 2003).
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