I've been fairly lucky. College has not really cost me a whole ton of money. In fact, by the time I'm done with college, I probably won't even rack up $15,000 worth of student loans. But that's the beauty of attending the University of Houston, which despite the lack of cultural and educational recognition in comparison to the two institutions located in Austin and College Station, the school provides the best bang for your buck in post-secondary education at least here in Texas.
I've heard three arguments about the cost of collegiate education and what to do about it -- one from Presidential candidate Ron Paul, one from PayPal founder Peter Thiel, and another from Mark Cuban.
Ron Paul, in yet another item he attributes the federal government for fucking up, claims that federal government involvement has driven up the price of tuition at colleges. His general argument is that because of governmental involvement in the subsidizing of education, it has allowed colleges to raise tuition to outrageous levels. Paul is advocating for the divorce of government and education because of his strict interpretation of the U.S. Constitution.
Thiel, in an interview with the conservative publication The National Review, opined that education is merely another economic bubble that is waiting to burst. He took it from a business standpoint for he believed that collegiate education had little return on investment. I would assume this comes from the fact that a lot of students emerge from college broke, up their neck in debt, and many times do not find jobs right away in the degree that they spent four, five, and six years working on.
Cuban wrote in his blog that student loans should be capped at $2,000. He feels that it would lead to a decrease in tuition costs because he thinks that the amount that can be secured by students through loans allows for colleges to charge more and more for tuition.
The cost of tuition has skyrocketed so much to the point where student debt has overtaken credit card debt to become the biggest debt crisis in the United States. In fact, the total amount of student debt in the United States has cracked $1 trillion. Ouch.
There's three reasons why most of us go or went to college -- one, we believe(d) that it is the only sensible path to a much more comfortable living; two, because our parents, teachers, and other peers instill(ed) in us the value of college, or three, both of the aforementioned reasons. It's especially true now as more and more people go to college than ever before.
There has been a major culture shift in the United States and the rising cost of tuition reflects that. However, I would stop short of saying that a supply-demand curve could be applied to it because any sort of equilibrium price that would exist is absolutely imaginary. As the United States transformed from mainly a blue-collar economy to a more service and information economy, businesses that specialized in providing services and information put more and more stock in having a collegiate-educated workforce, which spurred a greater demand for post-secondary education, which in turn led a rise in tuition as colleges had to find a way to pay to provide for more students. Not to mention, colleges and universities have seen a decrease in funding from state government since the 1970s (thus putting the burden of educational funding on the federal government), which led to even greater rises in tuition as enrollment continued to increase. While many students (including myself) still turn to the federal government loans for financial aid (which accounted for over 60% of financial aid that 2007-2008 graduates received), most higher education institutions are relying on additional private sources (donations) for funding in addition to tuition.
In short, I do believe that out of control tuition increases would have occurred even if the Higher Education Act of 1965 was never signed into law by President Johnson. I think more than anything the perceived value of higher education, through changes economic climate, drove up tuition costs. As higher education institutions started to cater to more students these institutions became more driven to provide more for their students, if it was by way of better residential facilities, better on-campus technology, better educational talent, better degree programs, or even additional degrees being offered and awarded.
So in response to each of the arguments:
I vehemently disagree with Ron Paul about blaming government intervention with rising tuition costs. Tuition was already rising in the 1960s as it is and as the economy transitioned away from blue collar jobs to service and information jobs, thus adding more value to post-secondary education, the explosion in the cost of tuition was going to happen regardless of whether or not the federal government stepped in and started subsidizing college students' education. Ironically the free market champion can actually blame the market: as the United States increasingly de-industrialized the economy as the information revolution started to take hold in the 1980s and 1990s, it sparked a movement amongst students to enroll in community colleges and four year universities to even remotely have a chance a comfortable living. And even then for many that has not proven to be a reality.
I also disagree with fellow libertarian Thiel, who fails to get that there's no real such thing as a legitimate, quantitative return on investment on education because any perceived return on investment is subjective. Literally, someone who went to college, from undergraduate to medical school and residency, totaling 12 years in college could say that they had a poor return on investment on their education if they questioned the value of making $160,000 a year yet be saddled with nearly $130,000 in student debt while someone else could be in the exact same situation and argue the opposite. Furthermore, education isn't a bubble -- if the only real way to make a decent living in today's service and information economy is to acquire the necessary knowledge to participate in today's service and information economy then students are going to turn to robust higher education.
I also disagree with Cuban for virtually the same reasons as I disagree with Paul: collegiate tuition rose because more students started to find more value in education as government funding for it (especially from the states) decreased for it. Like I said, even if the Higher Education Act of 1965 was never enacted, tuition would have still skyrocketed at a faster rate than inflation because of the transition away from a blue collar driven industrial economy.
Furthermore, I think what has to be analyzed, in my opinion, is what should and what shouldn't higher institutions of learning should force students to pay for and what should or shouldn't higher institutions of learning be providing for. How much should faculty really be paid? How much money do schools really need to function? Those are the questions that we really have to be asking before we can really start a discussion on how to lower the cost of tuition here in the United States
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