I've been a college-tuition-paying parent and a tuition-charging college president. As a parent, I gasped at the bills. As a president, I wondered how I could possibly make ends meet. I've seen it from both sides now, and so let me provide you with a New Jersey response to the complaint that college costs too much.
Shaddup. Or, borrowing from the Bronx, Fugetaboutit. This is the best bargain you are ever going to enjoy. Send in that tuition check with a Cheshire-cat grin because higher ed is your bowl of cream at a skimmed cost.
First, choice and competition. There are thousands of colleges and universities of every imaginable kind in every burg in the United States -- and at every price level. The choice is dazzling. Compare it to the number of bar soaps or car models, versions of Beethoven's Seventh or religions. It's a buyer's bazaar, and its spectacular variety is one reason it's the only aspect of our educational system that is the envy of the rest of the world. The real best: no other nation comes close. That's refreshing for once.
It's also a buyer's market. The status-conscious neighbors may have tricked you into thinking Junior must compete to get into the top few prestige colleges or universities, but below this very high line, and often offering every bit as good an educational experience, exist the other 95 percent of institutions that are more anxious about attracting enough students than about picking a chosen few. And especially at the more expensive privates, you can bargain aggressively for your price because the competition for students is fierce.
Speaking of price, there is retail and net, and almost no one pays retail. Most students are eligible for one or another form of student aid, and at many universities as much as half of tuition revenues get recycled as scholarships. Add to that the donated scholarships and the hefty sums that come from that savings account called endowment, and even full-pays get more than they give. A typical college or university will supplement its annual expenditures with perhaps another 20 percent from the endowment, and that is a bonus for all students.
Once all of that happens, the low cost of college is nothing short of extraordinary. According to figures compiled in 2011 by the College Board Trends in College Pricing and referenced by the well-regarded expert Sandy Baum in the Spring 2012 ACE Presidency journal, once you figure in all the aid, the average yearly tuition at a public university is $2,500 and then $13,000 at the typical private college.
Okay, but my kids seemed to be allergic to scholarships and I paid a good deal more. Imagine you spend, as I did, $35,000 tuition, fees, and room and board to send Junior to an expensive school. This is not a negligible sum, though you need to remind yourself that this was a choice, that you could have determined upon a perfectly satisfactory alternative for a fraction of the price. Even so, for that $35,000, think of what your offspring receives. She is treated to many classes with 15 or fewer students, given immediate, personal access to experts in every major field of human endeavor; provided with individual mentoring to her heart's content, offered free entrée into a hundred different interest clubs; invited to presentations every day and night of music, theatre, dance, art; handed a pass to superb athletic facilities and opportunities to participate in 15 or 20 sports; afforded housing and food choices an earlier college generation would die for; and guaranteed lifetime friends, including some who will actively aid her career endeavors. Annual fees for your country club -- swimming, golf, so-so food, zilch culture, no lasting benefits whatsoever, and the same old crowd -- cost what, again?
In contrast, the claim for the pecuniary value of a college education has been $1 million, that is a million dollars difference in salary over a lifetime. Not bad for an investment of, say, even $100,000, a 10-to-one leveraging. It's better than free. But is that still true given the current spate of news articles about unemployed new graduates?
In fact, it is more true than ever before. These stories typically trumpet the fact that students six months out of college may be unemployed or trivially employed. But what did most people always do after college? They screwed around for a year or two. More important, the unemployment figures from the recent recession make a still stronger case for college. The unemployment rate for BA degree-holders peaked at 4 percent, well less than half the figure for high school grads, while those who didn't finish high school were high-teens unemployed. The data that really matters makes it plain -- college equals job, and in fact much better job.
The other current knock on college costs is more serious, and it concerns students graduating in debt, sometimes to the level of $25,000. But as Baum points out, the more accurate characterization is "investment." How much "debt" is constituted by a house mortgage? How much profit -- or, nowadays, loss -- will accrue from that, compared to the extra million, or (according to others) 80 percent additional annual income, from a college degree? Thank you.
Now just a minute, I'm sure I've forgotten something. Oh yes. Your mind and soul, that was it. This college education has the capacity to make you a whole person. It enlarges the tiny self -- perhaps six feet tall in the immensity of space, living for seven or eight decades in the eternity of time -- to link with the entirety of human experience. When I became a university president, my very young son asked me what we made at the university. I replied, "Great people." We seek to develop individuals who understand they must engage different views before coming to a conclusion, who can argue civilly and instruct others effectively, who can write not just clearly but expressively, who can test theories and ideas, who can discover and develop a discovery into a concrete reality, from a great new song to a means for exploring Mars. College fosters strong individuals who can think independently but who also know how to look at other, even and especially opposing viewpoints fairly and with empathy. (I admit the first paragraphs of this blog may not illustrate such cognitive generosity perfectly, but hey -- we're having fun. I know better.) Democratic society is utterly dependent upon such developed qualities. And in a time of competing values and dramatic differences among people, at its fullest a college education is nothing less than the hope of the world.
In truth the only exorbitant cost of college consists in not attending one.
Awright!, as we also say in Jersey. That felt really good. Now every so often for the next year, I am going to tell you and you are going to tell me what is dangerously amiss in this magnificent but deeply flawed system of American higher education. And then together we are going to fix it.
Dr. John Ebersole: Why Does College Cost So Much?
Nancy L. Zimpher: A Risk Worth Taking
Also, as a former high school teacher in a high needs school, I must lament that our public education system offers zero financial guidance to high school students. As a result, many intelligent and capable students who are the first to attend college in their family are given no guidance in managing the financial complexities of obtaining a college degree. It is unconscionable that students can take out $40,000 a year in loans without ever being given a readout of what their monthly payments will look like at graduation.
$25,000 in debt is modest in 2012. The upper end is more like $100,000 for a four year degree and double that for an advanced degree. It is like starting life with a mortgage payment just to cover your education.
You baby boomers had it good. State schools were very affordable and government grants helped pay that. You have no idea what a burden starting out adult life with a huge debt load is for many of us.
Most state schools give very little in grants or scholarships. Going to a state school in a different state will usually run $ 28K to 35K in tuition, room, board, fees, etc., per year.
Yes, college is a great investment. But the boomer generation got away with relatively low cost education, but now legislators (made up of that generation) have withheld state funding for higher ed., so this generation has to pay substantially more. Yet another example of the Boomer generation with its me-first attitude, sticking it to the younger generation. When will they be done robbing us??
Yeah, $1 million ON AVERAGE: for every banker making $100 million more over his lifetime there are 100 art majors working at starbucks. It really depends on the field you're majoring in, even so you should remember that there are universities in Europe that offer the same quality for less than half the money (if you are an EU citizen), even when factoring the taxpayers' contribution because they don't have board members making millions, nor do they have shareholders. For profit education is a giant scam.
It is certainly an investment, but like any investment it's also a risk. Maybe someone whose parent is a university president can afford to "screw around" for a couple years before they finally land a job, but for the rest of us, if you don't find a job within 6 months you risk defaulting on loan payments. This may not always be a risk worth taking. I believe that, with my scholarship, my Drew education was a worthwhile investment and a sensible risk to take. At full price it would have been a poor choice.
My point is that anyone who doesn't come from a country-club family (i.e. almost everyone) needs to consider that it might be a good idea to give up that small liberal arts school they fell in love with in favor of a less risky state or community school. "Give up your dreams if you can't afford them" may sound coldly practical, but if you don't have a huge financial safety net, practicality should be your guiding principle. I wish more university administrators were dispensing this wisdom instead reassuring rich families that their money is being well-spent.
The costs of a degree have increased rapidly. Indeed, there is serious discussion as to whether the cost of a medical education is now so high as to make the economic return for primary care physicians working reasonable hours a rational economic proposition.
I would not send kids off to a 4 year college or university for a traditional program. Rather I expect them to earn credit via AP exams and do Running Start / Community College for their first 2 years of their general education.
Then they can go on to universities to complete their education - either as commuter students (if possible) or on-campus students (if needed). Cutting the cost of college in half does great things for the return on investment.
Historically $1M MIGHT have been the case, but I'd not be so sure in the current economic climate.
And even that figure is unrealistic. How much of it is produced by high paying occupations like engineering, and how much is further increased by people entering professions like medicine? Not to mention the likelihood that the supposedly smarter and more motivated people that finish university would proably earn more even anyway, so its a mistake to attribute all of that income to university attendance. Conversely, there are occupations (like teaching) that require degrees yet are woefully underpaid.
And it completely ignores one of the fundamental costs economists consider: lost income during university. That alone could double the REAL cost.
That will provide me not only with choices of employment but with a head start not sitting in a hole.
I don't think students should be buying things they can't afford. That's how e got in this mess in the first place!
Chase
Drive and determination are 80% of the battle and will carry one a long way...