{"id":825,"date":"2022-12-29T00:00:00","date_gmt":"2022-12-29T04:00:00","guid":{"rendered":"https:\/\/bohn.org\/wpmocha\/peanutgallery\/?p=825"},"modified":"2022-12-28T20:34:11","modified_gmt":"2022-12-29T00:34:11","slug":"so-long-as-their-goal-is-to-maximize-revenue-colleges-will-never-be-truly-affordable","status":"publish","type":"post","link":"https:\/\/bohn.org\/wpmocha\/peanutgallery\/2022\/12\/29\/so-long-as-their-goal-is-to-maximize-revenue-colleges-will-never-be-truly-affordable\/","title":{"rendered":"So Long As Their Goal Is To Maximize Revenue, Colleges Will Never Be Truly Affordable"},"content":{"rendered":"\n

A college education is expensive, and that expense far exceeds the rate of inflation.((See, for example, footnote 1 of Economics 303: Demand-Side Subsidies and Higher Education<\/a><\/em>: \u201cBetween 1978 (the first year in which college tuition had its own CPI category) and the third quarter of 2017, the price of tuition and fees increased by 1,335 percent. This rate of growth exceeded that of medical costs (704 percent), new home construction (511 percent) and the Consumer Price Index for all items (293 percent). [citation and footnotes omitted]\u201d)) Student loans do not make a college education affordable; they merely defer and spread out the pain over time. We should all be more concerned about the actual sticker price and avoid feel-good subsidy programs that merely push it up. As I said before<\/a>: “Imagine a carrot on a stick attached to a horse, but out of reach. Any effort to address the affordability of higher education solely or primarily by giving money to its consumers to pay whatever the sellers (that is, colleges and universities) choose to charge, is rather like expecting the horse to be able to run fast enough to get the carrot.”<\/p>\n\n\n\n

In his recent USA Today<\/em> article, “What happened to Biden’s free college plan? Cutting cost of higher ed out of feds’ reach<\/a>,” Chris Quintana says: “The way the U.S.\u00a0pays for higher education is not working.\u00a0“After mentioning a few examples of federal student loan relief, the author concludes “None of these measures addresses the upfront cost of college that students, and in some cases their families, confront, in part because the federal government has limited ability to push prices down.” <\/p>\n\n\n\n

That is key. A college education will only be affordable if the sticker price is realistic.((Quintana seems to agree that price is the problem: “States typically\u00a0provide\u00a0the majority of funding for public institutions, but in recent decades, state lawmakers have cut higher education appropriations to help balance budgets. And private universities can set tuition at whatever they think people are willing to pay for smaller classes, social connections and prestige.”)) As I have previously asserted<\/a>, government subsidies only encourage schools to increase their prices.((I believe that teaching is not the primary goal of most universities, but it is rather research or some other prestige. Professors who are only good teachers are less likely to be rewarded than those who make news (or money) with research and other activities.)) <\/p>\n\n\n\n

The federal government conditions receipt of federal funds by colleges on many policies and actions by the school. One of these should be an affordable price. If a school equates its tuition level with prestige, it is free to do so, but taxpayers should not be asked to subsidize it.<\/p>\n\n\n\n

Jay Bohn<\/p>\n\n\n\n

December 29, 2022<\/p>\n","protected":false},"excerpt":{"rendered":"

A college education is expensive, and that expense far exceeds the rate of inflation.((See, for example, footnote 1 of Economics 303: Demand-Side Subsidies and Higher Education: \u201cBetween 1978 (the first year in which college tuition had its own CPI category) and the third quarter of 2017, the price of tuition and fees increased by 1,335 … Continue reading “So Long As Their Goal Is To Maximize Revenue, Colleges Will Never Be Truly Affordable”<\/span><\/a><\/p>\n","protected":false},"author":6,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5,4],"tags":[],"class_list":["post-825","post","type-post","status-publish","format-standard","hentry","category-economics","category-government"],"_links":{"self":[{"href":"https:\/\/bohn.org\/wpmocha\/peanutgallery\/wp-json\/wp\/v2\/posts\/825","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/bohn.org\/wpmocha\/peanutgallery\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bohn.org\/wpmocha\/peanutgallery\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/bohn.org\/wpmocha\/peanutgallery\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/bohn.org\/wpmocha\/peanutgallery\/wp-json\/wp\/v2\/comments?post=825"}],"version-history":[{"count":2,"href":"https:\/\/bohn.org\/wpmocha\/peanutgallery\/wp-json\/wp\/v2\/posts\/825\/revisions"}],"predecessor-version":[{"id":827,"href":"https:\/\/bohn.org\/wpmocha\/peanutgallery\/wp-json\/wp\/v2\/posts\/825\/revisions\/827"}],"wp:attachment":[{"href":"https:\/\/bohn.org\/wpmocha\/peanutgallery\/wp-json\/wp\/v2\/media?parent=825"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bohn.org\/wpmocha\/peanutgallery\/wp-json\/wp\/v2\/categories?post=825"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bohn.org\/wpmocha\/peanutgallery\/wp-json\/wp\/v2\/tags?post=825"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}