Jessica Wheeler
Professor Jones
GSW 1110
10 November 2015
Curbing The Rising Cost of college
The cost of college has become a major problem for students and parents alike. Tuition cost and fees for private schools in 1973 averaged $10,783 in 2013 dollars (Keenan n.p.). In 2014, the average cost of tuition and fees had risen to $30,094 (Keenan 2), while tuition at public universities has quadrupled during the same period to $9,139 (Campos 1). If the price of automobiles rose as quickly as college tuition, a new car would cost an average of over $80,000 (Campos 2)! If there is no end to the rising cost of higher education in sight, there are solutions that can make education more affordable.
The purpose of this paper is to explore the reasons for escalating college education costs and provide some realistic solutions to correct the problem. Specifically, the following areas will be covered: analysis of school costs, factors contributing to escalating college costs, and provide a realistic solution that can result in lower costs for students, parents, and the Federal and state governments. In this paper, I propose that the government reduce grant funding to students with a 3.0 grade point average (GPA) or higher, while increasing funding to 100 percent for students below a 3.0 GPA to help redistribute demand for high cost education. This solution will help existing government funding for higher education go farther, while also providing an incentive for colleges and universities to lower their college costs.
Tuition is usually determined by each individual school administration and can be influenced by whether the school is public or private. “As a general rule, studying at private colleges costs four times as much as studying at public colleges” (College Education Costs 1). For example, New York University (a private institution) costs $44,845 annually, versus Purdue University, which costs a more reasonable $9,992 for an in-state resident (College Education Costs 1). This cost can also be significantly different for out-of-state verses in state students. For example, Bowling Green State University in Ohio, charges residents $10,726 and $18,034 for non-resident students (College Education Costs 1). The difference between in-state and out-of-state residency can significantly impact the cost of a college education.
Housing is another major expense that contributes to a higher than expected cost of a college education. According to an article in an online magazine, University Language Services, titled “US College Costs and Tuition”, reported, “The average annual housing fee for a four-year private US college is about $9,000. Housing at a four-year public college costs about $7,000.”
Demand for a college education is the main cause of rising college costs. This demand is created by the availability of money for students that are obtaining a college degree and employers degree requirements for many positions. This causes a greater number of students to choose higher education as a way to make more money over a lifetime of employment. “Enrollment in undergraduate, graduate and professional programs have increased by almost 50 percent since 1995” (Campos 2). During this same period, state appropriations exceeded $81 billion as of 2014, with Pell Grants exceeding $34.3 billion (Campos 2). Even though student populations rose nationwide, the dollars spent per student is actually less than in 1975 (Campos 3). In short, “The pursuit of education has turned into a vicious circle in which students need bigger loans to pay for higher costs, and colleges charge higher costs because students are getting bigger loans” (Keenan 3).
Demand for a college education is not going to decrease for the future and educational institutions are allowed to set any price to attend their schools as deemed necessary. I propose changes in the law to redirect dollars where they will do students and taxpayers the most good. The concepts of demand and supply mean that a business can only set prices at or just below what the market will bear. My solution is based on distributing dollars to influence students with a lower GPA to seek education at lower cost institutions for the first two years, until they can demonstrate the ability to maintain a 3.0 or higher GPA and only then would be allowed to receive additional funding to continue their education at a typical four-year institution. Colleges and universities charge higher prices because demand for education is high (Keenan 3). I propose changing the law so that Federal aid will only be provided to students wishing to pursue higher education with four-year schools, provided they demonstrate a high school grade point average (GPA) of at least 3.0. Students with a lower GPA could only get Federal funding for Junior or Community Colleges. This would allow Federal funds to go further, while still providing an opportunity for underprivileged students to get a quality college education. This would also decrease the demand to four-year institutions, and possibly encourage those schools to lower their tuition, fees, and housing rates to be competitive for the fewer students that could still afford to attend these historically expensive schools.
“In the period between 1970 and 2013 as a whole, those with a bachelor’s degree earned about $64,000 per year and those with an associate’s degree earned about $50,000 per year, while those with a high school diploma earned only $41,000 per year” (Abel & Deitz 2). If there was a promise of getting a free education at a community or junior college, lower income students might reconsider their decision to pursue a degree more carefully. If there are a higher percentage of students getting a significant portion of their education at lower-cost institutions, the availability of money for those pursuing an education at four-year institutions will increase. Since students with a lower GPA out of high school have access to free education to the award of an associate’s degree, less money would be needed in the form of student loans. This could also reduce the student loan default rate. Students with lower GPAs will have more time to adapt to the college environment and therefore, dropout rates could significantly decline, providing a better return on investment for taxpayers.
College costs since 1970 are paying more, but the return on investment of a college education is still worthwhile (Abel & Deitz 1). There has been an increased demand since the Great Depression, fueled by federal and state grants and ever increasing educational loans has influenced some of the cost increases. While students can take positive steps to keep costs down, such as attending an in-state school and choosing a public over a private school, these personal choices do not help the taxpayer burden. My solution of using Federal funding to influence students, that might be least likely to do well in a typical four-year school, to select a junior or community college for the first two years free of charge. Hopefully it would allow existing funding to benefit more students. If the students decide not to continue their education beyond an associate’s degree, statistics show their average earning potential will be significantly more than high school graduates. If the students with lower GPAs successfully complete junior or community college and decide to continue on to obtain undergraduate degrees with a four-year institution, they would still have access to existing state and Federal Grants and would potentially have a lower student loan bill, potentially resulting in lower student loan default rates.
Works Cited
Abel, Jaison, & Deitz, Richard. “Do the benefits of college still outweigh the costs?. Federal Reserve Bank of New York current issues In Economics and Finance. 2014.
Benlkin, Douglas. “How to Get College Tuition Under Control.” WSJ. N.p., 8 Oct. 2013. Web. 8 Nov. 2015.
Campos, Paul F. “The Real Reason College Tuition Costs So Much.” The New York Times. The New York Times, 04 Apr. 2015. Web. 8 Nov. 2015.
“Cost of a US Education.” The Campus Commons. N.p., n.d. Web. 8 Nov. 2015.
Keenan, Ronan. “What’s Behind America’s Soaring College Costs?” The Atlantic. Atlantic Media Company, 10 Apr. 2014. Web. 8 Nov. 2015.