The "High Tuition/High Financial Aid" Model Only Works If You Provide High Financial Aid

Comments

1
Part of the realization that there is no more middle class -- as in a broad base of households among whom "the wealth" is shared is that all of our taxation systems are garbage.

What's the point of taxing a guy with two pennies to give another guy a penny when the cost of living is a dollar, and 3 percent of the people have a hundred dollars?

2
Well the Baby Boomers had the advantage of cheap state universities, paid for by the sacrifices of their parents and grandparents taxing themselves to pay for it. Then in typical fashion we( sadly I am one of this no account generation) couldn't stand to pay taxes ourselves and cut future generations out of that deal.
3
@3 Thanks for that.
4
You're right Goldy. It is High Tuition and Maybe We'll Get Around to Increasing Financial Aid, and if it is passed into law, our universities will lose the few middle class students they have left, as well as many of the lower class students who still won't receive enough financial aid to cover the costs of university.

Right now, Washington State has something like a 19% participation rate in higher education, meaning 80% of our kids don't go into any kind of higher education. Now, we're going to make it even more expensive, driving that number into even worse territory.

The other thing is Governor Gregoire called for this same thing last year in her State of the State address. Then, she called it Tuition Flexibility.

The Legislature can't fund the Financial Aid our state currently offers. They cut almost half of the Financial Aid programs we offer last year, and most are on the chopping block for this year. Why on earth would anyone think we could increase financial aid to meet this coming increase in tuition?
5
I'm curious about the number of out-of-state residents enrolled in Washington schools and if those numbers have stayed steady or increased since the mid-90s.
6
The best financial aid is low tuition. The high tuition/high aid model leaves out too many students, especially in areas with higher cost of living, like, oh, Seattle. And it erroneously presumes that all parents are eager to pay what they can to educate their children. Many parents can't afford the estimated family contribution or could care less, leaving their children to either take out huge loans, live like paupers or both.

The costs are too high if a summer job and part-time employment during the school year can't cover tuition, fees, books and reasonable room-and-board at a state school. Bring back the huge subsidies for higher ed. The poor and middle-class students deserve them, and the wealthier parents should get a chance to recoup a little of what they pay in taxes.

7
@5 the UW student news paper has an article about 2010 applicants only, but it's a bit telling.

http://dailyuw.com/2010/3/12/undergradua…
8
Oh, God! Another post from this insufferable windbag!
9
Hmmm. Does this model he proposes survive engagement with reality?

That is, do students who enter school debt-free and at the same socioeconomic level graduate with the same amount of student loan debt, whether they go to Yale or Michigan State?

My guess is no, the former carry much higher debt burdens than the latter. But why actually, you know, look at results in the form of data when neat models are available, allowing you to wind into a post some really absurd point about socialism?
10
"Bring back the huge subsidies for higher ed."

Um, when did they end?
11
NEXT! @9,

You can presume all you want, but as of 2009, Penn (and I believe the other Ivy League schools) has eliminated student loans from its aid portfolio. Thus, regardless of income, students will not graduate with debt. The facts are the facts.

But, all this comes with a huge caveat. This model can only work if it comes with an adequate commitment to funding financial aid.
12
Excellent article, Goldy, but you haven't mentioned the underlying and fundmanetal point of it all (as some of those highly well-informed student protesters did at UC awhile back):

it is the securitization of college loans, and student aid which, like those CDOs and zillions of other types of credit derivatives in residential loans, commercial loans, auto loans, credit card charges, etc., etc., etc., profit the banksters by the continuation of their peddling securitized debt (debt-based financial instruments), hence all those debt-financed billionaires, while shoveling their debt onto the rest of us (while they convenient, unethically and amorally hold onto their ill-gotten "profits").

That's all it is; has nothing to do with education or anything else, for that matter.

Good post, Goldy.
13
@6 - Thanks, that is interesting. When I was at Evergreen, it sure seemed that, as a freshman, most of the students were from out of state, and most of the resident students were from small towns. I imagine that depends on the applicant pool.
14
The problem with college is that the costs keep skyrocketing, largely due to the ability to get people to foist larger and larger student loans upon themselves (@ 12, wall street was a big part of this problem). As the willingness of students to come out 100k in debt for a poli sci degree decreases, colleges will be forced to get there cost structures in order. (See the UC system's pension programs for 100k+ administrators profiled in the SF Chron last week). I'm afraid that a big aid program would only delay the necessary cost containment measures.
15
@14- A very good point. The limitless student loan credit available to students means there is very little reason for schools to do anything to control costs. And it means banks get access to permanent income supplies in the form of people who can not go bankrupt. Everyone (who's a banker, tenured professor, or college administrator) wins.
16
Here's a suggestion: Instead of chasing athletic scholarships with endless select sports teams, tell your kids to work hard in high school, get great grades and get into a top-tier private college -- and not just the Ivies. A lot of those schools have aid to give, and you can end up getting a top-notch education (without the 600-student lectures and overcrowded dorms of large universities) while paying no more than you would to go to WSU or Western.
17
The continued hollowing out of the American Middle Class is just going to accelerate.

Few among us have the fiscal discipline needed to do what you have to so that your kids and yourself stay in the middle class - live in a cheaper neighborhood than you can afford, save and invest (not bonds or money market, but stocks at the cheapest expense ratio like 0.2 pct) 10 to 20 pct of your income, and put your kid(s) thru college without burdening them with debt for the first four years (grad students can get jobs to pay for their education).

When I will look back on this failed century of the American Fall, from my retirement homes in Vancouver BC and Paris, it will be with sadness that Americans are such sheep.
18
#14 (Dwight Moody) you are CLUELESS, go back and re-read my comment (your comment on my - #12 - comment is rather nonsensical -- of course I was stating that Wall Street is THE PROBLEM, as securitization is the frigging cost driver in housing costs, auto costs, student tuition costs, commercial real estate costs, and most certainly the healthcare sector costs, as the three primary cost drivers in American medical costs are:
(1) healthcare hedge funds which speculate on ALL areas of the healthcare sector (utilizing ultra-leveraged speculation via securitized financial instruments (i.e., securitized debt);
(2) private equity firm leveraged buyouts on all areas of the healthcare sector (utilizing structured loans, i.e., securitized debt); and,
(3) criminal behaviors by criminal corporations such as Pfizer, Eli Lilly, HCA, Cigna, Merck, etc.

Of course, Wall Street is the frigging problem: the peddling of modern day snake oil, that is, securitized debt, creates all those criminal debt-financed billionaires who own the flipping US Congress.

Try to catch a clue.....