October 17, 2003


Bill Would Penalize Colleges on High Tuition Rises GREG WINTER, 10/17/03, NY Times)

[Howard P. McKeon, a California Republican and a senior member of the House Committee on Education and the Workforce] said his bill would create a government watch list of public and private universities that raised their tuition and fees more than twice the rate of inflation for three years in a row. If the offenders still did not curb their costs after another three years, they could lose their eligibility for millions of dollars in federal grants and programs under the bill. [...]

If the bill was in effect today, no fewer than 225 public universities, 470 private colleges and 625 for-profit trade schools would be placed on the watch list, according to the American Council on Education, an industry group. That is 24 percent of the nation's postsecondary institutions, the council said. House Education Committee staff members said the tally showed how rampant the problem of escalating tuition is.

"That obviously means that hundreds of schools are engaged in exorbitant tuition increases that hurt parents and students," said David Schnittger, a spokesman for the committee.

Gotta love the Feds--their subsidizing of college education for every half-wit in America is driving the price increases; so, what's their solution? Do they draw down the money that's causing the inflation? No, they try to add even more regulations.

Posted by Orrin Judd at October 17, 2003 1:12 PM

Mr. Judd;

While I agree federal subsidies for higher education is overall a bad idea, this regulation does precisely what you call for in the title: removing the money. It punishes the irresponsible schools.

Posted by: Annoying Old Guy at October 17, 2003 2:22 PM

It's not just the schools but we as a middle-class majority demanding entitlements who are irresponsible.

Posted by: oj at October 17, 2003 2:50 PM

AOG -- I'm not sure why you think that the schools are being irresponsible. They are reacting as any seller would to a change in demand. Demand is driven by the effective price faced by the decision maker: here, the student and parents. The underlying commercial transaction between the student and the school will not be effected. Instead, they will divy up the government payment between in a ratio that reflects their bargaining acumen and power (that is, the lion's share will go to the school). There is nothing about this that isn't entirely predictable.

It is equally predictable that the Congressman's remedy will not work. If price is artifically limited, then the schools will simply reduce the quality of the education in some way: pay professors less, squeeze more students into a class, provide less food in the cafeterias, reduce the number of campus security guards, not buy as many books for the library, etc.

Finally, because there are any number of mechanisms for financing education when it makes economic sense to do so, all government financing does is to subsidize those who don't need it or those who, through their personal limitations or the nature of what they study, destroy wealth through education. It's hard to get too upset about that.

Posted by: David Cohen at October 17, 2003 5:13 PM

"the nature of what they study, destroy wealth through education."

I think you've just described every English, Sociology, Ethnic Studies and Wymyn's Studies department in the country. And if colleges ever feel a crunch, these will be the last places to feel it.

Posted by: Raoul Ortega at October 18, 2003 4:23 PM

oj just doesn't get it.

If the government subsidizes the education of 2 half-wits, doesn't that mean that society gains the knowledge of one educated wit?

Posted by: John J. Coupal at October 20, 2003 11:39 AM