A vicious and unending cycle

As mentioned on last post,  I noted in the fashion insinuating that the government intervention is what to blame for skyrocketing tuition. 

It would be much idealistic if the federal government suddenly steps out of this secondary education sector and let other private sectors to jump in, creating "perfect competition". 

However, there are practical issues confronting the government intervention issue. 

Let's recap. 

Public four-year post-secondary institutions : 76 percent increase on average over the last decades.

Private four-year post-secondary institution: 62 percent increase. 


Another problem that can rise is that the speed of increasing tuition is clearly surpassing the rate of inflation, increase in income amongst middle-class family which is 5 percent. 

If government grant more aids, more student will head to colleges  = we might face the future where getting PhD is a social norm. 

If government steps back and let private sectors to compete = less students will pursue post-secondary degrees. 

If that happens, public institutions will lower their tuitions in order to prevent loosing students who are pursuing private institutions. 


But!! all those possible solutions bear one big problem that keeps this unsolvable cycle; what about people who are intellectually eligible without sufficient financial supports from their households??


The point that I'm trying to emphasize here is that the government intervention in college tuition wasn't intentionally aimed to correspond to skyrocketing tuition. It all started to purely "support"
students with very potential futures who are in need. 

But as always, once positively implemented policy is now has turned up by "business-minded" people, who are trying to make plethora amount of profits by taking advantage of the government intervention. 



So.... What are some REAL solutions when it comes to skyrocketing tuitions?? 


According to Dr. Fichtenbaum, professor at Wright State Univesrity and the president of the American Association of Univesrity  Professors, he claims that, actually, put blames on three distinct factors that are quite different from my previous condemnation.  In agreement with Dr. Fichtenbaum, he picks the first factor controlling price at public colleges is the decline in state support for higher education; between 1987 and 2012, statistically, government support has diminished from $8,497 to $5,906/ student (Fichtenbaum).

His statement is further buttressed by the fact that there has been a decrease in maximum AMT available from a Pell Grant for the last five years (solutionsforfuture).

Fichtenbaum's second factor is surprisingly, faculties salaries. 
But, don't be fooled, "When measured in constant dollars, salaries for full-time facutly at public institutions have actually declined." 

This can be explained by looking at University presidents, who act verisimilitude as CEOs' of multinational companies. 
It is a big business, and they don't seem to voluntarily stop earning profits when they can. 


Last but not least, rising costs can simply a result of growth in luxurious entertainments and amenities of universities. For instance, Penn State has just finished polishing up Burrows and Steidle. Universities borrow or have already borrowed millions  to attract students visionally by building luxurious dorms, new dinning halls, and not to mention subsidization of college athletics (Fichtenbaum).

In the end, he finally comes down to TWO solutions, which are extremely underlined by me. 

In order to reduce the federal presence in financial aid; 


1) reducing enrollments, the demand for higher education, lowering the ability of colleges to raise prices. 

By doing so, the pattern of reduction in size would lead universities to reduce its size, deducting administrative dues, and maintain the minimally required departments.

2) Cost-cutting ideas, such as three-year bachelor degrees or opening more online-based courses. 

In this way, universities can keep students motivated and likely to increase competition among them.  Eliminating quite pedagogical focus and freshly changing the aim to encourage students to demonstrate workplace competency. Nowadays, practicality and precision are required to survive in the saturated pool with influx of 2 million college graduates.

I have a lot of friends  in Canadian universities who are currently in Co-op program. 

Also, in Thailand, sponsorships from companies are very common and affective among Thai international students. 

Next week, let's change the scope and let's see how the world is dealing with the skyrocketing tuitions. 

Federal Aid, a double-sided sword

Have you ever had any problem that you don't know where to start? But surely recognizing its existence all the time? For instance, with the full realization of what I have done wrong after every presentation that I had, I simply couldn't fix my natural bad habits. Of course, I wish I could, but once again, have no idea where to begin. 

It might sound really odd, but the civic issue that I'm about to talk is quite analogous to that.

Even though we acknowledge that something is wrong with the rapid rise in college tuition, we simply don't know where all it started... 

Here are some clarifications... 

Ever since the government got involved with the higher education, it graciously entitled us to be bombarded with student loans and low possibility of living debt-free lives.

According to NCPA, 60% of college graduates end up with a minimum of $26,000 in student loan debt. Furthermore, during the 2013-2014 academic year, the amount of federal student aid reached $169 billion, aiding almost 9 million students across the nation. Basically, among st total undergraduate enrollment of 17.5 million back in 2013, 51% of them received any sorts of federal aids, ranging from a couple of hundreds to tens of thousands of dollars. From an international perspective, this phenomenon doesn’t seem to be a good omen at all. More government intervention in higher education, the more burdens on out-of-state students and international students’ shoulders.

But…. How in the world the government intervention is related to steeply rising college tuition?

As reported by the National Bureau of Economic Research, it found a critical relation between a huge increase in college tuition since 1987 and the increase in accessibility of student loans available by the federal government.

(Photo credited to writer, Dan Reimold)

The relativity between college tuition and governmental funding is also known as Bennett Hypothesis, a man who foresaw the current situation 25 years ago. In 1987, a secretary of Education William Bennett proposed the idea of increase in financial aid would inevitably backfire on college students no matter what. All blames must be put on two distinct goals set by the federal government: 1)every American must be accessible to education, and 2) all loans must not be dischargeable. 

The federal government is binding American college students under freedom education, but in fact, pushing them on the verge of cliff called student loans. Since the government is indiscriminately supplying money to aid students, numerous colleges and universities, clearly business organizations have no reason not to rais the tuition, due to unconditional payment from the students. The real sacrifices to this cycle of intervention are out-of state students and international students. For instance, while a normal inner-state American student pays $18,000 at the most, out-of-state and international students are paying as few as $30,000 and as many as $50,000. It is even worse for them who are not eligible for any kind of grants or federal aids except the institutions' own merits. 

My main point is that if the federal government withdraws from regulating tuition in higher education, other private corp orates will take its place. And due to the existence of competition in a capitalist society, college tuition will likely to go down. 

For instance, if the computer or telephone industries were solely controlled by the government, we would have been paying much higher prices for laptops, cell phones and wireless since there is only one company who sets price without threat of competition. 

Senator Ran Paul once quoted that if government steps back away from any economic activities, we, college students, would be paying the amount people paid back in 1980s. 

Fortunately, this world isn’t all that bad. There are some suggested solutions to this phenomenon.

A. Either convert student loans dis chargeable again, or limit the amount.

B. Above will result increase in competition among students to borrow money from private banks.

C. Thus, tuition will likely to diminish. And a good portion of students will less likely to come to colleges without sufficient amount of aids.

So next time, I’ll take a closer look in relations to practical approaches by any institution or Bureau of Education.