Why has college gotten so expensive in the last 30 years? A blank check in 1993 • Hacker News Board

Re: Why has college gotten so expensive in the last 30 years? A blank check in 1993

#181

Post by graeme » Tue, Sep 01, 2020, 9:40 PM UTC

throwawaygh wrote: post #38

apsec112 wrote: post #23

Earlier quoted context omitted.

Cuts in state funding don't explain the rapid tuition increases at private universities.

I know first-hand that this is not how pricing decisions work at regional private colleges/universities. The process regional private colleges go through is as follows: 1. List a set of "peer institutions", usually with the primary input coming from admissions. Here, "peer" means "competes for the same set of students we're after". Almost always the region's public colleges and universities will be on this list. 2. S…

Yeah but this only works if students have the money to pay for it. The loans ensure they do.

Re: Why has college gotten so expensive in the last 30 years? A blank check in 1993

#182

Post by mjn » Tue, Sep 01, 2020, 9:41 PM UTC

ummonk wrote: post #171

twic wrote: post #129

Earlier quoted context omitted.

Has the inflation-adjusted cash value of that support decreased, or the fraction of the costs it covers? "80%" and "20%" makes it sound like the latter. Because if it's the latter and not the former, the cause isn't declining support, it's increasing cost.

The latter. We've seen an increase in cost of education (as evidenced by private school tuitions, which have gone up and never had taxpayer support). In addition to this, student enrollment has increased, so per-student taxpayer funding has not kept pace even as taxpayer funding for public universities has gone up relative to the overall population.

In some state university systems the inflation-adjusted total funding has actually decreased.

For example, the University of California system was budgeted about $2.1 billion in state money in 1990, which is $4.3 billion in 2020 dollars. At the time, there were 9 campuses, serving 125,000 undergraduates, in a state with population 30 million. Fast-forward to 2020, and the system is budgeted $3.9 billion in state funds, which have to cover 10 campuses, serving 225,000 undergraduates, in a state with population 39.5 million.

If state funding had kept pace solely with inflation and state population, not taking into account any above-inflation cost increases, or the increase in percentage of high-school students who go to college, the budget in 2020 ought to be $5.6 billion instead of $3.9 billion, about 45% higher. If it had kept pace with both the number of students and inflation (but still no cost increases), it'd be $7.7 billion, or almost double.

My read of why it's been cut isn't that CA politicians really think the UC isn't worth funding in 2020 like it was in 1990, but more that it's been a victim of convenience in fiscal crises. CA has had a few state budget crunches over the past 30 years, and the annual UC budget is "discretionary spending" and not locked in, so is procedurally easy to cut. It was slashed significantly during both the dot-com crash and the 2008-2012 budget crisis, leaving us with today's lower level of support.

Re: Why has college gotten so expensive in the last 30 years? A blank check in 1993

#183

Post by geoelectric » Tue, Sep 01, 2020, 9:41 PM UTC

ummonk wrote: post #171

twic wrote: post #129

Earlier quoted context omitted.

Has the inflation-adjusted cash value of that support decreased, or the fraction of the costs it covers? "80%" and "20%" makes it sound like the latter. Because if it's the latter and not the former, the cause isn't declining support, it's increasing cost.

The latter. We've seen an increase in cost of education (as evidenced by private school tuitions, which have gone up and never had taxpayer support). In addition to this, student enrollment has increased, so per-student taxpayer funding has not kept pace even as taxpayer funding for public universities has gone up relative to the overall population.

Makes it a really specious argument in the previous context, then. The percentage goes down as the ratio of state-subsidized/private-subsidized becomes lower.

If the absolute number of state subsidization hasn't changed considerably--ignoring inflation--then the ratio changed because the private-subsidized number became higher.

If that outpaced inflation, then the real problem sounds a lot like people started throwing federal loan money at it so states didn't bother to increase their portion, so more federal loan money was needed, and repeat.

Maybe states haven't kept up with inflation so their contribution would technically be a decrease, but that's how numbers on paper work when they aren't updated due to lack of interest. The major ratio factor was all increases on the other side, some of which was buying power availability to the applicants--i.e. generally available private student loans rather than needs- or merit-based subsidy that has intrinsic boundaries.

Add in the whole "must go to a university or die poor" push of the anti-blue-collar 80s (not a thing previously) in the US that created a Cabbage Patch Kid rush for admissions slots and you're here. Significantly-increased buying power + spiking demand === runaway prices.

...or maybe not. But the percentage argument up at top of this comment thread doesn't prove that one way or the other without a lot more nuance.

Re: Why has college gotten so expensive in the last 30 years? A blank check in 1993

#184

Post by jpeloquin » Tue, Sep 01, 2020, 9:45 PM UTC

fastaguy88 wrote: post #91

It is difficult to overstate how mistaken this article is. College has mostly gotten more expensive because state support for public universities has dramatically decreased, from over 80% in the 1970's to less than 20% now. Since the taxpayer no longer pays for public higher education, the student does. The logic of this made some sense at the time; very high tuition subsidies were a gift to the upper middle and uppe…

To support and elaborate on the parent comment:

College tuition has increased faster than inflation, but this is not unique among service industries [1] [2]. The causes include [2]:

1. "Cost disease." Labor productivity has not increased in higher education, but has increased in industries that produce physical products, so costs have risen in general. Because educator productivity is flat, yet costs are increasing, the price of college increases faster than average.

2. Higher education needs highly educated workers. The wage gap between workers with and without a degree has grown over time [3], so the price of college grows faster than average. There may be a feedback loop here.

3. Technology adds cost to higher education because it has to be acquired, supported, and taught, without (yet) any commensurate increase in educator productivity. So the price rises.

Although tuition inevitably rises in /price/, it could still be /affordable/. It is less affordable now in the US than it used to be mainly because wages have not kept pace with GDP and, as the parent comment mentioned, state support for public colleges has decreased.

Note that [2] is a higher education industry publication, so it may have some bias. In particular its defense of the relative growth in college administrative staff compared to the growth of enrollment seems shaky. But the above points appear valid.

[1] https://www.aei.org/carpe-diem/chart-of-the-day-or-century/

[2] http://www.ntrp16.org/sites/default/files/Resources/ACE-%20T...

[3] https://www.bls.gov/charts/usual-weekly-earnings/usual-weekl...

Re: Why has college gotten so expensive in the last 30 years? A blank check in 1993

#185

Post by JamesBarney » Tue, Sep 01, 2020, 9:46 PM UTC

Hokusai wrote: post #111

ChuckNorris89 wrote: post #45

Earlier quoted context omitted.

>Universities in Europe are generally high quality and low cost. The cost is low for the student but it's pretty high for the taxpayers. Not US high but still, it's not free, there's lots of bloat in the system that thrives on volume of students not on quality so they try to push forward legislation and programs to increase the number of students, especially from abroad and build more faculties/universities with more…

> The cost is low for the student but it's pretty high for the taxpayers. That is a supposition that proves to be false. The same happens for health care. To have a centralized state sponsored education or health care system allows it to be more efficient that smaller for profit institutions that have incentives to increase cost to the students as their profit depends on that. Also, I would like to notice, that for E…

> Also, I would like to notice, that for European tax-payers it is an investment. That money spend in education brings back way more money that what the original cost was. So, to just talk about "cost" misses the point.

How do they know this is the case at the margin? The analyses I've seen of this is usually [benefits of education] = [# of college grads] * ([avg. college grad salary] -[avg highschool grad salary])

Which has two large fundamental issues. One that college grads are differently from highschool grads in ways besides education, and probably the people most likely to go to college are the ones that would benefit from it the most.

Not to mention several posts have talked about how much better educated Europeans are despite the U.S. spending significantly more money on education than any large European country.

Re: Why has college gotten so expensive in the last 30 years? A blank check in 1993

#186

Post by joe_the_user » Tue, Sep 01, 2020, 9:46 PM UTC

noetic_techy wrote: post #34

"The question then becomes a matter of how we fix this without diminishing access to a college education." This is the crux of it that everyone needs to get over. Universality, High Quality, Low Cost. Pick two. By letting the government meddle you have guaranteed no one can afford college and will be long in debt to a loan they cannot discharge in bankruptcy. I'd rather have cheap college then universal access for ev…

It's impressive to see this simplistic "you get what you pay for, damn it" sort of argument appearing in a situation where clearly students don't get what they pay for at all.

It's easy to find example in the US past and in other countries where high general and specialized quality education is provided in a fairly low-cost fashion.

Re: Why has college gotten so expensive in the last 30 years? A blank check in 1993

#187

Post by Ericson2314 » Tue, Sep 01, 2020, 9:47 PM UTC

Spooky23 wrote: post #147

fastaguy88 wrote: post #91

It is difficult to overstate how mistaken this article is. College has mostly gotten more expensive because state support for public universities has dramatically decreased, from over 80% in the 1970's to less than 20% now. Since the taxpayer no longer pays for public higher education, the student does. The logic of this made some sense at the time; very high tuition subsidies were a gift to the upper middle and uppe…

College became a political whipping boy in the 80s when the student loan rules changed. My dad went to City College in NYC in the late 60s/early 70s for $0. Like most of his fellow students, he was a 1st generation child of immigrants, and that enabled him to pursue a world unknown to the family. His dad was a proprietor of a bar; his uncle an able seaman on a tugboat, and other uncles NYC Firemen and Sanitation work…

> City College in NYC in the late 60s/early 70s for $0

Ah, the peak of an era.

Check out "Fear City: New York's Fiscal Crisis and the Rise of Austerity Politics" if you haven't, and cry some.

Re: Why has college gotten so expensive in the last 30 years? A blank check in 1993

#188

Post by stakkur » Tue, Sep 01, 2020, 9:47 PM UTC

It's a factor, but I disagree that it's the root cause. That distinction goes to the quiet destruction of aid by Ronald Reagan. The rapid shift towards loan-based support is directly linked to Reagan's targeted policies--and that shift led to a well-documented explosion in tuition costs.

And Reagan's legacy didn't just affect higher ed--it put public K-12 on the path to the financial and 'common core' shitshow that it is today.

Re: Why has college gotten so expensive in the last 30 years? A blank check in 1993

#189

Post by giantrobot » Tue, Sep 01, 2020, 9:48 PM UTC

kube-system wrote: post #73

jefftk wrote: post #10

> the feds should handle student loans the same way they handle medicaid/medicare reimbursement. I'm not sure how anyone looks at our health care reimbursement system and the decides that's the approach to apply to fix anything else? Personally, I'd like to see: * Employers are allowed to test students to see what they can do, but not evaluate them based on whether they went to school or where. * Make student loan de…

Making it riskier to lend to students again is a pretty regressive policy. It will definitely decrease the average student debt burden, but only because you'll be denying people the opportunity to incur the debt (and go to college) to begin with.

You're ignoring the feedback loop here. Supposedly wider availability of loans didn't increase enrollment, just tuitions. Before 1993 student loans weren't riskier for the lender. The government was on the hook for the loan if the student defaulted. The lender was never in danger of not getting their money.

Re: Why has college gotten so expensive in the last 30 years? A blank check in 1993

#190

Post by [deleted] » Tue, Sep 01, 2020, 9:48 PM UTC

Spooky23 wrote: post #147

fastaguy88 wrote: post #91

It is difficult to overstate how mistaken this article is. College has mostly gotten more expensive because state support for public universities has dramatically decreased, from over 80% in the 1970's to less than 20% now. Since the taxpayer no longer pays for public higher education, the student does. The logic of this made some sense at the time; very high tuition subsidies were a gift to the upper middle and uppe…

College became a political whipping boy in the 80s when the student loan rules changed. My dad went to City College in NYC in the late 60s/early 70s for $0. Like most of his fellow students, he was a 1st generation child of immigrants, and that enabled him to pursue a world unknown to the family. His dad was a proprietor of a bar; his uncle an able seaman on a tugboat, and other uncles NYC Firemen and Sanitation work…

[deleted]