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Tuition costs have risen 710% since 1983

statecraft.beehiiv.com

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Re: Tuition costs have risen 710% since 1983

#11

Post by ye-olde-sysrq »

toomuchtodo wrote: post #2

The only service category that has outpaced higher education is hospital services. https://www.aei.org/carpe-diem/chart-of-the-day-or-century/

How cheap TVs are is unreal. I was looking at the display TVs at Target and the largest one was only about a grand, maybe a touch less. Ridiculous how big of a panel, complete with "smart" OS and etc, you can get for (Mind you, I know "largest" doesn't mean most expensive usually - indeed the most expensive TV was "only" 65" but was still Capitalism has certainly worked really well for this one specific consumer good.

Re: Tuition costs have risen 710% since 1983

#12

Post by lotsofpulp »

drew-y wrote: post #6
londons_explore wrote: post #3

Main cause: Government-backed student loans. While it is technically the student paying, in reality the money is going (indirectly) from the federal reserve to the universities. Everyone loves free government money... The fact the student may never pay off those loans (and hence the government foots the bill) is the cherry on top.

Got a source for that claim?

Common sense?

Government (taxpayers) underwrite unlimited amounts to uninformed buyers paying informed sellers.

I am a seller (college boss), and I can boost my own income, and I know I have no competitive pressure to keep prices down, so why not increase the college budget and spending, hence justifying tuition increases.

Re: Tuition costs have risen 710% since 1983

#13

Post by toomuchtodo »

bmau5 wrote: post #4
toomuchtodo wrote: post #2

The only service category that has outpaced higher education is hospital services. https://www.aei.org/carpe-diem/chart-of-the-day-or-century/

And interestingly both have predominantly grown in "administrative" costs

Who knew providers would raise prices with wild abandon when demand is firmly inelastic and debt without default risk is liberally provided? /s

Hopefully states experimenting with universal higher education legislation makes some improvement possible: https://apnews.com/article/minnesota-legislature-college-tui... ("Minnesota lawmakers reach deal for free college tuition")

Note for this article that private colleges have the highest drop out rate, and Minnesota's plan excludes such institutions:

> Qualifying students would have to attend a two- or four-year school in either the University of Minnesota or Minnesota State systems, or a tribal college. Private college tuition would not be covered.

> From 2008 through 2009, enrollment in private for-profit colleges rose disproportionately compared to private non-profit and public colleges. Private for-profit colleges have extraordinarily high rates of default, near 16% of borrowers default within 3 years.

https://educationdata.org/student-loan-default-rate

Re: Tuition costs have risen 710% since 1983

#14

Post by londons_explore »

londons_explore wrote: post #3

Main cause: Government-backed student loans. While it is technically the student paying, in reality the money is going (indirectly) from the federal reserve to the universities. Everyone loves free government money... The fact the student may never pay off those loans (and hence the government foots the bill) is the cherry on top.

I believe this is no accident. The government wants a world class education system and leading research.

They could just give money direct to universities - but then it's hard to ensure they're getting good value for money.

But by giving it to students to in turn give to universities they get better value for money.

One day someone has to pay for that - and the students paying it back via loan repayments isn't awfully different to citizens paying it back via taxes. But with the student route everyone is more invested in getting good value for money. And non-university users (who tend to be the poorest) don't end up paying. Win win.

Re: Tuition costs have risen 710% since 1983

#15

Post by spondylosaurus »

ye-olde-sysrq wrote: post #11
toomuchtodo wrote: post #2

The only service category that has outpaced higher education is hospital services. https://www.aei.org/carpe-diem/chart-of-the-day-or-century/

How cheap TVs are is unreal. I was looking at the display TVs at Target and the largest one was only about a grand, maybe a touch less. Ridiculous how big of a panel, complete with "smart" OS and etc, you can get for (Mind you, I know "largest" doesn't mean most expensive usually - indeed the most expensive TV was "only" 65" but was still Capitalism has certainly worked really well for this one specific consumer good…

It probably helps that smart TVs provide one of the most lucrative environments for selling ads... although tbh I don't know if the hardware manufacturers get any kickback on that, but the people who develop the software where ads are shown almost certainly do.

Re: Tuition costs have risen 710% since 1983

#16

Post by FrustratedMonky »

londons_explore wrote: post #3

Main cause: Government-backed student loans. While it is technically the student paying, in reality the money is going (indirectly) from the federal reserve to the universities. Everyone loves free government money... The fact the student may never pay off those loans (and hence the government foots the bill) is the cherry on top.

If it is 'free', then why are students in debt and liable for it?

(and don't confuse the issue with current debt relief bill. The current bill has not been in effect since 1983, it is trying to give relief for this situation, not causing it).

Re: Tuition costs have risen 710% since 1983

#18

Post by skyyler »

ye-olde-sysrq wrote: post #11
toomuchtodo wrote: post #2

The only service category that has outpaced higher education is hospital services. https://www.aei.org/carpe-diem/chart-of-the-day-or-century/

How cheap TVs are is unreal. I was looking at the display TVs at Target and the largest one was only about a grand, maybe a touch less. Ridiculous how big of a panel, complete with "smart" OS and etc, you can get for (Mind you, I know "largest" doesn't mean most expensive usually - indeed the most expensive TV was "only" 65" but was still Capitalism has certainly worked really well for this one specific consumer good…

With TVs specifically, aren't their costs subsidized by the SmartOS features?

Re: Tuition costs have risen 710% since 1983

#19

Post by koube »

toomuchtodo wrote: post #2

The only service category that has outpaced higher education is hospital services. https://www.aei.org/carpe-diem/chart-of-the-day-or-century/

I generally see charts like this in relation to Baumol's cost disease, I'm surprised the linked article never mentions Baumol, but goes on to talk about government regulation and foreign competition.

https://en.wikipedia.org/wiki/Baumol_effect (See also section on education https://en.wikipedia.org/wiki/Baumol_effect#Education)

Basically as scalable goods and services get cheaper, non-scalable goods and services become relatively more expensive. In terms of hospital services and college tuition, this is a much more intuitive explanation than government regulation, although I'm open to more informed opinions.

Re: Tuition costs have risen 710% since 1983

#20

Post by vkou »

NoMoreNicksLeft wrote: post #9
bmau5 wrote: post #4

Earlier quoted context omitted.

And interestingly both have predominantly grown in "administrative" costs

If we get the government more involved in funding these things directly, it can only improve the outcome.

Funding directly by issuing a blank check to the vendors? No, it won't.

Funding directly by setting a price cap, and paying vendors that amount for services rendered? Seems to work for almost every other developed country in the world.

With the monetary savings of #2, it could even give every medical student a fully free ride.

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