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Why Is College in America So Expensive?

theatlantic.com

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Re: Why Is College in America So Expensive?

#91

Post by frebord »

Domenic_S wrote: post #3

I didn't see this discussed in the article, but IMO the main driver is the availability of student loans. When the government guarantees loans, you can lend whatever you want! The price of a TRIPLE occupancy dorm + 7 day meal access is $14,813.29/YEAR at UC Davis. The "meals", if they haven't changed in the last decade, are Sodexo garbage. And don't forget a "year" doesn't count the summer, or winter break.

> Ultimately, college is expensive in the U.S. for the same reason MRIs are expensive: There is no central mechanism to control price increases. “Universities extract money from students because they can,” says Schleicher at the OECD. “It’s the inevitable outcome of an unregulated fee structure.”

Why do people always reach for central control, when we have the ultimate mechanism of price control as a core part of our society (competition).

What happens when the government tries to provide for us: they gaurantee home loans: Financial crisis, they gaurantee drug costs: Skyrocketing drug costs, they gaurantee your student loan: Skyrocketing cost of school

By it's nature, anything the government subsidizes is going to be taken advantage of. You either have to take full central control (lets not go there) or let the free market actually work. You can't layer the two.

Re: Why Is College in America So Expensive?

#92

Post by mbostleman »

kfoley wrote: post #79
armenarmen wrote: post #55

Earlier quoted context omitted.

Exactly. Access to cheap debt will always drive up prices. Lower the interest rates for anything (houses pre recession) and prices skyrocket.

It's not even necessarily cheap debt. A lot of my undergraduate loans were at rates of 6.8% which I consider somewhat high. The problem is it's easily accessible debt to people who have no concept of what tens of thousands of dollars is really worth. You see the amount you're borrowing on the form and it's really nothing more than a number.

Exactly. Ask high school graduates and the vast majority of their parents to explain the cost of capital and show the projected return on the college tuition (as well as the 4 years of lost opportunity not participating in the market) and you just get blank stares. They're way too focused on the social rituals of move in day and fraternity/sorority rush.

Re: Why Is College in America So Expensive?

#93

Post by LeftTurnSignal »

amreact wrote: post #61
Alupis wrote: post #27

Earlier quoted context omitted.

I certainly don't dispute that - it's borderline criminal what the University-sanctioned housing charges - particularly when they stack up to 5 people in a single unit! However, in my experience, most students live off-campus these days. There's just not enough student housing, and it's a terrible deal anyhow.

At UAH (University of Alabama in Huntsville) they have started requiring first-year students to live in the dorms. Not sure if they require second-year students to.

They require that here too. If you live in town or within a certain area you can get exempt from it if you're parents sign some papers.

Re: Why Is College in America So Expensive?

#94

Post by danaris »

ergothus wrote: post #17
Domenic_S wrote: post #3

I didn't see this discussed in the article, but IMO the main driver is the availability of student loans. When the government guarantees loans, you can lend whatever you want! The price of a TRIPLE occupancy dorm + 7 day meal access is $14,813.29/YEAR at UC Davis. The "meals", if they haven't changed in the last decade, are Sodexo garbage. And don't forget a "year" doesn't count the summer, or winter break.

Id' be careful in assuming meals haven't changed in the last decade. Mass-food options aren't great, but on other campuses I've visited I've been jealous enough to wish I was eating there semi-regularly.

We had Sodexo at the small college I work at until a couple of years ago.

They're not good.

Re: Why Is College in America So Expensive?

#95

Post by prostoalex »

squozzer wrote: post #80
Domenic_S wrote: post #3

I didn't see this discussed in the article, but IMO the main driver is the availability of student loans. When the government guarantees loans, you can lend whatever you want! The price of a TRIPLE occupancy dorm + 7 day meal access is $14,813.29/YEAR at UC Davis. The "meals", if they haven't changed in the last decade, are Sodexo garbage. And don't forget a "year" doesn't count the summer, or winter break.

Essentially, the loans act as subsidies for colleges. For the student, it's a different story. And as with medical care, the response to price increases has been to shovel more money. >Ultimately, college is expensive in the U.S. for the same reason MRIs are expensive: There is no central mechanism to control price increases. “Universities extract money from students because they can,” Let me rephrase - There is no m…

Not that it’s that prevalent but lack of demand serves as a kind of price constraint https://www.insidehighered.com/news/2017/11/13/spate-recent-...

Re: Why Is College in America So Expensive?

#96

Post by froindt »

xienze wrote: post #37
ergothus wrote: post #21

Most of the other points in comments here are valid (or potentially so), but one thing I've not seen mentioned is the decrease in govt funding of public colleges and university. When I attended college 20 years ago (Penn State)I remember seeing graphs showing how decreased state funding matched tuition hikes pretty well. A quick google search turned up https://budgetandpolicy.org/schmudget/cuts-to-higher-educati... w…

I think a lot of university staff cry wolf over funding and always have, even in the good times. Yeah, they're really feeling the effects of it, what with admin staff sizes increasingly exponentially, constantly building new buildings and renovating existing ones, etc. My humble state school is like a luxury resort these days. There's puh-lenty of fat for colleges to trim if they're really feeling the pinch, but they…

I agree with the luxury portion. My university hasn't added a "cheap" dorm in decades. Now they're all suites, where 2 or 4 people share a bathroom, and are much more expensive.

I think a big part is students growing up in a middle class lifestyle and wanting to change as little as possible. I lived in the cheapest dorm available (no AC in the heat and humidity of Iowa). At current rates, 4694/year versus 6415 in the super nice ones, all before the meal plan.

So we have tons of people with low earning potential trying to maintain the lifestyle their parents have provided for them despite the fact that maintaining that lifestyle after college will mean they're saving little to nothing, and that their student loans will live on for many years.

People waking up to the harsh reality of what starting wages will get them, how long student loans would take to pay back, etc. would go a long way toward cutting the fluff costs associated with college.

Re: Why Is College in America So Expensive?

#97

Post by Alupis »

fzeroracer wrote: post #84
Alupis wrote: post #75

Earlier quoted context omitted.

Working professional doesn't necessarily mean bachelor-degree professionals. There are plenty of places that hire students full-time, for interships or full positions. Students can even get unskilled jobs - nothing wrong with that. Working at McDonald's, possibly working you way up to shift leader, team leader or manager is perfectly acceptable. Just so that you work full-time.

You're extremely out of touch with the modern day job market and issues students face. There's zero to very little career advancement while working minimum wage jobs. Minimum wage jobs won't even cover the cost of rent in most states, let alone the full cost of living and the cost of college. Saying that there are 'plenty of places' is also outright wrong considering the competition for minimum wage jobs is harsh; it…

You're talking to a student who's spent 15 years attending community college and then University while working several full-time jobs to get to where I am today.

Don't tell me I'm out of touch when I'm living exactly what I'm preaching. Don't tell me it's impossible when I'm doing exactly what I advocate for.

It's time to change the University system... and standing here and saying these things are too hard to fix is why it's so broken.

The solution isn't more tax-payer subsidies... it's fixing what we expect out of Universities, and what we expect out of students.

Re: Why Is College in America So Expensive?

#98

Post by uhtred »

justwalt wrote: post #82
uhtred wrote: post #70

Because the game is rigged. Citizens without debt are a danger to the established order. Why else are young people encouraged to get into tens/hundreds of thousands of dollars worth of debt, for a degree in something vague like "business", just to become recruitment consultants. After that they are encouraged to buy a big house (in other words take on a huge mortgage), and 3 cars. Debt keeps citizens chained down and…

In the case of housing, how is having a mortgage worse than renting? You could at least sell the house and have [some of] the money back.

Actually I take back the mortgage part. People these days are lucky if they can afford any kind of house, big or small, at least in or near big cities. Most people are probably just glad to own anything let alone a big house.

Re: Why Is College in America So Expensive?

#99

Post by mbrumlow »

squozzer wrote: post #80
Domenic_S wrote: post #3

I didn't see this discussed in the article, but IMO the main driver is the availability of student loans. When the government guarantees loans, you can lend whatever you want! The price of a TRIPLE occupancy dorm + 7 day meal access is $14,813.29/YEAR at UC Davis. The "meals", if they haven't changed in the last decade, are Sodexo garbage. And don't forget a "year" doesn't count the summer, or winter break.

Essentially, the loans act as subsidies for colleges. For the student, it's a different story. And as with medical care, the response to price increases has been to shovel more money. >Ultimately, college is expensive in the U.S. for the same reason MRIs are expensive: There is no central mechanism to control price increases. “Universities extract money from students because they can,” Let me rephrase - There is no m…

There was before the government got its hands in it.

Before guaranteed loans students had to be verified based off their merritt to get a loan. Lenders took a real risk and had incentives in the person being successful so they would have hopes of the loan being paid back. This was near perfect as schools could not not charge more than lenders would risk.

Thes solution in this case is to remove the government guarantee, and let the free market work.

Re: Why Is College in America So Expensive?

#100

Post by fzeroracer »

Alupis wrote: post #97
fzeroracer wrote: post #84

Earlier quoted context omitted.

You're extremely out of touch with the modern day job market and issues students face. There's zero to very little career advancement while working minimum wage jobs. Minimum wage jobs won't even cover the cost of rent in most states, let alone the full cost of living and the cost of college. Saying that there are 'plenty of places' is also outright wrong considering the competition for minimum wage jobs is harsh; it…

You're talking to a student who's spent 15 years attending community college and then University while working several full-time jobs to get to where I am today. Don't tell me I'm out of touch when I'm living exactly what I'm preaching. Don't tell me it's impossible when I'm doing exactly what I advocate for. It's time to change the University system... and standing here and saying these things are too hard to fix is…

And you're talking to someone that went through it all the same. Just because it's worked out for you doesn't make your experience the norm for all students. If you're expecting all students to spend 15+ years working just to get through their degree then I would argue that system is just as fucked up as the one we currently have.

The solution is to make college free for students and wipe away student loan debt. You're not going to fix the expectations, and even if you did that doesn't solve the mess we're in right now, does it?

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