Historically, public universities have been much more affordable in comparison to private universities and often have programs that rival those of the private universities in terms of national rankings. However, the Wall Street Journal published an article on December 14, 2012 that has challenged this notion with the tuition hikes at University of Colorado at Boulder.
Read More: Who Can Still Afford State U ?
"When Steve Joiner attended the University of Colorado in Boulder in the late 1980s, his parents—an Air Force mechanical supervisor and a teacher—paid his tab of about $4,000 a year, roughly $8,600 in today's dollars. He earned a master's degree and became a high-school math teacher."
"In August, Mr. Joiner's daughter Akaysha, the valedictorian of her high-school class, enrolled at CU, as the big campus here is known. But tuition, room, board and books for in-state students is now $23,000 a year—a sum Mr. Joiner and his wife, a social worker, weren't prepared for."
What could possibly be the cause of such a rise in tuition? Why has tuition at these public universities gone up so much during the past 40-50 years? In fact, tuition has been rising steadily faster than the rate of inflation. Wall Street Journal offers some self evident observations as to why this might be happening, but I have an essential piece of the puzzle that they sadly don't touch upon that much.
"A number of factors have helped to fuel the soaring cost of public colleges. Administrative costs have soared nationwide, and many administrators have secured big pay increases—including some at CU, in 2011. Teaching loads have declined for tenured faculty at many schools, adding to costs. Between 2001 and 2011, the Department of Education says, the number of managers at U.S. colleges and universities grew 50% faster than the number of instructors. What's more, schools have spent liberally on fancier dorms, dining halls and gyms to compete for students."
"For generations of Americans, public colleges and universities offered an affordable option for earning a college degree. Now, cash-strapped states across the country are cutting funding for colleges and directing scarce resources to primary and secondary schooling, Medicaid and prisons. That is shifting more of the cost of higher education to students and their families."
"Such changes are eroding the once-sharp distinctions between public and private institutions. Public universities "are creeping toward the private, nonprofit model, where everybody pays market rates rather than subsidized rates," notes Kevin Carey, director of the education-policy program at the New America Foundation, a think tank. The University of Virginia's graduate school of business, for example, now receives no state funding."
While I disagree with the idea that these public universities are "creeping towards" a model where the students pay so-called market rates, as these universities are already heavily subsidized by state and federal governments from what I can understand, these are certainly all factors in why tuition has gone up so dramatically. In fact, financial aid itself has been one of the key factors in why the prices of these public universities have gone up at such inflationary rates. Lyndon B. Johnson signed the Higher Education Act in 1965 which created many of the financial aid programs that are in existence today. Starting around 1975, college costs begin to rise faster the rate of inflation as you can see in this timeline of college tuition.
"Prior to the 1970s, college tuition rates only increased only about 2-3% a year, which was fairly on par with the rest of the economy. Since the mid-seventies, however, college prices have soared, going up 5-6% above inflation. In 2003, for example, average college costs went up a whopping 14% in just one year."
The Cato Institute also published a detailed policy analysis in 2005 on how financial aid programs have directly contributed to such high inflation in college tuition in general and offer free market Milton Friedman and Friedrich Hayek type of solutions to this problem, something that the Wall Street Journal failed to address in their piece. The answer to solving this problem is fairly self evident and a lot simpler than people realize.
Here is one final quote from the Wall Street Journal article, which also details the increasing efforts of these public universities to have a much more "diverse" admissions process for their classes.
"Adams State is located in a rural area that is heavily Hispanic, where household income is about two-thirds the state average of $57,685. More than 60% of Adams State students receive federal Pell grants for low-income students. After years of growing enrollment, the freshman class this year shrank by nearly 10%, to 525 students. "We think we've priced some students out of the market," says Adams State President David Svaldi."
It's quite a shame that a lot of politicians are literally economically ignorant when it comes to laissez-faire and free market economics and how the solution to this problem lies in such concepts and less government intervention in higher education. They are afraid to tell the public the truth on these matters fearing that they will lose votes in subsequent election cycles.