Long ago, while in high school, I thought I might want to go to medical school and, growing up in New Haven, even entertained thoughts of attending Yale. But that was back in the 1940s and the cost to attend Yale or any other of the Ivy League schools was out of reach for a working-class family with five kids. There were no government loans and scholarships were few and meager. So, it was off to work at 16 and enrollment in a state commuter college, paying my own way.
I was fortunate, though. The school was New Haven State Teachers College, sitting on a tiny, two-building campus in the shadows of Yale’s ivy-covered towers. Many of our professors also taught at Yale and our college president was also Dean of Education at Yale. And our classes were taught by professors, not graduate students. Today the school is known as Southern Connecticut State University with a suburban campus of 171 acres and an enrollment of about 8000, offering advanced degrees in a number of disciplines.
I’m grateful for the affordable but excellent education I received that enabled me to go on to earn master’s and doctoral degrees in management and education which actually served me well throughout three successive careers over a nearly seventy-year period. And I don’t really resent the good fortune of those debt-encumbered students who may have some or all of their remaining debt forgiven under President Joe Biden’s debt cancellation plan. I just happen to think it’s bad policy, sets a bad example, and is unfair to those who repaid their debt or forwent college altogether rather than borrow heavily to finance it. It is also the proper role of Congress to forgive federal obligations, not the executive branch’s which could be tempted to forgive federal obligations in order to encourage political support at election time. It also will do nothing to reduce the inflated sticker price of a college education.
The so-called sticker price is the full rate of tuition and fees before scholarships and other forms of aid are deducted. The remainder is the net price. Average sticker price has been increasing much faster than inflation and guess why? Partly because of the easy availability of government loans and the widespread prevalence of the notion that to be successful one must go to college and therefore, everyone deserves a college education. The availability of government loans takes the pressure off colleges to do more to reduce the cost of higher education and encourages them rather to spend it on building programs, campus enhancement, salaries, faculty and above all, administrative staff. There is now a dean and/or associate dean, and/or assistant dean for just about every topic you can think of.
Sticker prices have increased about 73% faster on average at private colleges than at state schools. Then there is the cost of housing, food, books, entertainment, beer—er, other essential needs. According to a Fidelity survey, 40% of high school students still rate cost as the most important factor in choosing a college. But students and their families have been convinced by the media and the education industry that college graduates earn much more than non-college graduates and the more degrees, the higher the earnings. That’s true in the aggregate but much depends, of course, on the field of study and the demand for those skills. And in some professions, such as law, the particular university attended matters greatly. A college degree alone does not, by any means, assure the graduate of higher income or even any income. It’s all about demand. There isn’t a lot of demand for majors in gender studies, what jobs there are in the field do not pay well and are often short-lived. About 16% of those with only a high school education earn more that college graduates and many of the world’s most successful and richest entrepreneurs are college drop-outs.
The major matters. A biochemistry major for example, may reasonably expect to earn at least $94,000 after graduation. A visual and performing arts or film major, on the other hand, can probably expect less than $50,000 to start. Many colleges took advantage of the increased enrollment that came from the easy availability of government loans to expand the number of courses and majors offered to include fields that are popular but which offer few good-paying jobs.
President Biden’s debt forgiveness will not make the debt disappear. Rather it shifts the burden of who will pay. It will not decrease the high sticker price of a college education but instead will probably exert upward pressure on the price by encouraging more borrowing. It was easy government lending which caused the problem in the first place by encouraging some to make bad decisions about borrowing more than they could afford. It goes without saying, that it is grossly unfair to those who paid their obligation or decided not to go to college because of the cost.
Vol. 38, No. 36 - Thursday, Sept. 8, 2022
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