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The Dangerous Delusion of Free Tuition, Part 2

The New York Analysis of Policy and Government concludes its study of the free tuition concept with a review of why tuition is so expensive, 

Largely ignored is the question of why college tuition has become so unaffordable.

In a CNN study, Julia Freeland Fisher “Rather than ratcheting up aid to meet ever-increasing price tags, we must get at the root of the affordability crisis by addressing the most fundamental component of any organization: the business model. … a closer look at the traditional business model of higher education reveals a stockpile of embedded inefficiencies and warped incentives… Troubling inefficiencies have also arisen out of a subset of colleges’ attempts to compete on the basis of infamously indulgent non-academic offerings — rock climbing walls, lazy rivers and extravagant student housing facilities, to name a few — intended to lure students, …In 2012, there were at least 157 recreational projects in progress at 92 U.S. colleges, representing more than $1.7 billion in new construction and renovation. These costs are inevitably passed along to students…”

A Business Insider report found that the average annual increase in college tuition from 1980-2014 grew by nearly 260% compared to the nearly 120% increase in all consumer items.  A Brookings study revealed that: “Education costs have soared…College tuition, net of subsidies, is 11.1 times higher in 2015 than in 1980, dramatically higher than the 2.5 increase in overall personal consumption over the period.

The Brookings analysis also revealed one key reason why those costs have gone up: the extraordinary growth in the number of high-paid, non-teaching positions within universities. Brookings found that “In 1988, for every 100 full-time equivalent students, there were on average 23 college employees. By 2012, that number had increased to 31 employees, with a shift toward the highest paying non-teaching occupations. Managers and professionals now outnumber faculty, who comprise just a third of the higher education workforce.”

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“In 2011, the last year for which figures are available, 42 private college and university presidents received more than a million dollars each for their work.  Robert Zimmer (University of Chicago) was the best-paid, at $3,358,723.  At public colleges and universities, nine top administrators garnered more than $1 million each in 2012-2013, with the best-paid, E. Gordon Gee (Ohio State University), receiving $6,057,615…In addition to their formal compensation, college and university presidents receive some very lavish perks.  These include not only free luxury cars and country club memberships, but free university housing.

“The soaring incomes of campus administrators are paralleled by their soaring numbers.  Between 1993 and 2009, their numbers reportedly increased by 60 percent, to 230,000―ten times the rate of growth of the faculty.   According to a February 2014 report by the American Institutes for Research, between 1987 and 2012 the number of administrators at private universities doubled, while their numbers in central university system offices rose by a factor of 34.

While those nonteaching positions are a burden on tuition payers, they are good for the same politicians who push for more people to go to college. Sara Swann, writing for Open Secrets  reports “For the 2016 election cycle, the education industry had a record-high contribution total of almost $81 million. Nearly all of this money is donated by school employees… Democrats received 86 percent … Since 1990, the education industry has never given less than 58 percent of its contributions to Democrats, with an overall average of 77 percent going to the left.” The two most prominent presidential candidates advocating for college for all received extensive support from the education industry.  Published sources reveal that Hillary Clinton took in about $23.7 million, while Bernie Sanders  Her primary challenger pulled in $5.5 million. By contrast,  Donald Trump only received $778,000.

Photo: State University of New York at Albany (NY Analysis photo)

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The Dangerous Delusion of Free Tuition

The promise of free tuition has become a favorite campaign theme of many politicians.  New York’s governor Andrew Cuomo, facing a primary battle from a celebrity opponent to his left, is providing a version of that in his state.   The odds are it will cause more harm than good. The free tuition idea follows another political error, that of the federal government subsidizing student loans. That resulted in universities charging higher rates.

The appeal, not only to potential university students, but to young adults burdened with debts from unjustifiably high tuition for an education that failed to get them a well-paying job is obvious.  The politics, not just for Cuomo, but for presidential contenders such as Bernie Sanders who have made this type of program the centerpiece of their platform, are appealing, but the results for students and their cash-strapped families, far less so.

There has been little discussion about how a state that continues to produce underperforming students at the grammar and high school levels and that imposes a tax burden that is chasing residents to other jurisdictions will afford the idea. There has been inadequate acknowledgement that the push, over the past few decades, for every student to attend college has simply resulted in the replacement of the requirement of a high school degree with that of a college degree, without any commensurate increase in either the pay or prestige of those positions.

Making college free for all will certainly increase enrollment, which has already expanded significantly.   The National Center for Education Statistics reports that about 20 million people attended college in 2017, and that figure is expected to grow regardless of public financing schemes. Governing magazine  noted that former President Obama’s College Education for all Goal would have resulted in a stunning doubling of current enrollments. That would have required more personnel and more facilities, driving up costs even further.

The broadening of college participation brings only the illusion of greater learning.  As enrollment has increased, the quality of higher education has decreased. Marc Tucker, writing for Education Week,  noted: “…many community college teachers do not assign much writing at all to their first-year students because they cannot write…for close to 40 percent of our college students, the first two years of college add virtually no value at all, and ‘not much’ value for the rest…colleges are typically teaching most students what we used to teach in the high school college-bound track and are not doing it very well…What I have just described amounts to an across-the-board collapse of standards in American education over the last 40 to 45 years…”

A Burning Glass report found that occupations historically dominated by workers without a college degree now require one.  Employers now require bachelor’s degrees for a wide range of jobs, but the shift has been dramatic for some of the occupations historically dominated by workers without a college degree. The credential gap can amount to 25 percentage points or more for middle skill jobs in some occupational families, like Office and Administrative and Business and Financial Operations. For example, 65% of postings for Executive Secretaries and Executive Assistants now call for a bachelor’s degree. Only 19% of those currently employed in these roles have a B.A.

  • In some roles, employers prefer bachelor’s credentials even when that makes the position harder to fill. For example, Construction Supervisor positions that require a B.A. take 61 days to fill on average, compared to 28 days for postings that don’t require a bachelor’s degree.
  • In other occupations, such as entry level IT help desk positions, the skill sets indicated in job postings don’t include skills typically taught at the bachelor’s level, and there is little difference in skill requirements for jobs requiring a college degree from those that do not. Yet the preference for a bachelor’s degree has increased. This suggests that employers may be relying on a B.A. as a broad recruitment filter that may or may not correspond to specific capabilities needed to do the job.
  • Jobs resist credential inflation when there are good alternatives for identifying skill proficiency. Many health care and engineering technician jobs, such as Respiratory Therapists6 , show little sign of upcredentialing. That is likely because those positions are governed by strict licensing or certification standards, well-developed training programs, or by measurable skill standards such that employers do not need to look at a college degree as a proxy for capability.

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The Report Concludes Monday.

Illustration: Harvard’s Widener Library (NY Analysis Photo)

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HARRY POTTER POLITICS

The worrisome disconnect between Americans of differing views is far more than just a battle of ideologies. Increasingly, the issue is not merely Democrat against Republican, or liberal against conservative. The divide now appears to be reality versus magical thinking.

America endures a $21 trillion national debt and adds to it with substantial annual deficits each year. Key existing social programs such as Social Security and Medicare are heading towards bankruptcy. The American Society of Civil Engineers rates the national infrastructure as only D+. Growing threats from abroad require significant increases in defense spending.

Despite that, a bevy of astronomically expensive programs are being seriously proposed, unhinged from all fiscal practicality. Politicians, of course, have always been free with absurd promises that they know can’t be kept, but the current crop of unaffordable ideas is gaining serious traction. The 2010 passage of Obamacare leads many to believe that further massive social programs can be enacted, if there are sufficient votes in Congress.   Financial responsibility is considered almost inappropriate to mention.

Questions about affordability are responded to with a simplistic call to raise taxes. But there is no effective way to pay for these things by increasing taxes. There is not enough income to be taxed at levels which would not destroy the economy. An attempt to do so would chase businesses and jobs out of the country, ultimately producing less, not more, Treasury collections.

In essence, tax increases are like Harry Potter’s magic wand.  Don’t try to find the logic in it, just accept the magic.

Consider some of the more salient unaffordable ideas currently in vogue.

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Free college tuition is an idea passionately advocated by many, especially young adults burdened with debts from unjustifiably high tuition for an education that failed to secure them a well-paying job. New York’s governor Andrew Cuomo has announced a plan to provide free college tuition.  Residents of his state are already taxed at a rate that chases people and businesses out. Where will the funds come from?

Extending free medical care and free tuition to U.S. citizens would be fiscally impossible, so why not provide those goodies to illegal immigrants as well? Examining the impact of California’s inclusion of illegals in the state’s generous benefits, the Federation for American Immigration Reform (FAIRUS)  reports: “The annual expenditure of state and local tax dollars on services for that population is $25.3 billion. That total amounts to a yearly burden of about $2,370 for a household headed by a U.S. citizen.”

One myth advocated by the free tuition, open borders, and Medicare for all crowd, often unstated in public but discussed with the like-minded, is that drastic cuts in defense spending would finance these concepts.  It’s time to do the math again.  Defense accounts for only about 14% of the total federal budget, and the world isn’t getting any safer.

But don’t worry. A wave of the magic wand of idealism will take care of all that.

Illustration: Pixabay

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American colleges: High Costs, Low Results Part 2

While University bureaucrats feast on taxpayer funds, they provide increasingly deficient education, in several key ways. The full-time college professor, with the time and facility to provide excellent quality for students, is increasingly being replaced by part-timers.

One example comes from Susan McNamara, writing in the Boston Globe  “Nearly 15,000 contingent and adjunct faculty teach in greater Boston. Many work at multiple schools, trying to make enough to support themselves and their families on low pay with no benefits. All have advanced degrees, and many live at or below the poverty level. We are now a majority of all college and university faculty, both regionally and nationally. Adjuncts are not temporary employees. Most of us do not work part-time hours. Yet, we are denied full-time pay and benefits, and have no job security. Many only survive by creating a heavy, piecemeal schedule across multiple schools. Adjuncts often have insufficient time to prepare to teach a course because they have little advance notice they are teaching at all. Without an office, we may have difficulty meeting with a student to discuss anything confidential, such as grades, or to provide additional instructional assistance.”

With dollars being diverted away from academic needs, the result is an educational experience that fails to produce graduates ready to take on the world.

Scott Jaschik, writing in Inside Higher Ed reports on a survey of employers performed by  The Association of American Colleges and Universities which found that “When it comes to the types of skills and knowledge that employers feel are most important to workplace success, large majorities of employers do NOT feel that recent college graduates are well prepared. This is particularly the case for applying knowledge and skills in real-world settings, critical thinking skills, and written and oral communication skills — areas in which fewer than three in 10 employers think that recent college graduates are well prepared. Yet even in the areas of ethical decision-making and working with others in teams, many employers do not give graduates high marks…”

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Fox News  has reported that “On an October evening in 2013, Hillary Clinton addressed a crowd of more than 6,000 at the University at Buffalo — a public college in upstate New York — speaking in a low-key, folksy manner about economic growth in the state’s second largest city. The 30-minute speech earned Clinton $275,000 — a hefty chunk of the $2 million in total she has received for delivering university speeches since leaving her post as secretary of state in February 2013. On Monday, Clinton, now the Democratic presidential frontrunner, unveiled a $350 billion bailout plan for college graduates faced with crushing student debt dubbed ‘the new college compact’ — a proposal her critics cast as blatantly hypocritical and disingenuous. The fee paid by the University at Buffalo could have covered a year of tuition for 42 students at the public institution — an irony her detractors, including rival GOP presidential candidates, were quick to point out.”

A Bloomberg  analysis determined that the annual cost to the taxpayers for the Clinton proposal could be as high as $520 billion over ten years.

The support comes not only from national figures such as Hillary Clinton, but from state politicians as well.  New York’s Governor Andrew Cuomo recently unveiled a proposal to provide free tuition to state schools for students whose parents earn less than $125,000.