Sunday, October 19, 2008

Shame on U

From The Associated Press yesterday:

Associated Press
DULUTH -- The University of Minnesota Board of Regents has unanimously approved a proposal to increase tuition 9 percent for most students by 2011.
It would also increase faculty and staff pay 6 percent over the same period.
But the Legislature still has to approve it and System President Robert Bruininks acknowledged the request may be a tough sell. That's due to the troubled economy and a state budget deficit projected to be at least $2 billion.
But he says the 2010-2011 budget request is necessary to keep the university attracting top-notch faculty and research grants critical to the state's economy.
The budget request asks the Legislature to add $141 million to the nearly $1.5 billion it currently gives to the university for two years.

Current Tuition for the U is $10,806 for MN Residents- Room and Board is $7,280- With a 9% increase- you're at almost $12,000 a year in tuition only-- $20,000 to go to the U for one year- $80,000 for a 4-year undergraduate degree. And the University calls this a great value?? I would have never been able to afford the U with these outrageous prices.

These numbers don't add up with inflation at all! Back when I was in school-1991-1995, I paid approximately $1,000 per quarter for tuition- $3,000 a year...I paid roughly the same for Room and Board- living in a Sorority. I paid for half of my education with student loans and worked for the rest.

When I use a couple different online inflation calculators- I come up with $4,800 a year for what 2008 tuition should be if it were rising at the rate of inflation since 1991.

Of course- now they're offering "Free Tuition" for select MN residents through their Founders Free Tuition Program. (A package of government paid grants). And they also have a $150 Million President's Scholarship Fund. Hey guys- you wouldn't need to offer grants and scholarships if the college were reasonably affordable.

So what's going on?

There's been a push at the U under President Bob Bruinink's leadership for the U to "rank among the top three public research universities in the world". That's wonderful.

But with this qwest for greatness, they're short-changing Minnesota taxpayers. I've heard several antecdotes that A students from Eden Prairie High School aren't able to get into the U and that's wrong...completely wrong. It's a public institution and A and B student residents should have no problem getting in.

In a MN Daily article from last week- Bruininks said "The highest priority in this budget is to protect the jobs of the talented faculty and staff who work at the University, because without them the University can’t be an outstanding contributor to Minnesota’s economy and quality of life. So the highest priority is to retain the jobs of people who work here and also to compensate the people at some, at a fair level for the high quality of their work, so that the biggest part of this budget request, roughly 70 to 75 percent is to compensate faculty and staff."

Students have ALWAYS been secondary at the University and Bruininks- a 30 year staff member- is not the leader to change this.

But it's not just the U who's boasting outrageous tuition these days- good private schools cost $30,000+ a year in tuition. I have a theory that with the easy availability of credit- that the schools are just counting on students to pay the bills with financial aid and they must be doing just that for the schools to demand and get what they're asking for.

My parents made $18,000 a year when I applied the University- as I recall, I qualified for about $3,000 in Stafford Loans (max). I took out that amount and had $12,000 debt when I graduated. Now students are probably sitting $40,000+ in debt just for a public-school degree.

I also think the Unions still rule the roost at many Universities and the salary and benefit spending is out of control. And then there's the simple fact that education spending is always the "sacred cow" that no legislator wants to touch. The U of M's biennial budget has gone from roughly $900 million in 1995 to $1.5 Billion today-- again completely out of line with inflation.

So- when everyone is screaming about what a tragedy it would be for credit to dry up in this country- I'm thinking it doesn't sound like such a bad thing after all if it means driving down unaffordable tuition. Of course, the bailout ship has already sailed and rather than force administrations to answer the tough questions about tuition pricing- a liberal majority will simply "solve the problem" by putting more money into the financial aid program budgets. Young Americans will go so far into debt to attain a degree- it will take them decades to pay off their loans and government spending will continue to go through the roof.

Notice: When liberals talk about help with college tuition- they're not talking about addressing the rising costs and instituting cost containment measures (like they talk about with health care)- they are simply talking about dumping more tax money into the system...period.

1 comment:

Jim said...

It is discouraging when they raise tuition and then say something like, "to offset the costs, we're also increasing funding for scholarships" or something. How about not increasing the tuition as much, you nubs? Of course, they want to do their social engineering and wealth redistribution, so they use scholarships for their various agendas. They're always pushing "diversity" even when that might go against their goal of being a top university. If you're ignoring merit and filling quotas... oops, can't say that word... umm... providing equal opportunity grants based on race, you're not allowing as many fully-qualified (and paying) students with a history of good grades, etc., into your classes. That increases your costs and lowers your chances of being a "top" anything.

If you look at some of the majors available, you'll wonder how any of those people find jobs. I suppose it proves you can sit and do busy-work for four years, but some of the degrees are pretty worthless. Just like the federal government, entire departments could be eliminated and the rest of us would be better off. But no, just raise tuition and keep the fluff.

You're right. Tuition is increasing far faster than inflation. Of course, the official inflation number provided by the government is a hoax based on goofy hedonic pricing models and other statistical fantasy which always makes it appear lower than it is. They changed the way inflation was calculated in the 80's, and again in the 90's. If you calculated inflation the way they did before the 90's change, it would be over 8%, and if you calculated the way it was done in 1980, you'd have over 12% inflation. That's closer to what you see in recent food cost increases, healthcare costs, energy (until very recently), and tuition. This dude has more info: (click on "alternate data"). These tweaks are not a secret "conspiracy." It's all documented, it's just confusing and not well advertised. As soon as you start talking about the distortions of geometric weighting, you've lost most people. Beyond making the GDP look better and keeping the average Joe from realizing exactly how much purchasing power is being stolen from his savings, the advantage of lying about the true inflation number is that you don't have to give the oldies as much money when you do the social security cost of living adjustments.

Anyway, even by the more realistic (less manipulated) inflation numbers, college tuition has increased faster than inflation. This is part of the credit bubble. Just like with housing (Fannie Mae), there's a government sponsored enterprise (GSE) that provides subsidized loans for college tuition (Sallie Mae). The government backing of these loans allows them to charge lower interest rates. These GSEs, as is common with a "good intentioned" government program, have the opposite effect of their goal. "Let's make education more affordable by making student loans easier to get." This increases demand and a lot of people who shouldn't be going to college go. This increased demand allows colleges to rapidly inflate the cost of tuition, which creates more demand for government subsidized loans, and the cycle of government dependency and out-of-control prices continues. This happened in housing, tuition, and medicine with medicare/caid. It will get worse in medicine once the "universal healthcare" boobies get their way.

The continual lowering of standards is another reason for the increased demand for higher education. A high school education used to mean something, but now a lot of people can graduate without knowing how to read. Of course, now that everyone and their brother can go to college and pick up some funky degree, you almost need a graduate degree to stand out. Of course, the longer the education system has you to mold your young mind, the better it is for the powers that be. More "lib ed" requirements for everyone, yay!