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| Stewart Cairns |
| Students in Albany protesting higher tuition. The proportion of a public college's budget supplied by the state has fallen sharply. |
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| Marty Katz for The New York Times |
| Representative Howard P. McKeon is fighting to curb tuition increases. His bill calls for withholding federal aid from offending colleges. |
Can anything besides an act of God stop the rise of college tuition?
For the last several months on Capitol Hill, the higher-education establishment has been on the defensive over the question -- and at times things have gotten very testy.
The occasion is the once-every-five-years review by Congress of its federal aid policies -- the grants and loans that ensure that rich children aren't the only ones who get to waltz across academia's green lawns and into the best jobs in the knowledge economy. Five years ago, during the last such review, Representative Howard P. McKeon, a California Republican, and some colleagues decided to confront head-on the trend that was making federal aid so expensive: the rising cost of college. The result, after months of hearings and tough talk? ''A nice book,'' Mr. McKeon says, smiling but distinctly unamused.
The 326-page ''Study of College Costs and Prices, 1988-89 to 1997-98'' is, indeed, a fine document, bristling with statistics and nuanced arguments. Tuition, of course, looked at it, laughed, and headed back up Mount Everest.
This time around, Mr. McKeon, a senior member of the House Committee on Education and the Workforce, ditched the scholarship. In September, the committee's Republican leaders released a blistering, emphatically unnuanced report recounting alarming tuition increases at public colleges in recent years -- over the last decade, after adjusting for inflation, up 48 percent in Michigan, 80 percent in Idaho, 52 percent in Maryland. The House members culled alarming quotes from students, drawn from news articles (a philosophy major at the University of Kansas: ''It's almost come to the point of starvation at times'') and lit into colleges for their lack of ''accountability.''
Mr. McKeon brought out the stick in October, introducing a bill that would punish universities that raise tuition too far too fast. Institutions that increase tuition more than twice the rate of inflation would be placed on a ''watch list'' and, in 2011, possibly lose federal money. (The cheapest 25 percent of colleges in each category -- two-year, public and private -- would be exempt.)
A large swath of academia has reacted to the legislation with indignation. The main objection is that the eye-popping percentage increases have mostly been caused by state legislatures gutting university financing. In Wisconsin, for example, the Legislature solved its budget woes largely on the back of the University of Wisconsin system, cutting $78 million, or 7.2 percent of its budget. The tuition increase of 15 percent, to $5,139, didn't come close to making up the difference. The state has announced that further deep cuts are to come.
From New York to California it's the same story. The proportion of public-college budgets supplied by the state has dropped precipitously. Someone has to pay for public colleges. Should state colleges take the heat when the legislatures purposely shift the burden from taxpayers onto students and their parents?
Stanley Fish, dean of the College of Liberal Arts and Sciences at the University of Illinois at Chicago, doesn't think so. In two op-ed articles criticizing the McKeon proposal, he seems to reflect the consensus among college officials: ''If the revenues sustaining your operation are sharply cut and you are prevented by law from raising prices, your only recourse is to offer an inferior product,'' he wrote. ''Those who say, as the state has said to the University of Illinois, 'We're taking $200 million from you but we expect you to do the job you were doing and do it even better,' are trafficking either in fantasy or hypocrisy. I vote for hypocrisy.''
At this point, the two sides -- the colleges and the Republican would-be cost containers -- are talking past one another. At a late-September hearing on the college cost crisis, Representative Phil Gingrey, a Georgia Republican, glared down over his glasses at several witnesses -- among them the president of Murray State University in Kentucky, a representative of state colleges and a Washington-based higher-education analyst -- and ridiculed their argument that the best way to soften the blow of tuition increases would be more money for poor students.
''My father used to say,'' Mr. Gingrey said, ''that when you ask a rich man how much money he needs to be happy, he'll say, 'Just a little more.''' Colleges, he said, would just use more money for the poor as an excuse to jack up tuition even higher. Congress had significantly increased Pell Grants for poor students in recent years. At what point, he asked, were colleges going to stop making excuses and start ''stepping up to the plate on the cost side of the equation''?
A week later, Republicans invited a new set of college leaders to a roundtable talk. As Mr. Gingrey again lectured the officials, William E. Kirwan, chancellor of the University of Maryland's 13 institutions, was having trouble maintaining his diplomatic smile. ''I think we need to communicate better with you,'' he said. ''I want to repeat: We had a $200 million hole in our budget. We covered $75 million of that with tuition. We ate $125 million. Our faculty and staff haven't had a raise in two and a half years.''
In his office between hearings, Mr. McKeon, a genial 65-year-old father of six, responded in a baffled tone: ''To me, it's like they've got their heads in the sand. Their view is, 'Things are fine, we know what we're doing, just send more money.''' Like the college officials, he, too, claims to be fighting for poor students. He likes to cite a finding of a recent federal report that 22 percent of low-income students are shut out of college by cost alone.
Indeed, if Congressional leaders seem to be skipping over the story at the state level, college officials have been hardly beyond criticism. When the Republicans want to demonstrate that colleges would keep raising tuition regardless of what state legislatures do, they don't have far to look for evidence: Tuition at private colleges rose 6 percent, to an average of $19,700 this year. It has increased at a rate greater than inflation basically for the last century. That can't possibly continue forever. Or can it?
Higher education is an astonishingly complicated, quasi-public, quasi-private industry, one that charges annual fees ranging from $2,000 to $40,000. It's difficult to generalize about it. Is college too expensive? For whom? Poor students? The middle class? How much is too much? On Capitol Hill and across the country, policy makers are grappling with the complexities -- as well as the myths and misunderstandings -- of the tuition crisis. As witnesses paraded before Mr. McKeon's committee, several key points emerged that help to frame the debate.
1. Tuition is cheaper than you think.
News articles about the Ivy League's $40,000 annual cost -- and reports of 10 and 15 percent increases at state colleges -- have had an effect. Call it panic. Seventy percent of Americans think college tuition is ''beyond the reach of the average family,'' the Republican report says. But do they know what they're talking about? In fact, Americans wildly misstate tuition levels. In 2001, according to a survey by the American Council on Education, the typical American thought in-state tuition at a public college was $11,600. (It was $3,750 that year.) Asked about the full cost, including room and board, they still guess double the actual costs.
And then, colleges are quick to add, you have to remember the role of financial aid. For example, at the University of Maryland -- one of the most expensive public colleges in the country, with an annual cost, including room and board, of $14,000 -- three-quarters of the students get financial aid: an average $7,000 each.
Once you factor in financial aid, the net cost of a four-year public-college degree rose only 7 percent from 1992 to 1999, according to Sandy Baum, an economics professor at Skidmore College. (Note, though, that that leaves out the last few years of erratic increases.) And many institutions still qualify as genuinely inexpensive: San Francisco State University: $2,480 for tuition and fees. The University of Florida: $2,780. The University of Illinois at Urbana-Champaign: $3,527. It is still expensive, of course, to forgo work to attend college, and federal grants aren't growing as fast as living expenses. At public colleges where tuition is creeping up to $6,000 and $7,000, debt levels are also inching dangerously close to private-college levels, proving a serious hurdle for low- and moderate-income families. But still, with aid, many more people can afford college than think they can.
2. There's no single ''cost crisis'': privates and publics are different worlds.
The complexity of financial aid aside, the size of tuition at private colleges -- and its rate of increase -- at least gives some sense of how well a college is controlling costs. That's not necessarily so at public colleges.
States set their tuition artificially low to keep the barriers to college as surmountable as possible. States have different policies about this. Those in the mid-Atlantic and Northeast set their tuitions somewhat higher than average, and then steer aid to poorer students. States in the South and West tend to keep tuition lower for everyone. (This has led to some incongruous moments: Florida student leaders were well represented in September on Capitol Hill protesting tuition increases. But Florida's tuition is less than half that of some states and would be considered a steal in many parts of the country.)
One catch is, the lower the tuition, the easier it is to have a high-percentage increase when the state's portion of the budget shrinks -- as the president of Murray State University, F. King Alexander, explained at a recent hearing. Murray State, which sits in the poor lakes region of Western Kentucky, suffered a 1.8 percent budget cut this year, which led to a tuition increase of 15.9 percent for this fall. (Murray State also closed its television station, cut or froze 69 positions and stopped upgrading its heating system.) And yet a year at Murray State still costs only $3,436. Including state and federal financial aid, the increased cost over four years is a few hundred dollars. Is that worse, Mr. Alexander asked, then the private Vanderbilt University's 5 percent increase, to $28,440?
If Congress were to punish the universities that have the highest percentage increases, that would mean attacking ''the very institutions that are the most affordable and accessible throughout the nation,'' Mr. Alexander argued. As his reference to Vanderbilt suggested, public colleges think they're taking an unfair proportion of the heat on the tuition issue.
One source of the tension is that public colleges, once a low-cost alternative to private colleges, are falling behind in quality because of state spending cuts. According to the researchers Peter R. Orszag and Thomas J. Kane, per-student spending at state institutions dropped from 70 percent of that of private colleges in 1977 to 58 percent in 1996 -- and the gap has surely grown since. Professors' salaries are less and less competitive with those at private colleges, causing a slow bleed of talent; class sizes are swelling; and low-paid adjuncts teach more courses. ''If politicians want to bash private higher education for raising tuition, they actually have a right to do so,'' says Ronald G. Ehrenberg, director of the Cornell Higher Education Research Institute. ''In private higher education there may well be waste. Especially at these selective places, there isn't any force to keep costs down.'' But at state colleges, he says, the cuts have long since moved from fat to muscle.
Differences are emerging at the policy level, too. Many private-college officials want the government to allow college students to borrow more money through federal programs to pay for their educations. But the American Association of State Colleges and Universities argues that heavy borrowing to attend a private college is a luxury -- and a burden on students -- and federal money would be better directed toward Pell grants and other services for poor students. Being able to attend Columbia University (tuition and fees: about $30,000), they say, is not a public policy issue or a moral imperative.
3. Colleges are both inescapably expensive to run and inefficient.
Here's the colleges' line: The things colleges need to buy to do what they do -- the time of highly educated people, new computers, laboratories and dormitories -- are all rising in cost far faster than families' abilities to pay. And so college officials argue that higher education must be viewed like health care: Unless you want to go back to the days before antibiotics (and to registration, by hand, in the gym) you have to get used to it getting more expensive every year.
Even if that's so, consider what happened in 2002 when Governor-elect Mitt Romney of Massachusetts, facing a $2 billion budget deficit, asked the business analysts at Bain & Company to identify potential sources of savings in the higher-education system. The Bain team found that, unwittingly, different campuses were spending very different amounts on administration, maintenance and other expenses not directly related to the classroom. Fitchburg State spent 35 percent more than Framingham State, though the institutions serve similar purposes and students. If the inefficient colleges borrowed the practices of their slightly more efficient peers -- not even of the most efficient colleges -- the system could save $100 million a year.
How did the colleges react to the visit from the Bain crew? ''It wasn't a warm reception,'' says Ron Kermisch, the vice president who led the team.
Frank Newman, director of a higher-education policy group at Brown University called the Futures Project, would not have been surprised. He told Mr. McKeon's committee, ''Academics often argue that even to think in terms of efficiency is to fundamentally misunderstand the nature of the collegiate enterprise.''
In his book ''Tuition Rising: Why College Costs So Much,'' Dr. Ehrenberg recalls arguing against building an extraordinarily expensive new science building as well as new squash courts and a boathouse at Cornell. He was always outvoted: like other top private universities, Cornell pursues near perfection across the board, unable to say no to any expense that might lure a star professor or a high-SAT-scoring student. The trick in rooting out inefficiency, he says, is to separate the things that are inefficient in a good way, like a classics department, from the things with no purpose.
4. Damage is creeping up the income ladder, but the poor are being hurt the most.
Some scholars of higher education lament that in the 1990's, the focus of federal higher-education policy swung from poor families to the middle and upper-middle classes. President Bill Clinton sought, and got, tax credits for such parents with children in college, now worth $6 billion a year; those tax cuts softened the tuition increases of recent years for anyone who pays federal tax. Whole states like Georgia created scholarship programs to keep bright, not-necessarily-poor students from leaving the state to attend college. Even colleges that get good press for reducing their tuition by a few thousand dollars -- Muskingum College in Ohio, for example -- are in part trying to attract students who are wealthy enough to just about pay the full freight, according to higher education economists.
Meanwhile, despite a significant increase in recent years, the average Pell grant, the chief federal aid scholarship, has gone from covering 77 percent of the cost of a four-year public college in 1980 to 40 percent today. Even with all the other aid that's out there, that would force poor students to take out more loans, a particular burden to them. In fact, many react to higher tuition costs not by taking out more loans, as the middle class does, but by forgoing college. In the study that Mr. McKeon often cites, an expert committee appointed by the Education Department reported that the students hurt most by rising tuition were those with incomes under $25,000, with the effects extending to those with incomes up to $50,000.
Gordon Winston, an economist at Williams College, told Congress that poor ''stars'' were doing well -- through scholarships awarded by private colleges -- but ''the good-but-not-great low-income kid, and the average, are being lost.''
It's ''not a crisis'' if the top half of the income bracket has to pay more for a public education, writes Sandy Baum, the Skidmore economics professor. But paradoxically, it's the wrath of the upper middle class that has helped galvanize lawmakers: Students who once thought private education was their due find that rising debt makes it a painful choice.
5. Colleges aren't sitting on their hands.
What can be done about the ''cost side of the equation''? Some ideas tinker around the edges -- more colleges, including almost all the private ones in Wisconsin, are banding together to leverage buying power and drive down the cost of everything from health insurance to information-technology support. Maryland's public colleges have proposed a way to reduce the unpredictability of tuition increases and prevent last-minute raids on their budgets: The state and colleges would outline financial commitments to one another several years in advance. The state would pledge a certain dollar amount; colleges would set cost-cutting targets.
But other changes involve a deeper restructuring of the academy. The Pew Foundation, for example, is helping 30 colleges nationwide rethink how they teach introductory courses like Econ 101, which collectively enroll about a fourth of their students. Through the smart use of technology -- frequent online quizzes to make sure students are digesting material -- and by tapping successful upperclassmen to tutor struggling freshmen and sophomores, the pilot courses have raised passing rates and cut costs by more than a third. And there are more radical ideas floating around -- one campus in each state concentrating on science, say, to reduce the duplication of costly labs.
In the private arena, Ronald Ehrenberg argues that only one thing would end the arms race among colleges: a pact among the richest colleges to hold the line on costs. A slowdown in tuition increases at the top would ripple downward, since it would simply be too embarrassing for second-tier colleges to charge much more than Harvard.
If such changes don't reverse the course of rising tuition and legislatures don't rethink their budget cuts, something else will have to give. What will it be? Tenure? The quality of public education? America's promise that low income won't stand in the way of a college degree? Unfortunately, the answer may come sooner than you think.
