Seeing red

I just see red when institutions start to take away merit based financial aid. My daughter excelled in high school and earned high ACT scores. Her instition did give her merit aid and rightly so. Why not reward high achievers with aid whether the family needs it or not? I support merit based aid to all students.

MMW, at 10:00 am EDT on July 3, 2008

My Comments

I, too, saw some red when I read this article. The statement, “curbing merit aid to financially well-off students” begs the question, “how do you define ‘financially well-off’ students?” I strongly believe that most people who are not college administrators would disagree with the realism of the formulas used by FAFSA and CSS-Profile to determine those who are “financially well-off.” When there are discussions about how expensive higher education is, a common metric used is the percentage of graduates who have debt and what that average debt is — that is indeed a good metric, but in many, many cases the debt that the graduates incur is far dwarfed by the debt that their parents incurred.

I also saw red when I read the statement that “it’s clear that colleges need to increase their aid budgets for low income students.” That may be so, but where will that aid come from? In probably only a miniscule amount of cases do colleges and universities do some serious cost-cutting in order to provide aid for lower income students; what they generally do is to increase the tuition price — meaning that those “financially well off” students (i.e., their parents) will pay more (and borrow more) so that others can pay less.

What I would really love to see is for Tufts and Hamilton, and other like-minded colleges, to stop the practice of giving tuition aid on a non-financial-need basis to the children of their professors and administrators. After all, what’s good for the goose should be good for the gander — and it would be more socially just, right? And for those who would say that free or reduced tuition is part of the expected compensation package, well then, if that is so, why shouldn’t it be taxed?

Doug, at 11:00 am EDT on July 3, 2008

Smoke and Mirrors

This article touts rising SAT scores at Hamilton College as evidence that the College is thriving despite the abolition of merit scholarships.

But the author of the article and Hamilton’s dean of admissions neglect to point out that in a related move to promote “diversity” Hamilton has become SAT optional. Check the SAT website and you’ll learn that only 59% of admitted students now submit their scores. That number is slightly down from previous years.

More smoke and mirrors from the school that brought us Susan Rosenberg, Ward Churchill, and Annie Sprinkle.

Send your kid to SUNY-Geneseo. Its better and much cheaper.

Hamilton Alumnus, at 1:30 pm EDT on July 3, 2008

I talked about this phenomenon on my blog. SAT Optional isn’t just about snubbing the SAT. It’s also about filtering out kids who have scored poorly.

http://www.omniaceducation.com/bl...forest-gets-the-best-of-both-worlds/

Mark Truman, SAT Scores us at SAT optional Schools at Omniac Education, at 3:15 pm EDT on July 3, 2008

Lots of well-considered comments here. I’m sure most realize the less well-represented (in this line of commentary) arguments for increasing diverse access to college—low income students (the lowest of which are largely students of color in the US) encounter a number of major hurdles to high GPA and SAT scores/college aspiration and prep and therefore, though some of them have excellent potential, they may need a helping hand. While need-based financial aid is only a starting point for these folks, it is important. My personal hope is that many who are able to take advantage of these opportunities return to their communities with the understanding and will necessary to support better education, less violence, and greater/better participation in our struggling economy. I, too, would like to believe in meritocracy in America, but “merit-aid” really plays into the hands of an aristocracy, and sometimes, granted, the upper-middle class who could also use the dollars.

Let’s separate the issues, though. The high cost of college is a major problem. The high costs of our welfare state is quite another, for which increased need-based aid, necessitating decreased merit aid, is a potential contributory solution.

Also, no one has yet mentioned the role of rankings. As has been said, Hamilton and Tufts are elite schools. Their brands transcend US News fame. Others are not so well-endowed, if you pardon the pun. That many selective, mildly selective, and non-selective (about 70-80% of all higher ed—Bok) institutions feel beholden to US News is a travesty. I am all for simplifying and summarizing info for applicants, but when it restricts the actions of what I would characterize as a majority of non-profit colleges, we have a major problem. The good of the invested students and the good of the invested public must be made to prevail.

Wossamotta U., at 11:55 am EDT on July 4, 2008

With two kids in college this September and a combined annual tuition bill of $60,000+, and a gross income of approx $85,000 the only “need” based aid we received is a $1,000 subsidized loan. The formula used to determine “need” needs to be reworked. I know people with equal or higher incomes that qualify for much more “need” than we do because rather than invest in savings, etc. they spend what they earn. They drive nicer and newer cars, wear more expensive clothes, eat out more often and have all the latest high tech gadgets. The formula doesn’t take into account that both my husband and I drive vehicles which are more than 10 years old with more than 100,000 miles each, nor the fact that we brown bag lunches and shop at discount stores. Instead, I am penalized because I invested in real estate (which is my retirement investment) rather than IRAs. I made a choice to invest in real estate. In order to afford the investment, we chose not to have cable t.v., restaurant meals, designer clothes, etc. I am penalized because we limited our family size and spaced our children 3 years apart. My kids both worked their butts off taking AP and honors classes and earning top grades in them in order to EARN merit scholarships. Once earned, they are harder to retain than need based aid becausae they require much higher GPAs to renew them each year. They will still graduate with a substantial amount of student loan debt and must work thru college if they want any spending money. So, yes, I am annoyed that “merit” aid is considered as being wrong and unreasonable. Meanwhile we continue to “reward” those in our society who make poor decisions, overspend, undersave, and expect that their needs should be society’s responsibility.

Linda, at 6:20 am EDT on July 5, 2008

Gapping, need-based aid, and merit scholarships

I’m surprised that the topic of “gapping” has not been raised. Much of the dissatisfaction with “need-based” aid awards may be due to the widespread practice of gapping, that is, the deliberate under funding of middle-income students on whatever basis need is determined.

The flip side of “merit-based” awarding to more affluent students to get them to enroll (it saves the institution money and tends to raise mean SATs) is the under funding of needy middle-income students who may be more likely to enroll anyway (they may have lower SATs and fewer offers from other schools).

Unless a college meets full need for four (or five) years, as fewer than 100 colleges are able to guarantee, then students may have to drop out, or students and parents will be forced to borrow more than they should. Empirical studies (Baum) show that most students shouldn’t be borrowing more than $25,000 over four years. Middle-income parents should probably not be borrowing over four years more than 10-15% of their income during that period. For example, parents an annual income of $100K with average assets and one child in college should typically borrow less than $15,000 per year for any private or public college (many state universities may also leave large gaps in funding).

Because of gapping, many students and middle-class families may be choosing colleges that they cannot afford and that may lead to debt levels that are excessive. The alternative is that these families should select lower-priced colleges or select colleges that meet closer to full need. The first is often a difficult decision about educational environment, and the second may be available to only highly-competitive middle-income students.

Need-based aid would likely be more acceptable to middle-class families if fewer colleges gapped. Merit aid at colleges that gap takes money that might have been available to middle-income families so that aid may be redistributed to finance low-income students (federal and state has not kept up). The problem then is that institutions cannot afford to meet all of their enrollment goals for enrolling middle-income students, and discounting cost to the more affluent is a way to offer opportunity to top low-income students who could plainly not afford to attend otherwise.

The result of the rising high cost of colleges is that few colleges can afford to avoid gapping, and most must use no-need merit awards in order to be able to finance talented low-income students with need-based merit awards. Middle-income families have to face limited choices among lower-cost alternatives or risk amassing crippling debt. Not a pretty public policy picture for families in this country, but one that is a clear result of escalating college costs without the matching resources to support need-blind admission and equal opportunity for all based upon the talent to excel in college.

Bob, at 4:35 pm EDT on July 6, 2008