March 29, 2007

College for Whom?

By Alan Contreras

“[By] the 1960s … we had reached the point where virtually all smart youngsters were going to college. Only the stupid or the poor were not going on to college.”

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—Daniel Patrick Moynihan, in his essay “The Travail and Fall of Higher Education.“

We can do little about the stupid except to hope that they decrease in number though socially acceptable methods, but the United States in the late 1960s established a goal of providing low-income students with 25 percent of the cost of their college education. This goal has, of course, been long-since abandoned by politicians of all subspecies, since loans don’t count as providing anything. Yet the underlying issue remains to be solved: How should a civilized society ensure that college-able young people are not thrown away because they are poor?

Poor, of course, also means something different now than it meant in 1966: College is priced higher today than it used to be. This is true not just in terms of sticker value, but in terms of the cost of college vs. the ability of people to earn money.

In 1974, a year of attendance at the University of Oregon (the flagship university in my state) cost what a student working minimum wage could earn working 27 hours a week, year-round. That is a lot of work for a full-time student during the school year, but was not impossible and could be offset by more work hours in the summer.

By 2004, a full-time student would have to work 46 hours a week to pay for the same attendance. That is essentially impossible, cannot be sufficiently offset by summer earnings and is the fundamental gap that policy makers either don’t understand or choose to ignore because it is too depressing and can’t be fixed.

It is therefore disingenuous for policy makers to repeat the tired theory that “if I worked my way through college, why can’t today’s students?” Because they can’t. There aren’t that many hours in the day.

A recent study by the Oregon Public Interest Research Group showed that from 1993 through 2004, average student loan debt increased by 115 percent, while the cost of living in the Willamette Valley, where most of Oregon’s college students live, went up only 32 percent. In addition, the percentage of public university students who had to borrow to attend college rose from 46 percent in 1993 to 62 percent in 2004. At private colleges, the figure was 72 percent.

Of those graduating from a public university, 37 percent could not make debt payments on the starting salary of a social worker, and 23 percent could not make such payments as a public school teacher. What this means is that the cost-benefit analysis of college is shifting in a way that discourages people from entering those professions. How is our society supposed to fill such jobs in the future? How will we succeed in meeting state and federal expectations that we will obtain and retain well-qualified teachers when even those who want to be teachers cannot afford to be?

The economics of the labor force and the economics of postsecondary education have both changed. Even at community colleges, tuition has gone up faster than any measure of personal income. Society has decided that providing access to college for people with incomes below the upper middle class costs more than it wants to pay for. The upper middle class won’t pay for the poor and lower middle class to go to college any more. The middle class can hardly afford it themselves, owing to cost and their own spending and saving habits.

Instead, we have a system of grants that are helpful but that do not cover the cost of tuition. These are limited to the lower income brackets. To this are added overlapping layers of subsidized and unsubsidized loan programs, all of which have the effect of requiring many students to become debtors at a level unimaginable 20 years ago, just to stay in school at all.

What can colleges do about this? Very little, unless they have the boldness to adopt differential pricing by major. State legislators and some federal officials hold hearings into the reasons why college costs have gone up so much, while simultaneously refusing to underwrite college degree programs at a level sufficient to cover the same proportion of costs as government did in the 1970s.

This disingenuousness has become so common that it has attained nearly a ritual quality. Only the sheer crudeness of political power over postsecondary education, especially in the public sector, keeps college leaders all over the country from pointing out more forcefully that Congress has no clothes, nor do many legislatures.

Another Possibility

One other thing can be done, and that is to refocus institutional fund-raising efforts around the need to achieve independence from government handouts and subsidies. If the government is going to play its silly hide-the-facts game indefinitely, while students stagger under an increasing debt load, then colleges need to build their endowments to the point that they can uncouple themselves from government rules.

This is difficult and expensive, but it can be done. Even now, Harvard has decided to charge no tuition to students with a family income less than $60,000. That may not be very many students, given Harvard’s catchbasin, but it is a start. Princeton and the University of Pennsylvania have similar policies.

Can this approach work for the nation’s hundreds of large public universities and community colleges? In most cases, no. However, these schools are no longer what they were in many cases supposed to be: colleges accessible to anyone. They are relatively expensive, vaguely effective job-training programs mated to a mildly structured social life for teenagers, with a partially sealed superstructure of research faculty and graduate programs standing on stilts above the teeming swarm.

At smaller colleges that are focused on student learning, creative methods can be used. Two of the best-known schools that don’t charge tuition (or at which it is all covered by scholarships) are College of the Ozarks, a traditional four-year religious college in southern Missouri, and Deep Springs College, which operates a very small two-year college for men at a ranch in the desert of southeastern California.

Both of these are “work schools” in which students keep the school operating, especially in the case of Deep Springs, in which the students actually do much of the work running the ranch. This is a model that should be tried elsewhere, as this excerpt from the Deep Springs Web site in July 2006 shows:

“In the past 10 years, 16% of students transferred to Harvard, 13% to the University of Chicago, 7% to Yale and 7% to Brown. Other schools frequently attended after Deep Springs include Columbia, Oxford, Berkeley, Cornell and Stanford.In the past five years Deep Springers have won the following national scholarship competitions:

• The Jack Kent Cooke Scholarship (2)
• The Barry M. Goldwater Scholarship (1)
• The Rhodes Scholarship (1)
• The Harry S. Truman Scholarship (5)
• The Morris Udall Scholarship (1)

... Over the long term, over two-thirds of our alumni have earned graduate degrees, with over half holding a doctorate (M.D., J.D., Ph.D., etc.) as their terminal degree.”

The student body consists of 26 students, which gives you an idea of what can happen at a very small school where quality means something. College of the Ozarks and Berea College, in Kentucky (once led by Robert Maynard Hutchins’s father), are somewhat larger, but have for many years shown that the “work school” concept is effective.

One additional step can be taken to realign access and cost with external reality: adopt market-based pricing. Given the significant difference between the ability of students who earn different degrees to repay huge loan burdens, it is time for a serious discussion of charging less for classes in English and History at the undergraduate level than for classes in business or computer science. This would also require adjusting faculty pay scales, with pay for geography professors dropping by ten percent and pay for nursing professors going up by 15 percent, to pick numbers arbitrarily.

I am told that having such differential pay scales would be horribly destructive to faculty morale and institutional cohesion. On the contrary, I think it would release a lot of pressure within institutions, pressure that finds other methods of reaching the surface. Why should universities think themselves immune from the economic realities under which all other organizations work? Even if the transition period were difficult, the positive effect on students would be so great (in financial terms) that any university that is truly student-oriented should take the idea seriously.

Private colleges with any capacity to build an endowment should be able to focus resources this way. Instead of adding more buildings, more programs or more sports, systematically devote income to tuition offsets until the cost of attendance is a minor issue for anyone who might want to go. If we are serious about basing access on academic merit, we must stop pretending that the financial wall does not exist. It does, and with a very few exceptions, merit by itself is not enough to overcome the money wall.

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