See Thru Edu is a project of the Texas Public Policy Foundation
Thomas K. Lindsay, Ph.D., Editor in Chief and Director, Center for Higher Education, Texas Public Policy Foundation
A growing number of higher education observers and leaders are focusing on the accumulation of wealth among the larger university endowments and calling for this so-called “excessive” wealth to be taxed in the public interest, and there are rumblings in Congress about bills being drafted to do just that.
As a sitting, non-profit college president who has lived with the realities of both public and private higher education for more than two decades, I don’t share the belief that the sky is falling.
Good education empowers Americans to move up the economic ladder. But today the education system fails millions of low-income students and is no longer the great opportunity equalizer. So it is time to take some sorely needed actions to shake things up.
Over time, there has been growing inequality in resources per FTE student. To add to the irony, students at the most selective institutions pay a much lower proportion of the cost of their education.
For several years I have maintained an informal list of studies finding that funds from government student aid programs are in one way or another “captured” by colleges, universities, or someone other than the students whom the money is supposed to help.
It is the people, living under the economic malaise known as the “New Normal,” who have been forced over roughly the last decade to learn to do more with less. Is it unreasonable, then, that the people might expect our universities to make the same sacrifices?
It has just been reported that Sen. Lamar Alexander (R-TN), chairman of the Senate education committee, will move to revive Perkins for two more years.
Enrollment was dropping at the same time as federal and private grant aid was increasing and high school graduation rates were rising — two trends that higher education advocates hoped would boost college access for poor youth.
Absent the current, de facto federal lending monopoly, private lenders and students would have strong incentives to work together – both would stand to profit from a partnership. Having government supply aid, in contrast, largely invites rent-seeking, overconsumption, and rampant price inflation.
Subsidy rates tend to be highest at colleges where ticket sales and other revenue are the lowest — meaning that students who have the least interest in their college’s sports teams are often required to pay the most to support them.
