Government can overestimate college costs

Federal listing of college costs often fail to calculate the rising supplements provided by student aid, grants, and loans.images

As the New York Times reports, “The government’s official statistic for college-tuition inflation has become somewhat infamous. It appears frequently in the news media, and policy makers lament what it shows.No wonder: College tuition and fees have risen an astounding 107 percent since 1992, even after adjusting for economywide inflation, according to the measure. No other major household budget item has increased in price nearly as much.But it turns out the government’s measure is deeply misleading.

“For years, that measure was based on the list prices that colleges published in their brochures, rather than the actual amount students and their families paid. The government ignored financial-aid grants. Effectively, the measure tracked the price of college for rich families, many of whom were not eligible for scholarships, but exaggerated the price – and price increases – for everyone from the upper middle class to the poor.The good news is that the Bureau of Labor Statistics has gradually begun to change its methods since 2003, to capture the effects of financial aid. It will take more time to know how well those efforts are working. But the bureau won’t alter the historical data, which means the long-term comparisons will never capture the actual cost of college for American families.

“Those oft-cited comparisons, notes Sandy Baum, a George Washington University professor and an expert on college costs, says, are “certainly misleading.”

“The discrepancy matters because the country is in the midst of a roiling debate about whether college is worth it. Various pundits on both the left and right have taken to claiming that higher education is overrated and often not worth it. The shocking increase in college costs, according to the official Bureau of Labor Statistics numbers, is part of their argument. Continue reading “Government can overestimate college costs”

What is merit, anyway?

As college presidents went to the White House Thursday to talk about new efforts to attract more low-income students to higher education,admissions leaders gathered here and talked about how they define merit.

InsideHigherEd asks, “Who is admitted? Who gets aid? When spots and the aid budget are limited, who gets priority status?

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“Speakers turned to definitions (from dictionaries, Latin and Greek) and to philosophy, and generally agreed that merit in higher education must mean more than having the highest grades and test scores. But beyond that, things get complicated. Recruiting a more socioeconomically diverse class is a great thing, everyone seemed to agree at the annual conference of the Center for Enrollment Research Policy and Practice of the University of Southern California.

“But is that still the case if your rankings slip and your SAT average drops a smidge? Nancy Cantor, who spoke here, was described as heroic by many for doing that at Syracuse University. But Cantor has left Syracuse and her successor seems much more interested in rankings than she was. And for institutions that compete for students, decisions that might be applauded here as ethical can be quite difficult. A case study was presented by Jenny Rickard, vice president for enrollment at the University of Puget Sound. She described how Puget Sound, between the 1970s and today, evolved from a local commuter college to a national liberal arts college, attracting increasingly competitive students.

Continue reading “What is merit, anyway?”

Public universities cutting student aid

Public colleges and universities were generally founded and financed to give students in their states access to an affordable college education.images

The Chronicle of Higher Education reports that this seems to be be changing.

“They have long served as a vital pathway for students from modest means and those who are the first in their families to attend college. But many public universities, faced with their own financial shortfalls, are increasingly leaving low-income students behind—including strivers like Ms. Epps.

“It’s not just that colleges are continuously pushing up sticker prices. Public universities have also been shifting their aid, giving less to the poorest students and more to the wealthiest. A ProPublica analysis of new data from the U.S. Department of Education shows that, from 1996 through 2012, public colleges and universities gave a declining portion of grants—as measured by both the number of grants and the dollar amounts—to students in the lowest quartile of family income. That trend continued even though the recession hit those in lower income brackets the hardest.

“Attention has long been focused on the lack of economic diversity at private colleges, especially at the most elite institutions. What has been little discussed, by contrast, is how public universities, which enroll far more students, have gradually shifted their priorities—and a growing portion of their aid dollars—away from low-income students. State colleges are typically considered to offer the most affordable, accessible four-year education students can get. When those institutions raise tuition and don’t offer more aid, low-income students are often forced to decide not just which college to attend but whether they can afford to attend college at all. “The most needy students are getting squeezed out,” said Charles B. Reed, a former chancellor of the California State University system and of the State University System of Florida. Continue reading “Public universities cutting student aid”

Accounting for victims

images-2There are a number of tools economists, government agencies and lawyers use to translate a death or injury into financial terms, says today’s Wall Street Journal. “These include deriving estimates from surveys about how much value people would place on, say, losing a limb or their sense of hearing; creating a life plan for medical care to estimate long-term expenses; and basing the value of a lost life on how many years it likely would have lasted if not for the unforeseen event that ended it. Feinberg said ze doesn’t take any of these into consideration. “It simply is not doable in the timeframe needed to streamline the program and get money out the door,” ze said. “I don’t think external resources are going to help you very much in what is essentially an emotional assignment.”

“As for parsing such factors as the age of victims, Feinberg said, “Spare me. You’re tying a program like this up in knots.” Ze added, “There is no substitute for getting money out the door.”

“Also, no donors specifically indicate they want their contribution to go to the neediest victims, Feinberg said.

“Kaitlynn Cates, a marathon spectator who suffered a severe calf injury, said ze understood a “sense of immediacy” demanded Feinberg disburse the funds quickly, and not based on a forensic analysis of need. If one victim was no longer able to provide for five children, “I would be the kind of person who says give it to the five children before you give it to me, but I understand from higher levels that would cause problems,” Cates said. Continue reading “Accounting for victims”

Prestige versus value in college choice

Having a choice is generally a good thing, and being able to choose among several college acceptances should be a wonderful thing indeed, as Paul Sullivan wrote this past week in the New York Timesimages

“But let’s face it: the cost of a college education these days ranges from expensive to obscenely expensive. So the decision is likely to be tougher and more emotional than most parents and children imagined as they weigh offers from colleges that have given real financial aid against others that are offering just loans.

“While some students will be able to go to college only if they receive financial aid and others have the resources to go wherever they want, most fall into a middle group that has to answer this question: Do they try to pay for a college that gave them little financial aid, even if it requires borrowing money or using up their savings, because it is perceived to be better, or do they opt for a less prestigious college that offered a merit scholarship and would require little, if any borrowing? It’s not an easy decision.

Full story: http://www.nytimes.com/2013/04/20/your-money/measuring-college-prestige-vs-price.html?pagewanted=all&_r=0