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Post by sader1970 on Sept 17, 2020 7:06:19 GMT -5
The college money crisis
The coronavirus has caused severe budget problems for American higher education. But many colleges’ financial troubles are much larger than the virus. They have been building for years and stem, above all, from a breakdown in this country’s hodgepodge system of paying for higher education.
Given the importance of higher education — for scientific research, entrepreneurship and ultimately American living standards — I want to use today’s newsletter to talk about this breakdown.
The current system arose after World War II and depended on three sources of money: students (and their parents); the federal government; and state governments. Of those, state governments were supposed to provide the most money. That’s why many Americans attend something known as a state college.
Over time, though, state officials came to a realization. If they cut their higher-education budgets, colleges could make up the shortfall by raising tuition. Many other state-funded programs, like health care, highways, prisons and K-12 education, have no such alternative.
“In every economic downturn since the 1980s, states have disproportionately cut college and university budgets,” Kevin Carey writes in a new Washington Monthly article that offers an exceptionally clear description of the problem. Since 2008, states have cut inflation-adjusted per-student spending by 13 percent, according to the Center on Budget and Policy Priorities.
These budget cuts have left most colleges struggling for resources, even as elite colleges, both private and public, can raise substantial revenue from tuition and alumni donations. Not surprisingly, inequality in higher education has grown. Many poor and middle-class students who excel in high school attend colleges with inadequate resources and low graduation rates — and end up with student debt but no degree.
And research repeatedly shows that college matters: Graduates are more likely than nongraduates to be employed, to earn good salaries, to be happy and to live long lives.
The decline in state support for higher education is unlikely to reverse itself, and most middle-class families can’t easily afford to pay rapidly rising tuition bills. That leaves the federal government. A central question, then, is whether it will step in — or whether a college education will become ever more of a luxury good.
Potential solutions: Joe Biden has proposed a big expansion of federal support for higher education, which would make college free for any family earning less than $125,000 a year. President Trump does not have a plan to make college less expensive.
Carey, who works at the New America think tank, argues that Biden’s plan sends too much money to elite colleges that don’t need it. Carey instead proposes a new federal program in which colleges — including community and technical colleges — could choose to receive more funding in exchange for charging a simple, affordable tuition.
Source: The New York Times "The Morning" (daily blurb)
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Post by longsuffering on Sept 17, 2020 11:09:03 GMT -5
Something has to give. It is similar to healthcare where the absurd rate of price increases are camouflaged by Government and employer subsidized health insurance covering most of the cost. Student loans and government subsidy camouflages the price increases in higher education that have been way higher than inflation and the rise in average income.
Despite the above inflation price increases, a number of hospitals and colleges are threatened with closing. On the other hand, bare bones/no frills entities like Walmart, Amazon, etc. are thriving.
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Post by longsuffering on Sept 17, 2020 15:12:18 GMT -5
Is our standard of living on the decline? Walmart, Costco,Bj's etc. It seems a lower percentage of folks are shopping at middle income places like Macy's ( Macy's stores have changed their inventory to include lower priced items but is barely surviving.) B Altman, Wallachs, Lord& TaylorI among others all closed. Mall shoppers dressed in RELATIVELY cheaper sweat clothes, etc. Fairway, Balducci's and other premium markets closed. Airline passengers dressed down in sandals, wrinkled shirts and blue jeans/shorts. Schrafts and other mid level luncheonette restaurants replaced by Mickey D's , etc. And there is more. These changes in dress and shopping habits may be due to changes in fashion but the underlying cause may be lack of money which birthed new styles. Add to the list cars, houses, rent, private schooling, etc. Today many families require two earners - mom& dad to survive. Health care?A factory worker used to be able to buy a home, provide food on the table, kids' education and a vacation. Is it merely a changing market with different choices by the consumer? Or, is it more. Admittedly, we have more great tv's, cable tv. cell phones, other entertainment options and more clubs, cruises, etc. It seems to me most heretofore middle class retail items are beyond the reach of the average earner. Our culture seems increasingly coarser, more vulgar. I have watched this trend of less expensive/cheaper wares grow for many years. Is this a natural outgrowth of our capitalism/free markets( Rest assured I am not an anti-capitalist.) No doubt, my comments are wide ranging. Maybe it is the bleat of an old goat, resistant to change. But I do miss many of the niceties of the past. You are bleating to the correct beat. Now today Senators Schumer and Warren have urged President Trump to offer "broad forgiveness" of student debt. That's not the answer. |
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Post by KY Crusader 75 on Sept 17, 2020 15:48:59 GMT -5
I believe things have been getting more affordable if you believe that median income is an indicator of such
All data indexed for inflation to 2019 $$$ ($1,000)
1980. $56.7
1990 $58.4
2000 $61.1
2010 $58.0
Now some recent data year by year
2015 $56.9
2016 $ 59.0
2017 $61.6
2018 $62.3
2019 $ 63.0
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Post by Pakachoag Phreek on Sept 17, 2020 18:28:03 GMT -5
US economic and social data compared to 39 other predominantly First World, industrialized countries. Data is from 2016.Household net adjusted disposable income. 1 of 40 > Social inequality of this measure 35 of 39 Employment rate 19 of 40 Employees working very long hours 29 of 40 Educational attainment 8 of 40 Years of education: 26 of 40 (17.2 years, first grade through post-secondary) Life Expectancy 28 of 40 Time devoted to leisure and personal care 30 of 40 Source: www.oecdbetterlifeindex.org/countries/united-states/#:~:text=It%20represents%20the%20money%20available,highest%20figure%20in%20the%20OECD. Disclaimer: Once upon a time, I was a subject matter expert for the OECD. |
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Post by DFW HOYA on Sept 17, 2020 20:11:44 GMT -5
Public colleges were never designed to be for all and by all.
My late father was one of three brothers who attended B.M.C. Durfee HS in Fall River (a city that's been in a downturn for the last 110 years or so). None of the three went to college. If you didn't join the military after high school (all three did) you got a job at a factory or whatever mills were still open. College was something you did if you wanted to be a doctor or lawyer, but that was it. Fall River had its share that made it to Holy Cross and maybe a few more to Providence, but college wasn't required for a career and it only put off a marriage and family for four more years. State colleges were either for agriculture (UMass-Amherst) or teachers colleges. Very few women went to college and if someone was black, even fewer.
Today, the expectation is that every high school grad, men and women, are supposed to go to four year colleges, or as it has been called, "extended high school". Others will go on to grad school, even if a career doesn't require it.
The cost of maintaining colleges has outstripped the ability to pay. HC and schools like it are approaching a $100,000 price tag this decade. And the only way this changes is one of three disruptive changes:
1. Private colleges go to a Regis High School model of free tuition, with sharply lower costs for faculty and staff;
2. State governments heavily subsidize free public education via higher taxes; or
3. Employers no longer demand college as a prerequisite for a first job and accept certificate courses as a substitute, bringing the demand for the state systems way down.
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Post by princetoncrusader on Sept 17, 2020 21:12:15 GMT -5
Colleges and universities could also cut their bloated non-academic staffs. HC has last I heard 46 people working in the development office. At the Univ. of Michigan, 26 members of the diversity staff made more than $100k in cash compensation.
My late dad was a Regis grad. Very few high schools or colleges have that kind of loyal and generous alumni base.
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Post by KY Crusader 75 on Sept 17, 2020 21:42:48 GMT -5
Colleges and universities could also cut their bloated non-academic staffs. HC has last I heard 46 people working in the development office. At the Univ. of Michigan, 26 members of the diversity staff made more than $100k in cash compensation. My late dad was a Regis grad. Very few high schools or colleges have that kind of loyal and generous alumni base. Nice examples. I’d love to see data on # of employees over the years broken down into the proper buckets Academic-people who teach Academic support staff Diversity & inclusion Business staff Counseling / student support I T Fund raising Library Athletics Building ,grounds , maintenance Food service Etc No doubt I have missed some categories, but you get the idea. No doubt categories like Athletics, D & I, and academic support staff have grown at a dramatically faster rate than professors or the buildings & grounds crew |
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Post by longsuffering on Sept 17, 2020 21:47:26 GMT -5
"Never waste a crisis." The pandemic offers the opportunity to restructure staffing back to an efficient necessary core.
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Post by Chu Chu on Sept 18, 2020 12:48:05 GMT -5
I believe things have been getting more affordable if you believe that median income is an indicator of such All data indexed for inflation to 2019 $$$ ($1,000) 1980. $56.7 1990 $58.4 2000 $61.1 2010 $58.0 Now some recent data year by year 2015 $56.9 2016 $ 59.0 2017 $61.6 2018 $62.3 2019 $ 63.0 The median is the middle number in a sorted, ascending or descending list of values. As such, it is distorted when there are very high or low values way outside the norm. That is exactly the case with income in the US. Over the last generation, we have seen most peoples income stagnate, while a sliver (the 1%) have increased their income many multiples of times. For this reason, the median income in the US tells you nothing about the affordability for the large majority of folks. |
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Post by KY Crusader 75 on Sept 18, 2020 15:10:55 GMT -5
I believe you are 100% wrong. Your objection to the measurement sounds like the common, and usually correct, objection to the use of the "average" when evaluating a group of numbers. The median number is not distorted by high or low numbers---.
I do not believe we have seen most incomes stagnate--the median number tells the story. While the highest paid individuals, the top 1%, may have seen (making this up) their income go from, say, $400,000 a year to $500,000 a year, that does not affect the fact that the guy or gal in the middle (teacher, fire fighter, production worker, secretary, whatever) went from $56.9 in 2015 to $63.0 in 2019.
I spent many, many years working with averages, medians, modes, and low and high outliers in my marketing and sales career.
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Post by Pakachoag Phreek on Sept 18, 2020 15:44:46 GMT -5
I believe you are 100% wrong. Your objection to the measurement sounds like the common, and usually correct, objection to the use of the "average" when evaluating a group of numbers. The median number is not distorted by high or low numbers---. I do not believe we have seen most incomes stagnate--the median number tells the story. While the highest paid individuals, the top 1%, may have seen (making this up) their income go from, say, $400,000 a year to $500,000 a year, that does not affect the fact that the guy or gal in the middle (teacher, fire fighter, production worker, secretary, whatever) went from $56.9 in 2015 to $63.0 in 2019. I spent many, many years working with averages, medians, modes, and low and high outliers in my marketing and sales career. Au contraire. Most incomes have declined. Share of Aggregate Income Received by Each Fifth and Top 5 Percent of HouseholdsLowest fifth / Second fifth / Third fifth / Fourth fifth / Top fifth / Top 5 percent 1977 4.2 / 10.2 / 16.9 / 24.7 / 44.0 / 16.9 1990 3.8 / 9.6 / 15.9 / 24.0 / 46.5 / 18/5 2005 3.4 / 8.6 / 14.6 / 23.0 / 50.1 / 22.2 2019 3.1 / 8.3 / 14.1 / 23.7 / 51.9 / 23.0 Sixty percent of households have seen a steady decline, another 20 percent, the upper middle class is barely holding its own, whereas the rich and near-rich spend their evenings counting the rewards of their good fortune. The top 20 percent's share of income exceeds the total share of the other 80 percent of households. www.census.gov/data/tables/time-series/demo/income-poverty/historical-income-households.html |
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Post by KY Crusader 75 on Sept 18, 2020 16:06:54 GMT -5
The median income increased. It's simply a fact.
Some comments:
You are also looking at "share of aggregate income" not at $$ income indexed to 2019 as I did. 14.1% of the aggregate income for 2019 (middle quintile) may well be higher than 14.6% of the aggregate income for 2005 (indexed to 2019)
I note also that you used different years than I did--makes comparisons difficult
How does your analysis account for people moving from one quintile to another?
If you're making, say, $75,000 a year and your boss makes $400,000, would you rather his income decline and yours remain the same, or have your income go to $80,000 a year while he gets the bump to $450,000?
I know you know all the answers to the questions I posed--just wanted you to know I understand what you are doing.
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Post by sader1970 on Sept 18, 2020 18:40:02 GMT -5
I'll let you guys slug it out on averages, mean, median and mode. Those days are behind me now.
Now, just to put a slightly different slant on the discussion, I found a site that is an inflation calculator. You know, plug in an amount and a year and it calculates what that amount would be in 2020 dollars.
I don't recall exactly what the cost of tuition, room and board are currently at Holy Cross but pretty sure it is well north of $50,000.
So, here's how those expenses increased in "real" dollars over 3 generations of Crusaders. These numbers are approximate because they are based on my memory, always suspect nowadays.
My father and/or grandfather told me that tuition, room and board for my father (HC '1942) was a whopping $500 a year.
When I graduated in 1970, those expenses were $2,500 +/- (annual increases might have gotten to $2,700).
My son graduated in 1998 and those expenses were $25,000 +/- a year.
So, in 2020 dollars:
1942: $7,973
1970: $16,747
1998: $39,865
So, yes, it costs much more for a Holy Cross education than it used to in real dollars.
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Post by Chu Chu on Sept 18, 2020 19:32:36 GMT -5
Ky, As I understand this, in the case we are talking about, the extremely high incomes of the super wealthy mean that the middle number (median) is dragged upwards and away above where the large majority of incomes are. The average (mean), will be lower, even though the mean is also affected.
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Post by Chu Chu on Sept 18, 2020 19:39:57 GMT -5
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Post by KY Crusader 75 on Sept 18, 2020 19:47:53 GMT -5
Typed this while chu chu was typing his response above
Let’s say there are 22 guys in a group. We record their heights
1 is 5-4
2 are 5-6
4 are 5-8
8 are 5-10
4 are 6-0
2 are 6-2
1 is 6-4
The median height of the group is 5-10
Shaquille O’’Neal, a very tall man, a real outlier, joins the group. We record his height at 7-2
The median height of the group is now....5-10
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Post by hceconhist on Sept 19, 2020 22:53:35 GMT -5
I am surprised this AEI chart has not yet been shared. While some have picked some bones with Mark Perry's methodology (e.g., difference between list prices and what consumers actually pay - such as prescription drugs), it shows that some goods and services (e.g., mass-marketed technology) are more affordable than ever for a majority of US earners, many are more out of reach (e.g., higher education!) than ever.  |
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billyball
Climbing Mt. St. James
Posts: 78
Member is Online
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Post by billyball on Sept 20, 2020 5:01:15 GMT -5
Colleges and universities could also cut their bloated non-academic staffs. HC has last I heard 46 people working in the development office. At the Univ. of Michigan, 26 members of the diversity staff made more than $100k in cash compensation. My late dad was a Regis grad. Very few high schools or colleges have that kind of loyal and generous alumni base. |
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Post by KY Crusader 75 on Sept 20, 2020 10:11:49 GMT -5
I am surprised this AEI chart has not yet been shared. While some have picked some bones with Mark Perry's methodology (e.g., difference between list prices and what consumers actually pay - such as prescription drugs), it shows that some goods and services (e.g., mass-marketed technology) are more affordable than ever for a majority of US earners, many are more out of reach (e.g., higher education!) than ever. View AttachmentFascinating and highly useful information. It’s good to see that wages have increased by more than inflation over the period. Your point about list price versus actual price paid is a critical one |
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Post by efg72 on Sept 20, 2020 15:53:21 GMT -5
Especially for drugs. Pricing is complicated in healthcare because of rebates and discounts insurers demand-few if any are passed on to the consumers.
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Post by alum on Sept 21, 2020 10:22:40 GMT -5
I am surprised this AEI chart has not yet been shared. While some have picked some bones with Mark Perry's methodology (e.g., difference between list prices and what consumers actually pay - such as prescription drugs), it shows that some goods and services (e.g., mass-marketed technology) are more affordable than ever for a majority of US earners, many are more out of reach (e.g., higher education!) than ever. Fascinating and highly useful information. It’s good to see that wages have increased by more than inflation over the period. Your point about list price versus actual price paid is a critical one Food expenditures represent a much smaller percentage of income than they did years ago. In 1960, Americans spent 17% of their income on food. Today it is 9.5%. www.ers.usda.gov/data-products/ag-and-food-statistics-charting-the-essentials/food-prices-and-spending/#:~:text=In%202019%2C%20Americans%20spent%20an,from%20home%20(4.6%20percent). One of the reasons for that is because household incomes have risen because there are more two income families. www.pewresearch.org/ft_dual-income-households-1960-2012-2/ Of course, those two income families have two cars and a house which is twice as big. patch.com/pennsylvania/hellertown/bp--how-a-right-sized-1950s-home-became-a-tight-fit-in-2012 A much larger percentage are trying to send their kids to college than in 1960. We need more earnings because we want more than we did when Dr. Fauci was graduating from HC. College prices keep going up, but I doubt that they will ever approach the pace at which they went up in the 1980's. If I am not mistaken, HC went from $6850 my freshman year to $10,500 my senior year. Of course, there was double digit inflation then. We need an intern to to do research for us. I see no reason why he or she or they could not not get academic credit.  |
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Post by jkh67 on Sept 21, 2020 20:03:04 GMT -5
Public colleges were never designed to be for all and by all. My late father was one of three brothers who attended B.M.C. Durfee HS in Fall River (a city that's been in a downturn for the last 110 years or so). None of the three went to college. If you didn't join the military after high school (all three did) you got a job at a factory or whatever mills were still open. College was something you did if you wanted to be a doctor or lawyer, but that was it. Fall River had its share that made it to Holy Cross and maybe a few more to Providence, but college wasn't required for a career and it only put off a marriage and family for four more years. State colleges were either for agriculture (UMass-Amherst) or teachers colleges. Very few women went to college and if someone was black, even fewer. Today, the expectation is that every high school grad, men and women, are supposed to go to four year colleges, or as it has been called, "extended high school". Others will go on to grad school, even if a career doesn't require it. The cost of maintaining colleges has outstripped the ability to pay. HC and schools like it are approaching a $100,000 price tag this decade. And the only way this changes is one of three disruptive changes: 1. Private colleges go to a Regis High School model of free tuition, with sharply lower costs for faculty and staff;2. State governments heavily subsidize free public education via higher taxes; or 3. Employers no longer demand college as a prerequisite for a first job and accept certificate courses as a substitute, bringing the demand for the state systems way down. I'm a Regis ('63) and HC ('67) grad (as is my brother Tom: Regis ('68); HC ('72)). For what it's worth, I've been an ardent HC supporter from the time I drove up Linden Lane to Beaven Hall in September 1963. In my opinion (and as another commenter on this thread has already noted in part), Regis's tuition free policy and its absolutely amazing success in getting graduates into first class colleges/universities are a function of three elements: (1) continuing to attract academically very highly qualified students; (2) maintaining a talented faculty (almost entirely non-Jesuit these days) able to bring out the best in those students; and (3) very substantial financial support (and I say "very substantial" advisedly) from alumni like myself and other supporters of the school. Regis has always been and will continue to be an outstanding high school, public or private. What makes it particularly special in a non-public school context is its "no tuition" policy. I don't know how long that can last, but I know that Regis alumni will continue to do our part to keep it going. A unique model, but one that is specific to Regis's history and circumstances and not otherwise duplicable these days, unfortunately. |
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Post by DFW HOYA on Sept 21, 2020 21:14:53 GMT -5
What makes it particularly special in a non-public school context is its "no tuition" policy. I don't know how long that can last, but I know that Regis alumni will continue to do our part to keep it going. A unique model, but one that is specific to Regis's history and circumstances and not otherwise duplicable these days, unfortunately. It is certainly unique in Catholic education. Some private schools have tried a similar model but eventually stumbled--Cooper Union comes to mind, while Rice University was tuition-free until 1966. For public schools, Purdue University has held the line on in-state tuition at $9,992 a year. The problem is that any serious cost-containment program requires a sense of institutional discipline which colleges are notoriously weak to maintain. It's too easy to add a faculty member here, a department there...and the cost eventually drives tuition. |
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Post by alum on Sept 22, 2020 9:38:58 GMT -5
Public colleges were never designed to be for all and by all. My late father was one of three brothers who attended B.M.C. Durfee HS in Fall River (a city that's been in a downturn for the last 110 years or so). None of the three went to college. If you didn't join the military after high school (all three did) you got a job at a factory or whatever mills were still open. College was something you did if you wanted to be a doctor or lawyer, but that was it. Fall River had its share that made it to Holy Cross and maybe a few more to Providence, but college wasn't required for a career and it only put off a marriage and family for four more years. State colleges were either for agriculture (UMass-Amherst) or teachers colleges. Very few women went to college and if someone was black, even fewer. Today, the expectation is that every high school grad, men and women, are supposed to go to four year colleges, or as it has been called, "extended high school". Others will go on to grad school, even if a career doesn't require it. The cost of maintaining colleges has outstripped the ability to pay. HC and schools like it are approaching a $100,000 price tag this decade. And the only way this changes is one of three disruptive changes: 1. Private colleges go to a Regis High School model of free tuition, with sharply lower costs for faculty and staff;2. State governments heavily subsidize free public education via higher taxes; or 3. Employers no longer demand college as a prerequisite for a first job and accept certificate courses as a substitute, bringing the demand for the state systems way down. I'm a Regis ('63) and HC ('67) grad (as is my brother Tom: Regis ('68); HC ('72)). For what it's worth, I've been an ardent HC supporter from the time I drove up Linden Lane to Beaven Hall in September 1963. In my opinion (and as another commenter on this thread has already noted in part), Regis's tuition free policy and its absolutely amazing success in getting graduates into first class colleges/universities are a function of three elements: (1) continuing to attract academically very highly qualified students; (2) maintaining a talented faculty (almost entirely non-Jesuit these days) able to bring out the best in those students; and (3) very substantial financial support (and I say "very substantial" advisedly) from alumni like myself and other supporters of the school. Regis has always been and will continue to be an outstanding high school, public or private. What makes it particularly special in a non-public school context is its "no tuition" policy. I don't know how long that can last, but I know that Regis alumni will continue to do our part to keep it going. A unique model, but one that is specific to Regis's history and circumstances and not otherwise duplicable these days, unfortunately. An explanation of the success at Regis can be found on its website. It costs $14.6 million to operate the place. They generate $9 million from an annual fund, $3.5 million from the close to $100 million dollar endowment, $660,000 from grateful parents, and some program revenue to cover the rest. Raising $9 million a year for a high school is pretty amazing. www.regis.org/section/?ID=228Enrollment: 533 boys, grades 9-12 Faculty: 4 Jesuits, 1 Oratorian, 58 lay men and women Teacher-student ratio: 1:10 Average teacher experience: 18 years |
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