Saturday, March 06, 2010

Higher Education Woes

Angry US Student Protest Cuts to Higher Education

BERKELEY, Calif. (AP) - Anger over increasing tuition and school budget cuts boiled over as students across the country staged rowdy demonstrations that led to clashes with police and the rush-hour shutdown of a major freeway in California.

Students, teachers, parents and school employees rallied and marched Thursday at college campuses, public parks and government buildings in many U.S. cities in what was called the March 4 Day of Action to Defend Public Education.

In California, protesters evaded police and walked onto Interstate 880 near downtown Oakland just before 5 p.m., forcing the closure of the freeway in both directions for more than an hour and causing traffic to back up for miles.

Police arrested more than 150 people, said Officer Sam Morgan, a spokesman for the California Highway Patrol.

One protester suffered serious injuries after jumping from the elevated freeway while officers were making arrests.

Elsewhere, University of Wisconsin-Milwaukee police arrested at least 15 people protesting tuition hikes after demonstrators tried to enter an administrative building to deliver petitions to the chancellor.

Read the whole article.

Tuition costs continue to rise for students, due largely to government intervention with loans, grants, etc. I know of one college in our region that is raising tuition costs by 5.9%. Long gone are the days when students could earn enough during summer months to cover room & board, tuitions, books, etc. for an academic year, as when I was a college student.


THE said...

Dr. C-
Could you please explain how government intervention in loans and grants has led to massive tuition increases? I don't follow how that works.

abcaneday said...

Yes, I am pleased to explain how government intervention in loans and grants to students has led to massive tuition increases ever since government intruded into funding education by way of loans and grants to students.

Actually Economics 101 provides the explanation. If we flood the market with cheap-and-easy-to-borrow-money for college tuition costs and make available easy-to-secure-free-money in the form of grants, basic economic theory confirms that college education will be made "affordable" to ever increasing numbers of potential students. Thus, demand for higher education by increasing numbers of young people who would not otherwise have pursued college education, partly if not in large part because they could not have afforded it, inevitably and invariably has an unintended effect upon college & university administrators who recognize the vast financial resources of cheap and easy money (loans & grants) made available to potential students and increase fees, room & board, and tuition costs.

Anyone who will do the research will discover that ever since government began its guaranteed loans and grants programs for higher education college & university tuition costs have exponentially increased compared to other goods and services in the marketplace. Because of government interference with guaranteed loans and grants, college tuition increases parallel increases in medical care costs, where government also intruded with medicare & medicaid programs.

As I indicated above, the issue is explained by basic economics.

Because of Blogger's space restrictions I will post a second note below that continues my response.

abcaneday said...

For further reading, consider the following.

Unfortunately, Expanding Pell Grants Likely to Increase College Tuition and Fraud, by Julie Borowski on Feb 02, 2010

College Tuition Inflaters, by Neal McCluskey

College loans could contribute to tuition hikes, by Jeremy Davis

This article observes,

"So the more tuition goes up, the more loans students take out, which in turn will contribute to future increases, keeping the cycle going.

"Peter Schiff, a free market economist and president of Euro Pacific Capital, said colleges and universities can continue to raise tuition fees to new heights simply because they know that students, through federal student loans, will pay them.

“'See the problem with government guaranteed students loans is the universities get all the money, the students get stuck with the bill,' Schiff said in a recent video address on his campaign for U.S. Senate Web site. 'Anybody who wants to go to school has access to the U.S. government cosigning their loan, so what happens is all the students bid against each other, they compete for slots in universities with government money and so they bid the prices up. There’s no restraint.'”

Making College More Expensive The Unintended Consequences of Federal Tuition Aid, by Gary Wolfram

Here are a few lines from the summary of Wolfram's article.

"One result of the federal government's student financial aid programs is higher tuition costs at our nation's colleges and universities. Basic economic theory suggests that the increased demand for higher education generated by HEA will have the effect of increasing tuitions. The empirical evidence is consistent with that--federal loans, Pell grants, and other assistance programs result in higher tuition for students at our nation's colleges and universities."

I trust that this will help explain the vicious cycle that forever escalates tuition costs, making it increasingly more difficult for students to afford education.