College Cost Limits

July 26, 2019

Like other things college cost are driven by supply and demand, but government subsidies have created artificially high rates of inflation. How could we get college cost under control.  It can be beneficial for the government to help some people pay for college, but how much and who should be up for debate.  The allowing colleges to continually raise tuition using government money and student debt to subsidize their endowments may not be the best use of resources.  The benefits must be weighed against what is best for the nation and the people.  The question should not be all or nothing without exploring other alternatives.





Base Issues:

  • College education prices are continually rising disproportional to other services from 1980-2010 increasing three time more than the average household income.

  • College education is not necessary for the jobs many if not most graduates fill.

  • As the government increases student financial aid schools increase costs proportionally to balance supply and demand.


Two opposing fixes:

  1. Decrease artificial access to public funding.Suggestion restrict funds to economic necessities: The government should only subsidize education if there is a need for the skill and only proportional to meet the necessary need plus a reasonable margin of error.

  2. Tuition caps.Government could restrict the total tuition of a degree to the average amount that that schools graduates make during their first year after graduation, plus an additional 50% for room, board, and books (and this for public schools, and private schools that want access to government financial aid programs).  Students that fail to get employment would count as a $0 in the average, while student not wanting employment would not be counted (grad students).

    • This is a concept based on historic norms and a rate that should allow students a reasonable opportunity to pay down student loans.(At this rate it should take 10-15 years to pay off student loans using 15% of their net income at an interest rate of 5%-7%)

    • This encourages colleges to 1) focus on skills that employers want, 2) have a robust job placement program, 3) encourage colleges to find the best employers and just any employers,4) promote internships that are beneficial to the students.

    • Example 1: English majors form XXU average $40,000 in their first year after graduating from XXU = XXU would be limited to charging $10,000 / year for tuition and$5,000 for room, board, and books.

    • Example 2: XXU has an engineering degree and the XXU graduates average $100,000 there first year could charge $25,000 plus.




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