Jeff Jacoby writes The College Money Pit for the Boston Globe, 4/29/12.
Year in, year out, Washington bestows tuition aid on students and their families. Year in, year out, the cost of tuition surges, galloping well ahead of inflation. And year in, year out, politicians vie to outdo each other in promising still more public subsidies that will keep higher education within reach of all. Does it never occur to them that there might be a cause-and-effect relationship between the skyrocketing aid and the skyrocketing price of a college education? That all those grants and loans and tax credits aren’t containing the fire, but fanning it?
“It’s not enough just to increase student aid. We’ve also got to stop subsidizing skyrocketing tuition,” Obama said to applause in Iowa City. He might as well have declared that it’s not enough to keep flooring the accelerator; we’ve also got to stop the car from going faster. Reality doesn’t work that way. Rising government aid underwrites rising demand for higher education, and when demand is forced up, prices follow suit. (See under: Crisis, subprime mortgage.)
Jacoby sees the pattern that most seem to ignore.
Government subsidies for health care have driven up the prices of health care for everyone (and driven down service and choice).
Government subsidies for housing created the housing boom and its subsequent bust. What made government interference so much more dastardly in housing was the addition factor of leverage, a very deadly double edged sword. Do we expect government subsidies for college to have any different effect?
Why do we ignore the basic economics of the issue? Again.
The idea that everyone needs a college degree is as misguided as the belief that everyone needs to own a home. By pushing students into college who may not be suited for a higher education we sacrifice the quality of our schools and we do not serve the best interest of the students who may benefit from other educational opportunities. The gap between the matriculation rate and the graduation rate widens.
Just as everybody does not need to OWN a home there are a lot of solid career paths that do not truly need a four year undergraduate degree. By inserting themselves into the educational structure the government has helped create unwieldy institutions that may adapt poorly to the technical educational improvements that should help to lower educational costs.
The growth in education infrastructures may be headed for another shakeup. Online colleges and other learning avenues offer education without the bloated cost. Check out Khan Academy as an example of where we may be headed.