Relevant and even prescient commentary on news, politics and the economy.

Higher education tuition increases fueled by?

Salon points us to a primary reason public higher education tuition inflation has occurred that is left out of election rhetoric, more so than the suggested availability of Pell grants. And of course the selling of the need for one by us all.

The problem: The word “public” doesn’t mean as much as it used to. Direct state support for public colleges has cratered over the past 10 years, and really fell off the cliff after the financial crisis. Yes, tuitions have risen, but not by as much as state and local appropriations for higher education have fallen. Just between 2008 and 2009, for example, average tuition revenue at public research institutions increased by $369 per student, but the loss in state and local appropriations per student was $751. Similarly, at public community colleges, tuition revenue rose by $113 per student, while appropriations fell by $488. Since the recession of 2001, tuition hikes, as exorbitant as they have been, still haven’t kept pace with the fall in government support.

The bottom line: For the large majority of college students, rising tuitions have nothing to do with the availability of student loans or Pell Grants. What’s happening, instead, is that the burden of paying for college that was previously provided directly by government has now been shifted onto the backs of students…

Tags: , Comments (19) | |

It Takes a Village: Scarcity, the NCAAs, and the Decline of U.S. Manufacturing

I don’t remember seeing any of this type of story last year. But this year, Socialism stories abound from the Midwest.

My ex-roommate* sends this link to a story about Butler Bulldogs’s Senior Matt Howard’s family being able to attend the NCAA Finals tonight in Houston (video link here).

Luke Winn of Sports Illustrated covered the macro territory. The 12.7% unemployment rate, up from a few years ago and still 2nd-highest in the state of the 92 counties. The population of “about 13,000,” which puts the decline since I graduated high school at worse-than-Detroit levels—but that makes sense since most of the factory work over the previous forty years was Ford-related as the town once referred to as “Little Detroit” lost competitors to larger areas and consolidation.

Winn’s article, not to mention several other recent pieces about Howard’s childhood make it clear that it really does take a village. From the NYT piece:

His mother, Linda, who credited her faith for helping her raise 10 children, said strangers would stop and ask, “Are you the lady with all the kids?” before dropping off bags of clothes. “Maybe everything didn’t fit,” she said. “But we didn’t complain.”

Bryan Caplan’s noted in his presentation at Kauffman that he knows no one who is liquidity-constrained in their ability to raise children; rather, it’s time allocation that stops them. I suspect he needs to get out more.

And now the city with 12.7% unemployment and a dim future has once again reached into its collective pockets to make certain that Matt Howard’s family gets to see their son’s/brother’s final college game, which also happens to be for the NCAA Championship.

From each according to his ability, to each according to his needs.

As I said, I didn’t see stories like this last year. Last year, there was still another year for Howard and the Bulldogs. Now, there is no possible future NCAA Championship; this is the last time this can ever happen. An economist would tell you that people recognized the Scarcity Value and dug into their pockets accordingly.

So not only did it take a Village to help as best they could to raise the ten Howard children, it took a Village to enable the family to go to Houston to see now-senior Matt Howard and the rest of the Butler Bulldogs play—win or lose; I hope win—for the NCAA Championship.

Ex ante, it’s a great decision. Ex post, it will still have been one.

Musical accompaniment: Tom T. Hall, of course.

*For whom Mike Mandel took a picture of Tyler and Natasha Cowen at last week’s Kauffman Economic Bloggers Forum, since he and Tyler were once ranked (by Tyler) as the #1 and #2 chess players in the area. Sadly, neither went into the sport as a full-time professional.

Tags: , , , , , Comments (5) | |

Higher Ed Watch

Higher Ed Watch covers the student loan scandal (links and the rest of the article):

One way or another, a whistleblower lawsuit filed by Jon Oberg, the U.S. Department of Education researcher who uncovered the 9.5 student loan scandal, against six student loan companies that participated in the scheme should come to a conclusion shortly.
The parties are currently in the third-day of court-ordered settlement talks to resolve the lawsuit, which seeks the return of approximately $1 billion to the government in overpayments these lenders improperly received. If the negotiations break down, the case is scheduled to go to a jury trial in the U.S. District Court for the Eastern District of Virginia on Tuesday. As we have said, this case should finally resolve many of the unanswered questions surrounding the scandal. After doing a careful review of the court documents publicly available on PACER (Public Access to Court Electronic Records), here are some of the truths that we believe have been revealed…

Tags: Comments (3) | |