TUP (Trickle Up Poverty) is full of gems. One is on pages 245 and 246, in chapter 9, “School Daze: Eliminating the Propaganda Ministry”. Savage paints a dramatic comparison of today’s education costs to what they were in 1965, the year the Higher Education Act began, supposedly to “make college more affordable”. Citing multiple sources for his information, he compares the 1965 annual tuition at the University of Pennsylvania of $1,530 per year plus $1000 for room and board to the current annual tuition of $38,970 and $7,748 (the average cost of room and board at an American university during the 2009-2010 school year). That’s almost a 20-fold increase or 2,000%, which can’t merely be ascribed to inflation.
These statistics hit home with me because in 1965 I was attending San Diego State College (It wasn’t a university yet.). In those days, I was able to pay my own college expenses. California State College tuition was much more affordable than the University of Pennsylvania. I was able to save enough money from summer jobs to pay for tuition and books and pay for room and board with part-time employment in the college’s food service department. Many of the students I knew were able to do the same. Sadly, that’s impossible now.
Savage points out that the dramatic cost increases are the result of government’s involvement in guaranteeing loans. He explains, “Because federal guarantees essentially cut out market forces as determinants for the cost of a college education, something akin to what has happened to healthcare costs has occurred. For, as in the healthcare industry, when you’re not directly spending your money for a service, and when what you owe is guaranteed even if you default, nobody pays nearly as much attention to how much things cost as they do when they are personally the guarantors of payment.” And in addition to cost increases, Savage adds, “And with the federal takeover of the student loan business, conditions are now ripe for government even more closely controlling the content of educational material and the conditions under which American students will be allowed to go to college.”
[UPDATE] If your hatred for Michael Savage leads you to disregard anything he says, then consider what Richard Vedder has said. (Mr. Vedder is the Edwin and Ruth Kennedy Distinguished Professor of Economics at Ohio University who has authored several books and written for major print media.) In a list of “eight problems with federal student grant and loan programs”, Mr. Vedder writes,
(3) Perhaps most importantly, federal student grant and loan programs have contributed to the tuition price explosion. When third parties pay a large part of the bill, at least temporarily, the customer’s demand for the service rises and he is not as sensitive to price as he would be if he were paying himself. Colleges and universities take advantage of that and raise their prices to capture the funds that ostensibly are designed to help students. This is what happened previously in health care, and is what is currently happening in higher education. http://www.hillsdale.edu/news/imprimis/archive/issue.asp?year=2012&month=05
Yes, things have changed since my college days. And as the above example demonstrates, not all change is good. Young people, who weren’t around to see how good our educational system was 45 years ago, need to understand that socialism doesn’t help lift up society’s standard of living. It only brings us all down. If you haven’t learned that yet, you are asleep and dreaming.