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Saturday, October 20, 2012

During a middle school soccer game on a beautiful fall day a friend, neighbor and fellow soccer dad asked me why college tuition was rising so fast. My response was lackluster and sparked a reply. Dear Friend, You had to go an ask me about rising tuition costs and I was surprised at how much my answer was lacking. So, taking advantage of awake time while others are asleep I did a little digging. Here is what I found out. Thanks for making me think about this as my answer is now more complete. Thomas Summary: If education where strictly a business then all is well. Supply and demand dictates the elasticity of demand to support raising rates at current levels. Competition for customers dictates enhanced services and facilities in order to attract the most customers in a particular companies (institution of higher ed) niche. Lobbies at government levels create policy in support of the business (loans, tax breaks and so forth). A very typical scenario for the majority of industries in our economic and political system. This raises the question; is education strictly a business or do we want it to be a public service? Some answers as to why college tuition up over inflation. 1) Availability of government backed loans (1992) coupled with the trend of the 1980s to operate all organizations as a "business". 2) Increased numbers of administration 3) Building projects offering services such as sports, recreation facilities, living facilities and so forth 4) Supply & Demand (economics) there are a lot more students attending and the same number of colleges. 5) Cuts in state contributions (at MU from about 60% 1986 to about 27% 2012) Now here is a story that has a more complete answer. (You can download this and listen) “among them excessive spending by colleges and universities, which drives up tuition, and declining government support for public universities as state and local governments face budget crises.” "[Colleges and universities] compete with one another not to make money, but for status and prestige, so they buy things that increase their status and prestige in relation to their competitors," Carey tells Fresh Air's Dave Davies. "They're big on construction. ... They're always building things." “It turns out professors aren't really doing all that well. They're not the beneficiaries of the large increase in college spending that has gone on.” What's Driving College Costs Up? Due to availability of government backed loans Inflation Data Article on Rising Costs Loan availability plus - “universities have in recent years vastly expanded their administrative bureaucracies, while in some cases actually shrinking the numbers of professors.” (with bias I must correct the statement on tenure in this article. At my university, and MU is typical, one has tenure and there is a contractual agreement to “produce” at specified rates. At MU that is 8 courses per year at an average of 40 students per class. Additionally one is held responsible for a complex set of quality control measurements. Failure to complete these expectations will not protect ones employment. Tenure does not guarantee a position, only the opportunity to preform in the position.) Forbes gives a more complete analysis Millersville Costs: http://www.millersville.edu/bursar/costs.php In-State tuition, fees, room & board = $17,500.00 In-State tuition & fees only = $8,600.00. Tuition up in ten years about 4.53% Reduction in state contribution in ten years down about 4%

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