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Some people think the price of going to college has gone up because so much money has been made available to students through financial aid. I don’t know if tha

Some people think the price of going to college has gone up because so much money has been made available to students through financial aid. I don’t know if that’s been proven but it sounds plausible.

alistairSH 6y ago
I'm actually in the higher education world (on the periphery, as a software developer). It's more complicated than that. Over the same time period that loans have become easily obtainable (via US government backing), massive amounts of regulation has also been imposed on colleges/universities. While people love to talk about football stadiums, luxury dorms, and other amenities, one of the largest increases in the cost of running a college is administrators to keep up with regulatory demands. I'm not claiming administrators are solely responsible, only that it's not as simple as "Uncle Sam gives students money and college spend every penny". Additionally, public funding of colleges has dropped over the same time period. As of 2018, state funding of public colleges was down ~$7 billion since 2008. It was slashed during the down economy, but never brought back up again.
- seanlinehan 6y ago
  To add a small bit of context for the last point about funding. A $7B reduction in funding sounds like a lot, but during that same period student loan debt increased by $760B.[0] On the balance, the reduction in state funding seems like an insignificant piece of the puzzle. [0] https://www.experian.com/blogs/ask-experian/state-of-student-loan-debt/ https://www.experian.com/blogs/ask-experian/state-of-student...
- DangitBobby 6y ago
  In what ways have regulations increased costs?
  - malandrew 6y ago
    A good example is the parallel legal and law enforcement systems on college campuses. In the past, you'd call the regular police and you'd take issues to the courts used by all other citizens outside the university. Now universities maintain their own law enforcement and farcical "justice" system. This stuff is not cheap to operate and comes with tons of overhead.
  - HankB99 6y ago
    They stated "...administrators to keep up with regulatory demands." I wonder, however, if administrations just take on a life of their own and grow bounded only by available budget. It seems like this happens in the private sectors with layer upon layer of management.
    - Firehawke 6y ago
      That's certainly been my experience; management and bureaucracy will expand to fill any available budget unless constrained. Since management almost always runs the show, there's almost never constraint.
  - alistairSH 6y ago
    Hiring bodies to perform the administrative work required by law. Lots of compliance - title 9, etc at the federal level, plus more at the state level. We have several teams of developers pushing out state-level regulatory updates to our software (and these updates are frequent and often done on short notice), plus more teams doing annual federal regulatory updates. And again, I'm not claiming this is the largest contributor, only that it's one of many reasons (easy access to loans included as well).
- wtvanhest 6y ago
  There is a myth that administrators drive up the cost of colleges. The truth is that overall university headcount, including administrators, professors, etc. have all increased, and the costs along with that headcount has as well. The rapidly increasing headcount growth, including professor headcount growth is driving the increased cost which is driving increased borrowing. Universities need much bigger class sizes, many fewer professors, and many fewer administrators. Overall headcount at universities needs to shrink by ~70% to get the cost back inline. No politician, or university president is going to say that because it would be so brutal to oversee. But... students are suffering with massive debt loads and someone is going to have to make the right choices to cut those costs.
  - bart_spoon 6y ago
    They've all increased, but the rate at which administration positions has increased dwarfs that of professors and students. According to the figures in the article cited here, administration positions grew at 3.5x the rate that professors have, and 2x the rate that students between 1975 and 2005 [0]. [0] https://washingtonmonthly.com/magazine/septoct-2011/administrators-ate-my-tuition/ https://washingtonmonthly.com/magazine/septoct-2011/administ...
ishjoh 6y ago
The New York Fed did a study on exactly this question. They found that there was a correlation: https://www.newyorkfed.org/medialibrary/media/research/staff_reports/sr733.pdf https://www.newyorkfed.org/medialibrary/media/research/staff... "We find a pass-through effect on tuition of changes in subsidized loan maximums of about 60 cents on the dollar, and smaller but positive effects for unsubsidized federal loans. The subsidized loan effect is most pronounced for more expensive degrees, those offered by private institutions, and for two-year or vocational programs."

alistairSH 6y ago

I'm actually in the higher education world (on the periphery, as a software developer). It's more complicated than that. Over the same time period that loans have become easily obtainable (via US government backing), massive amounts of regulation has also been imposed on colleges/universities. While people love to talk about football stadiums, luxury dorms, and other amenities, one of the largest increases in the cost of running a college is administrators to keep up with regulatory demands. I'm not claiming administrators are solely responsible, only that it's not as simple as "Uncle Sam gives students money and college spend every penny". Additionally, public funding of colleges has dropped over the same time period. As of 2018, state funding of public colleges was down ~$7 billion since 2008. It was slashed during the down economy, but never brought back up again.

seanlinehan 6y ago
To add a small bit of context for the last point about funding. A $7B reduction in funding sounds like a lot, but during that same period student loan debt increased by $760B.[0] On the balance, the reduction in state funding seems like an insignificant piece of the puzzle. [0] https://www.experian.com/blogs/ask-experian/state-of-student-loan-debt/ https://www.experian.com/blogs/ask-experian/state-of-student...
DangitBobby 6y ago
In what ways have regulations increased costs?
- malandrew 6y ago
  A good example is the parallel legal and law enforcement systems on college campuses. In the past, you'd call the regular police and you'd take issues to the courts used by all other citizens outside the university. Now universities maintain their own law enforcement and farcical "justice" system. This stuff is not cheap to operate and comes with tons of overhead.
- HankB99 6y ago
  They stated "...administrators to keep up with regulatory demands." I wonder, however, if administrations just take on a life of their own and grow bounded only by available budget. It seems like this happens in the private sectors with layer upon layer of management.
  - Firehawke 6y ago
    That's certainly been my experience; management and bureaucracy will expand to fill any available budget unless constrained. Since management almost always runs the show, there's almost never constraint.
- alistairSH 6y ago
  Hiring bodies to perform the administrative work required by law. Lots of compliance - title 9, etc at the federal level, plus more at the state level. We have several teams of developers pushing out state-level regulatory updates to our software (and these updates are frequent and often done on short notice), plus more teams doing annual federal regulatory updates. And again, I'm not claiming this is the largest contributor, only that it's one of many reasons (easy access to loans included as well).
wtvanhest 6y ago
There is a myth that administrators drive up the cost of colleges. The truth is that overall university headcount, including administrators, professors, etc. have all increased, and the costs along with that headcount has as well. The rapidly increasing headcount growth, including professor headcount growth is driving the increased cost which is driving increased borrowing. Universities need much bigger class sizes, many fewer professors, and many fewer administrators. Overall headcount at universities needs to shrink by ~70% to get the cost back inline. No politician, or university president is going to say that because it would be so brutal to oversee. But... students are suffering with massive debt loads and someone is going to have to make the right choices to cut those costs.
- bart_spoon 6y ago
  They've all increased, but the rate at which administration positions has increased dwarfs that of professors and students. According to the figures in the article cited here, administration positions grew at 3.5x the rate that professors have, and 2x the rate that students between 1975 and 2005 [0]. [0] https://washingtonmonthly.com/magazine/septoct-2011/administrators-ate-my-tuition/ https://washingtonmonthly.com/magazine/septoct-2011/administ...

ishjoh 6y ago

The New York Fed did a study on exactly this question. They found that there was a correlation: https://www.newyorkfed.org/medialibrary/media/research/staff_reports/sr733.pdf https://www.newyorkfed.org/medialibrary/media/research/staff... "We find a pass-through effect on tuition of changes in subsidized loan maximums of about 60 cents on the dollar, and smaller but positive effects for unsubsidized federal loans. The subsidized loan effect is most pronounced for more expensive degrees, those offered by private institutions, and for two-year or vocational programs."