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Dear Liz: Thank you for your response to the reader who complained that college students who received student loans were getting a handout. You did a great job of highlighting the challenges today’s students face, but you didn’t talk about the main underlying cause. This is the defunding of state universities by state governments. In Oregon, for example, the state has gone from funding over 50% of the costs to current funding of 6%. The difference has been made up by tuition hikes and increasing the proportion of out-of-state (and foreign) students who pay much higher tuition. This is part of the reason that students are crowded out of classes. In Oregon, the medical school found it was better off giving up all state aid and going it alone. Other universities in Oregon are considering taking the same action. Schools founded with state money and supported for years with tax money will no longer be operated for Oregon students. They will be more like private schools, perhaps moving out of the reach of middle-class students. So the answer to the reader is that she did get government help to get through school, help that is now curtailed so students have to finance it themselves.

Answer: The reader didn’t specify what type of college she attended. But the withdrawal of state government funding in recent years has definitely made public college educations more expensive for many students. Meanwhile, many private schools have expanded their financial and merit aid budgets so that some students can attend a private college at a lower net cost than what they would pay for a public school.

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Categories : College, College Savings, Q&A

2 Comments

1

There is yet another cause for the elevated cost of college. This cause consists of several elements.

First, the idea became current that everyone needed a four-year degree.

Second, the Federal government started providing funds to achieve this goal–such things as student loans, grants, etc. All with very generous income family qualifications.

Finally, colleges saw all this “free” money there for the taking and–they took it. Costs started going up.

Funding inflation joined by grade inflation. The result was more and more people with less and less valuable degrees.

2

College degrees aren’t exactly a fad. The job market has changed dramatically, with many of the positions that used to provide good incomes for high school grads disappearing or going overseas. At the same time, more employers started using college degrees as a screening device for entry-level jobs that didn’t used to require them. As a result, some kind of post-secondary education has become all but essential if you want to remain in the middle class in the 21st century, but there are ways to get that education without drowning yourself in debt.