Jane just got accepted to a prestigious private university. Tuition is over $40,000 a year and her parents do not qualify for financial aid because of their high incomes. They write out a check for $160,000 and Jane is on her way to earning a four-year degree.
John also received an acceptance letter to the same school. In his case, his parents are not so well off so he qualifies for both federal and state financial aid. Because of his high GPA he receives college scholarships as well. Still unable to afford college, he is offered and accepts several loans because he believes that going to a more expensive college means that his degree will be worth more and will eventually get him a high paying job. Eventually, he figures, he will be able to pay off those loans.
Most students at college tend to fall somewhere between those two cases. After wading through the bog of muddled information from college admissions offices about financial aid, parents are relieved to have even made it through the process alive, figuratively speaking. Little time or energy is then left to investigate questions like “What does my tuition money actually fund?”
College campuses are set up like miniature governments. The endless red tape and long lines. The faculty senate. The handbook, codes, rules. The unnecessary bureaucracy. Offices of disabilities and abilities alike. Signature collection, approvals, stamps, mailboxes, and forms. Even at private universities, you can expect to run into your fair share of government documents to fill out regarding employment, finances and running your affairs.
Colleges are very heavily subsidized by the government — through the current stimulus package, especially through aid and loans for students as also through a variety of other means. In turn, colleges know that they can raise tuition prices through the roof and get away with it. Government, which is to say the taxpayers extorted by the government, will always be there to provide the money. Right? This allows colleges to continually add more employees and limitless layers of bureaucracy, simply because they can afford it. An illusion is created that the college is progressive, growing and innovative. In reality, they’re simply unnecessarily wasting resources.
A truly free market would lack the subsidies that distort the current education market. In a stateless society, to be specific, market discipline would create the expectation that “what you pay for is what you get.” Admissions offices would boast of their efficiency; recruiting new students by pointing to comparisons of the costs versus benefits of attending their school — because that information would be easier to meaningfully identify without market distortions. Instead of cost alone, students and parents would be looking at the actual educational value to be received for their money. Colleges wouldn’t be pressured to give tenure to a horrible professor simply because of how long he had taught at the school. Rather, they would reward instructors based on merit as determined by consumer choices in the market.
From the perspective of the average person, meaningful financial transparency on college campuses is currently rare. With students lost in loan rules la-la land, chasing elusive job openings, and facing overall exhaustion with the current system, it can be arduous to investigate where the money students pay is going. With the current state of the economy, however, students and parents will have to wake up and ask these important questions of transparency, choosing the most cost effective and truly productive school. Such challenges to authoritarian institutions of all sorts will increasingly become crucial to the financial survival of the ordinary person.
How does one quantify educational value?
I believe educational value can be quantified, but only in a subjective manner. For example, students would rate their past semester’s classes on a scale of 1-100, as well as numerous other aspects of campus life. They could then attach reasons as to why they chose such scores. Scores with ridiculous reasons that are not supported (great teacher with a failing grade, for example, or LOL THAT TEACHER WAS SO HAWT) would be thrown out. This would enable people to see colleges based on how the students that attend perceive the college, and quantify the value of the education (as well as other aspects of the college, such as food) based on the average of all students, and, potentially, based on other things such as race, income, etc. to see how people of their general socioeconomic “class” or lifestyle view the college.
Tying this is monetary value could be interesting, though. Perhaps students could also input how much they would be willing to pay for each class and meal, etc. (when given knowledge such as the cost of meals per day and teacher salary and other things to understand why it doesn’t cost $15 per year) and prices could be set and adjusted based on that.
An enormous amount of what college administrations do actually interferes with education rather than facilitating it — meaning that a lot of administrative expenses are a deadweight loss. A more attractive model is the old University of Bologna, run by students and professors together with no administrative third-wheel:
http://libertariannation.org/a/f13l3.html
In an Anarchist society, centers of learning would be sponsored collaboratively by communities for their members and guests. There would be little (if any) distinction between students and teachers; some people might know more about certain topics, that's all. There would be no bureaucracy or administration whatsoever. Admissions would be by invitation. It would not be so much a 'campus' as a 'district'. Grades and diplomas are anachronisms today and unthinkable in the Anarchist university. If you leave as a better person and had a good time, then it was a success. Of course, this also requires the reworking of the rest of society, as the current purpose of the university system is to get more qualified for higher-paying jobs, which makes no sense in an Anarchist gift-economy.
Great article, Stacy. I’ve often used the comparison of govt subsidizing high education with govt subsidizing of health care to explain the high costs.