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Pretty Good Piece on the Cost of Public College

By JLP | December 18, 2012

I read this essay in last weekend’s WSJ about the skyrocketing cost of going to public college.

It opened with…

When Steve Joiner attended the University of Colorado in Boulder in the late 1980s, his parents—an Air Force mechanical supervisor and a teacher—paid his tab of about $4,000 a year, roughly $8,600 in today’s dollars. He earned a master’s degree and became a high-school math teacher.

In August, Mr. Joiner’s daughter Akaysha, the valedictorian of her high-school class, enrolled at CU, as the big campus here is known. But tuition, room, board and books for in-state students is now $23,000 a year—a sum Mr. Joiner and his wife, a social worker, weren’t prepared for.

The big difference between now and then: Though Colorado taxpayers now provide more funding in absolute terms, those funds cover a much smaller share of CU’s total spending, which has grown enormously. In 1985, when Mr. Joiner was a freshman, state appropriations paid 37% of the Boulder campus’s $115 million “general fund” budget. In the current academic year, the state is picking up 9% of a budget that has grown to $600 million.

He then goes on to list a few factors that have led to these price increases:

• administrative costs have soared over the years

and

• public (taxpayer) funding has decreased

I wish the author would have gone into more detail regarding administrative costs. I have always thought that administrative costs have gone up simply because they are expected to go up (self-fulling prophecy). In other words, if we didn’t just expect prices to go up, colleges might be under pressure to control costs.

What’s interesting about the public funding portion is that the author found that money to be diverted to other areas like primary education and Medicaid. Simply put, there isn’t enough money to do everything. This is unfortunate because college costs are increasing so much that they are keeping some people from reaching their potential and becoming productive citizens. Let’s not forget the fact that more social spending also enslaves the general public by making them more dependent on the government than on themselves.

Take a look at this Medicaid past, current, and future spending chart I found in an actuarial report on Medicaid spending (click on the chart to go to the PDF report):

Medicaid Spending

This does not bode well for controlling the future cost of public college. It also does not bode well for a healthy middle class.

Topics: College Funding, Economics | 4 Comments »


4 Responses to “Pretty Good Piece on the Cost of Public College”

  1. Squeezer @Personal Finance Success Says:
    December 18th, 2012 at 1:30 pm

    And look at what is happening at universities. They are building mega brick structures, or bulldozing buildings and court yards to………..build more mega brick structures. But, they will never build what colleges need. Parking and easy access.

  2. JLP Says:
    December 19th, 2012 at 7:16 am

    Agreed. My wife and I went to Lamar University back in the mid-90s. That campus has changed drastically since we graduated.

  3. BG Says:
    December 19th, 2012 at 9:47 am

    I would like to know what percentage of in state undergraduate students are actually paying that $23k sticker at CU.

    I’d be surprised if it were even 10%.

  4. Jack Says:
    December 22nd, 2012 at 4:32 pm

    That’s partly the point, BG. Government “help” has driven the sticker price up to the point that almost everyone needs the help.

    Any time you make more money available for a product, the cost goes up.

Comments