College education is getting out of reach

Posted by Shyam Moondra

Aside from the ever increasing health care cost, the only other cost which is not showing any sign of slowing down is the cost of college education. The high cost of college education is affecting the finances of an increasing number of middle-class families that are not rich enough to be able to afford it nor poor enough to qualify for financial assistance.

The following trends show that the U.S. higher education system is out of whack:

1. The tuition and other fees are being increased, year after year, far beyond the general inflation rate, rendering college education out of reach for many students and their families.


2. The compensation of the Presidents of educational institutions have increased drastically, in line with the excessive compensation of the executives at the corporations.


3. More and more universities and colleges are spending more and more money on sports activities. Building new stadiums and showering athletic departments with lavish budgets have become fashionable these days. Now the success of schools is judged not based on academic accomplishments but based on the game scores.


4. The endowments of many schools have grown so big as to match the annual budgets of many countries running into billions of dollars, and yet these schools are spending proportionately less and less on education.

Up to this point, the government has introduced tax credits and provided more funding for student loans to help many families pay for college education, but that's just the wrong approach. Rather than finding ways to pay for inflated tuition fees, the government needs to find ways to roll back the artificially inflated tuition by at least 30%. The incoming Obama administration and the Congress need to pass a higher education reform legislation that will have the following elements:

1. Limit the compensation of the administrators of the universities and colleges.


2. Craft the tax laws in such a way that they penalize the schools that increase the tuition fees in excess of the general inflation rate.


3. Impose hefty taxes on rich school endowments that do not spend a specified minimum portion of their incomes on helping needy students with financial assistance. Those schools that fail to spend the required amount must surrender those funds to the government to be used as part of its student loan program.


4. Limit how much money educational institutions can spend on sports activities. More and more schools are spending more and more money on sports and more and more students are spending more and more of their time on sports activities rather than studying. This whole trend of sportization of educational institutions is hurting the standard of our educational system.


5. There are just too many universities and colleges, duplicating the administrative overhead and other expenses for common functions. We should find a way to encourage the institutions to merge to reduce the costs and pass along those savings to the students.