College, the New Luxury Item

HOW WILL THE NONRICH PAY FOR IT?

A sad little story has been unfolding at Santa Monica Community College in Southern California. Santa Monica is apparently one of the better two-year colleges in the state, with some thirty-four thousand students and an excellent record of students moving on to the state’s four-year system.

But its success has led to a steady increase in applications even as state-college budgets have been cut sharply. Kids have also learned which programs are most likely to lead to jobs—health technologies, computer programming, bookkeeping—so those are swamped with applicants.

Santa Monica decided that it could expand the favored programs if it charged students the full cost of running them. California’s two-year college tuition is $36 per credit hour. A full-year thirty-credit program would therefore cost $1,080, which is very reasonable. With no state subsidy, the break-even cost rises to $180 per hour, or $5,400. That’s a big jump, but not out of line with public college tuitions in many other states.

One shouldn’t condemn the Santa Monica administration. Working-class kids clearly want employment-related training. If the public systems won’t provide it, for-profit “technical schools” will step in, likely charging much more while providing an inferior product. But the optics of the price increase are still dreadful. Students predictably protested, campus police used pepper spray on some students, and as of this writing, the state has stepped in and suspended the change. Whatever the final resolution, it is yet another depressing tale of what a mean and desperate nation we are becoming.

Young people have been hit particularly hard by the drawn-out recovery. Entry-level requirements for good jobs have stiffened considerably, especially with respect to math- and science-related competencies. Associate’s degrees are a path to good entry-level jobs in health-care technologies, but they almost all require passing courses in physical anatomy, chemistry, and cellular biology, as well as national certification tests.

Pressure is increased by the “echo boom.” The baby-boomer generation had fewer children than their parents did, and were older when they formed families. But the boomer generation was so big that there was a pronounced uptick in births in the 1980s and early 1990s—“Generation Y”—who are ballooning the ranks of entry-level workers.

The lifetime earnings premium from a college degree is still quite high. On average, a four-year-college graduate earns almost twice as much as someone with just a high-school diploma; a graduate with just an associate degree earns 50 percent more. Overall higher-education enrollments are very high. Compared with 1990, four-year public college enrollments are up by more than a quarter, while community college enrollments are up by a third.

The very first Republican administration, led by Abraham Lincoln, created the land-grant colleges that evolved into today’s public higher-education networks. No other country in the world had conceived of providing advanced education to its farmers and mechanics. Today the public college system enrolls about three-quarters of all undergraduates.

That entire tradition is now at risk. In inflation-adjusted dollars, tuition and fee charges at four-year public colleges have more than doubled since 1990, and are up by 70 percent at two-year colleges. During the same period, unfortunately, the median income for American families increased by only 2.4 percent.

Public financing for higher education has also been flat over those years, and would have been lower, except for federal post-recession stimulus spending, which is now winding down. Relative to the cost of public education, and the growth in enrollments, however, public spending for higher education is dramatically lower. The shortfall has been financed primarily by heavy student debt, now in excess of $1 trillion, which is considerably more than all outstanding revolving credit-card debt. A special provision in the laws governing student debt epitomizes the country’s lack of generosity toward its upwardly mobile nonrich youth: it is one of the only debts that may never be discharged in bankruptcy. No matter what misfortunes you suffer, you’ll owe it till you die.

Now consider the cushioning that is available for the well-off. Aware of the strains of financing college, Harvard University has extended generous aid from its massive endowment to ensure that no students with family incomes of less than $180,000, which is squarely in the top fifth, will be liable for more than 10 percent of their college costs. In other words, the top stratum will take care of their own quite nicely, thank you.

That contrast between Santa Monica Community College and Harvard—the hurdles put in the way of working-class kids and the well-greased pathway to affluence at Harvard—captures much of the sour reality of today’s America.

Published in the 2012-05-04 issue: 
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Charles R. Morris’s most recent book is The Rabble of Dead Money, a history of the Great Depression (PublicAffairs).

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