Priced Out Of Prosperity?

The picture was grim this week as the National Center for Public Policy and Higher Education released a report predicting that a college education could soon become unaffordable for most Americans. In the past 25 years, the cost of college has increased by 439 percent. [The New York Times notes that this figure is not adjusted for inflation.]

When it comes to making schools affordable for their residents, all but one state flunked the center's rubric. Having spoken to people in higher education, this comes as no surprise. Though college costs have increased for a variety of reasons such as health care costs, energy costs, and competitive salaries from faculty, these increases are made far more drastic by a continual reduction of state funding for state schools.

The lack of state funds is often recouped by passing the price on to students. In turn, going to college costs a family a larger percentage of their income than previous years. Low income families are especially hard hit. The New York Times reports that a four-year university education would cost a family making median wages in the bottom quintile of earners 55 percent of its yearly income. In other words, the poorest families would have to contribute more than half of every dollar they make in order to get a four-year degree. And the alternative, community colleges, cost such a family nearly as much.

Of course, financial aid is available for many, but the report reveals shockingly that lower-income students get less than those from more affluent families. This is yet another confirmation of a trend spotted early last year in our report, "Squeeze Play: How Parents and the Public Look at Higher Education Today," which was done with the National Center for Public Policy and Higher Education. Our researchers found that more than ever, people said they believe that many qualified, motivated students don't have an opportunity to go to college. This, at a time when college education is seen as a foundation for a middle class lifestyle.

College is not only necessary on a personal level - it also counts on a national one. As Patrick M. Callan, one of the principal authors of the recent report, points out, "The educational strength of the American population is in the group that's about to retire. In the rest of the world, it's the group that's gone to college since 1990."

The center's report projects that costs will only increase until eventually all but the most affluent Americans will be priced out of the university experience. That is, of course, if nothing changes and costs continue to go up while family incomes continue to go down.

Research underway at Public Agenda is exploring many of the ways different states are trying to hold down cost and increase efficiencies. The recent financial troubles have made this something of an involuntary act. As tax revenues decrease, state budgets often turn towards universities to make cuts.

While some of those may have been long overdue, Callan argues that cutbacks in time of fiscal stress are the opposite of what we need. If the argument is that an educated populace brings greater overall wealth to states and the nation, then now is the time to spend money and effort making college more accessible and affordable, and not to discover that soon very few will be able to afford their mortarboard.

Paul Gasbarra is a research associate for Education Insights, Public Agenda's initiative to help those on the front lines of education reform – teachers, parents, community and school leaders – cooperate more effectively to achieve key education goals. For more on education reform, check out his recent article, Homework For The New Administration And The 111th Congress and feel free to add your own ideas to his "to do" list for our leaders in Washington.