The Biden commitment to forgive part of college student loans has generated a mixed reaction. Republican critics see it as unfair to those who have repaid their loans and those not attending colleges. This is a complicated issue and not a topic I can address fully here. I would like to take on one piece of this puzzle. This piece concerns the cost of higher education and the role tuition serves paying these costs.
I have a specific context from which I view this issue. I spent 17 years as the chairperson of a Psychology department at a small state public university. I use the word university here in a specific way because so many institutions now describe themselves as universities. My situation was at an institution with multiple graduate programs assuming students in most of these graduate programs would commit to their education full time for several years most likely spending their time working on campus. The institution also generated sufficient external funding and published research to be classified as R1/R2. This ranking is important because it plays a large role in the types of external grant funding you can apply for and are in a position to compete for successfully. Both of these factors are important because they strongly influence both how you must spend money and whether you receive external funding.
The funding for the operation of a university of the type I have described comes from multiple sources – tuition, state appropriations, alumni/other contributions, and grants. The point I want to be understood is that several of these categories are competitive and the institution must spend money to compete for funding. The obvious example here is what it takes to qualify as an R1 institution. To qualify in this category, an institution must have the infrastructure and human capital to be regarded as worth the investment from granting agencies. Grants at this level can be massive and typically come with overhead. This category of the money awarded is intended to cover the infrastructure costs of the university at a general level. So money spent here can be applied to cover costs of buildings and labs, library resources, technology infrastructure, etc. The university’s value beyond supporting the grant’s work is that these services benefit all.
Institutions hoping to compete at this level and perhaps not yet there or on the margin of being successful, face a chicken and egg problem. To compete for this type of money, the institution must have the quality of research faculty producing quality work, the infrastructure necessary to implement a sufficient quantity of such work, graduate students who both support and benefit from involvement in significant work, etc.. You must already be successful to secure the resources you need to be successful. There are special funds set aside for aspiring institutions, but you can only promise so many times and you really need funds from other sources to make it into the highest categories. If not already clear, the faculty and grad students capable of doing the work at this level are more expensive to hire and keep.
Tuition dollars are another category that involves a significant competitive component. The quality of the institution, money available for student support, quality of the athletic programs, living and dining facilities, access to campus health clubs, etc. are all part of the investments that appear to attract some students. The game involves attracting more tuition dollars than what you invest to attract these students. Increasing the tuition and fees charged students can be part of this process and again where does the investment cause the return to head in a negative direction? What do the buildings look like? What does the student Union look like and what amenities does it provide? What meal options are available on student meal plans? Are the tickets to athletic events reduced in price (or free) and how many seats are set aside at the lower price? Does the health club made available to students have plenty of pool space and plenty of basketball courts? Are aerobic classes available and free? Are the programs with low enrollments, high costs, and little chance of securing external funding available just because they provide opportunities that play a role in offering students a total educational experience?
It is my impression that the state support category has decreased and the tuition expectation has increased. Of the four types of resources I have mentioned, all are interrelated and tuition and state support are related closely.
Maybe I am wrong about student expectations for services not directly influencing their classroom experiences. I don’t think so, but I also am careful to describe college as a setting that provides important experiences happening outside of the classroom. Money invested to create a diverse student body is part of this experience. Money spent to encourage a life-long interest in a healthy lifestyle is important.
What about tuition? I believe tuition plays a larger role in the total budget than it used to. Maybe this is fair and maybe not. How much should one expect from the state when only a certain proportion of the citizens benefit directly from a given institution? How much of the increase in tuition is a reaction to the expectations of students and would there be ways to change expectations for unnecessary services? How should state funds be allocated across the type of institution I have described here and the institutions falling into other categories?
My point to everyone jumping to a quick decision about high tuition costs (beyond the issue of loans and loan costs) is that the factors influencing tuition levels and the role tuition plays in college budgets are complicated and there are many interrelated variables that must be considered.
A couple of informative sources related to the tuition controversy: