I think the hand-wringing about the trend [in college costs] is greatly exaggerated.
Sandy Baum, College Board
Year after year, College Board faithfully delivers two messages. First, college is a fabulous investment when you consider the life-time difference in earnings between college graduates and high school graduates.
Second, a college education does not cost as much as most people think it does. In fact, last week the College Board issued a report that said the inflation-adjusted cost of attending a private college is actually cheaper than it was ten years ago! That's right. Even though college costs have risen faster than the rate of inflation for the past 30 years, the cost of attending a private college actually went down over the past ten years, according to the College Board.
|Sandy Baum of College Board|
To put it another way, college costs haven't gone up that much for some groups of people. Colleges grant huge discounts to preferred customers. Applicants with high SAT scores get scholarships or grants, because these students help raise colleges' rankings by the various rating entities like U.S. News and World Report.
And low-income students are eligible for Pell Grants. As Andrew Kelly pointed out in a recent blog, Pell grant spending more than doubled between 2008 and 2011, growing from $16 billion to $37.5 billion in just three years. The number of Pell Grant recipients grew by more than 80 percent between 2006 and 2012.
And let's not forget affirmative action. Not only do the leading colleges give minority applicants preference for admission, they generally give these students scholarships and grant aid--particularly at the elite colleges.
Who then pays the sticker price--the sucker price--to attend all these expensive elite colleges? If you are a white person from the middle class with lackluster SAT scores, it's you. Citing a federal study, the College Board acknowledged that families in the second highest quartile of family income saw the cost of attending a private college go up by 8 percent from 2003-2004 to 2011-2012 (as reported by NY Times).
College Board. Trends in College Pricing 2013. Accessible at: http://trends.collegeboard.org/college-pricing
Andrew P. Kelly(2013, October 24. New data on tuition prices: Is it possible it's even worse than we thought? AEI Ideas blog. Accessible at: http://www.aei-ideas.org/2013/10/new-data-on-tuition-prices-is-it-possible-its-even-worse-than-we-thought/
Richard Perez-Pena (2013, October 25). Despite Risking Stick Prices, Actual College Costs Stable Over the Decade, Study Says. New York Times, p. A14.