The College Affordability Myth

Today’s Milwaukee Journal Sentinel features a blaring headline warning that some group has given Wisconsin an “F” in helping students with college financial aid.  Sounds pretty serious  – we must really be falling behind other states in offering financial aid, huh?

Well, actually, no.  Forty-nine of the fifty states got grades of “F” for affordability, which might make one think this bogus “study” might just be a crass ploy by the National Center for Public Policy and Higher Education to push for more taxpayer money.  And one would be right.  Couldn’t the Journal Sentinel just as easily have written the headline “Wisconsin Keeping Up With College Affordability?”

You may notice that college “affordability” to university bureaucrats always means “more taxpayer money,” never “keeping tuition down.”  Universities never like to keep college affordable by charging less for their services – they only consider college attainable when they can jack up tuition, then get the state to pump more taxpayer money in to subsidize the college educations of the poor.  This allows them to continue paying their armies of administrators their lavish salaries.  They get you coming and going.

In fact, in terms of “affordability” in the sense normal people would define the word, Wisconsin is doing extremely well.  Wisconsin ranks second to last in the Big Ten in tuition, even after Governor Jim Doyle proposed significant increases in the 2004 and 2005 school years.  Here’s the list of resident undergraduate tuition at Midwestern Big Ten schools, courtesy of the Legislative Fiscal Bureau:

Michigan $9,798
Illinois 8,634
Michigan State 8,262
Minnesota 8,599
Ohio State 8,082
Indiana 7,652
Purdue 6,458
UW-Madison 6,280
Iowa 5,612

Ah, but you see, Wisconsin is not “affordable,” since we’re not spending enough taxpayer money on financial aid.  Or are we?

In the 1998-99 fiscal year, the state spent $17.5 million on the Wisconsin Higher Education Grant (WHEG) for UW students.  By 2006-07, that number had more than doubled, to $39.2 million.  (Although, admittedly, it dipped slightly in 06-07 after an immense 22% one-year increase in 2005-06.)  Much of that WHEG increase was implemented to make up for the aforementioned tuition increases meant to offset a general purpose revenue cut to the UW in the 03-05 biennium.

The Measuring Up “study” on which the Journal Sentinel breathlessly reports takes none of this into account.  Nor does it take into account the quality of a university.  Let’s say, for argument’s sake, the University of Mississippi funds a slightly higher percentage of pell grant recipients than Wisconsin.  Does that mean Mississippi is a more desirable school to attend?  Does the fact that (to their credit) the UW-Madison offers a world class education so cheaply factor in at all?

If Wisconsin is serious about keeping school “affordable,” it should look at holding down tuition – not raising tuition, then turning to the taxpayers for even more money to allow lower income students access.  In fact, some studies suggest that increased financial aid has the effect of increasing tuition – if universities know so many government loans and grants are available, they can raise tuition to take advantage of the inflation.

UPDATE:  John Hood at the National Review adds some worthwhile observations.