Making it plain in dot-edu land

In March I wrote that the highly-progressive pricing of college in the U.S. was heavily masked behind jargon and codewords -- but actually that concept seems to be coming out from behind the curtain a bit. The University of Chicago just joined the growing list of prominent institutions who are expanding and/or making plain the huge discounting that has long been available to families with lower incomes.

In the U. of C.'s case a $100 million anonymous donation has provided the immediate spur to a new policy: four years of college free for students with family incomes under $60,000. The university hopes to raise another $300 million to make this arrangement permanent and I have no doubt that in the current climate they'll find it.

Quoting that newspaper report: "About 20 universities nationwide—including Northwestern, Columbia and Harvard Universities—already have gone loan-free for students whose family incomes are below a certain threshold. A handful of schools, including Princeton University and Davidson College, have eliminated loans for all students." In reality those policies are only an incremental change from the practices of the last 30 years or so: it's long been true that only a minority of students at the top schools pay close to the full official costs, all the major colleges have been discounting based on ability to pay for decades. But it's certainly clearer and fairer to make that approach plain and simple, and the development departments appear to have caught on that hardly anything else is easier to lure wealthy donors with.

Private colleges may be getting it

Last week I was in full finger-wagging mode at American colleges and universities, but fair's fair: on at least one very big issue they deserve kudos.

I've remarked before that .edu-land today seems to have a perception problem: working-class American families aren't aware of the fact that the cost of going to college is now priced in an extremely (and historically-unprecedented) progressive way. In other words the better off you are the more you pay, and the well-off families paying full sticker price are subsidizing everyone else. But that reality is obscured behind a fog of complex forms and jargon, so lots of families who aren't well off and who see the newspaper headlines quoting $30,000/year sticker prices never even try.

Another sign that the institutions are grasping this comes from the excellent online journal Inside Higher Ed. They report that "several elite private universities and flagship public universities have effectively eliminated loans for students from low-income backgrounds", and that the schools are making this change public.

Other top-level private colleges have in recent years made the "pricing based on ability to pay" reality much more apparent and simpler: Harvard for example eliminated any expectation of family contribution for households earning less than $60,000/year and others are following suit.

This whole trend gets a big happy salute from me for several civic reasons that are probably obvious. It also seems wise from a strictly business point of view provided of course that a given college has a healthy-enough financial base to be not overly reliant on earned income to pay the bills.

The dot-edu sector isn't yet connecting the dots

A consulting firm has just attempted to do to doctoral universities what US News and World Report famously does to American colleges: use various quantitative data to arrive at easily-understood rankings. Inside Higher Ed has a thorough writeup posted.

The consulting firm's chosen headline for their data (that public universities are falling behind private ones in their productivity of PhD-level research) seems highly debatable for a number of reasons covered in that article. Well down in there an administrator from Arizona State, after blurting the usual silly cliche about how "you can say anything with statistics", actually does a nice job detailing core flaws of the specific data being used here. The response from the consulting firm is quite unpersuasive.

For me though this small tempest fits into a broader storyline about this country's educational institutions and experts. Like charitable foundations, that sector still seems mostly to think that 21st-century America is still happy with its 20th-century social contract. There are lots of signs to the contrary, such as the growing public interest in some way to compare institutions' actual productivity other than just taking their word for it. The educational system's customers, which is everybody, are less and less willing to do that and the sector itself continues to fail to offer any other robust way to measure and compare its own output.

Hence we see the current standardized-testing mania that has infected our primary and secondary schools, which everyone agrees has tons of drawbacks -- but so long as educators offer no practicable alternatives that would measure educational results on a wide scale, the parents will keep voting for politicians who impose standardized testing. Looking at colleges and universities its clear that a similar dynamic is underway: the educators insist that their output cannot be measured objectively and respond to college and university rankings mainly by deploring the very idea.

That "trust us to know what's best for your children" attitude will not wash in today's world, and a good thing too. Moreover this society's expectations about transparency have moved way past what the .edu sector gets -- 15 years ago Congress had to pass a tough federal law just to get universities to admit how many young women were being date-raped on their campuses. If colleges and universities don't feel like getting serious about identifying measurable, transparent, regular ways to document and compare their output, it will be done for them. Slowly, erratically, clumsily and who knows how intelligently -- but it will.

Progressive pricing of education

The New York Times seems to have just discovered, in a front-page story today, the way that private colleges price their services in the U.S.: charging families higher or lower tuition based on what they're able to pay. I'm not sure why this is news -- when I was in college the financial-aid office was perfectly candid about it.

Maybe its just the cute news angle they found, about several colleges which only woke up to the game recently and discovered that raising its tuition made it seem like a better school. So they raise the tuition by 18% and the financial-aid pool by 20% and promptly start getting more applications, because full-cost-paying families assume that a place that costs more must be better. (Or perhaps because .edu-world currently offers its customers no single quantifiable measurement of quality other than sticker price, and bitterly resists attempts to create one such as the US News and World Report rankings.)

I was surprised at just how progressive private-college pricing has become: "aid is now so extensive that more than 73 percent of undergraduates attending private four-year institutions received it in the school year that ended in 2004, not even counting loans." And I happened recently in my office to hear, from the executive director of an association of small Midwestern colleges, another point made in the article: "some students may not even apply to private colleges, scared away from the start by tuition and unaware of the available discounts." The solution to which is, of course, clueing them in to the system and the opportunity to benefit from it. (Like the first time an older relative explained to you that nobody actually pays the listed price at a used-car dealership.)

The article did quote someone raising the familiar spectre of a "squeeze of the middle class": upper-income families can pay full sticker price while poor families get lots of aid. No actual data was offered to back that up, and since the article notes that aid is offered to families earning as much as $150,000/year if they have several kids, the worry seems to depend on a rather expansive definition of "middle class". Or for that matter of "squeeze."

Other than sardonic amusement at the discomfort of certain parties with discovering that they must deal with (horrors!) market dynamics like supply and demand, I'm fine with all this. Access to the finest system of higher education on the planet is being priced in a highly progressive manner? Works for me.