Perhaps the best known economic tenet is that of supply and demand: The more scarce something is, the greater its value.
The obvious corollary is just as true but often ignored: the greater the supply, the lower the value. That truth applies to money just at it does to anything else.
These facts are only functions of a greater truth: The market always corrects itself.
It should be of no surprise, therefore, that one of the greatest contributors to the rapid increase in the cost of attending college is the steady increase in the money the government pours into higher education.
Like most other cases of government meddling, education assistance began with the best of intentions, to make the dream of college more accessible to more people. And like most government programs, this brings countless unintended consequences, consequences that should have been evident if the idea had been thought out and discussed properly.
The National Center for Public Policy and Higher Education’s latest biennial report on the affordability of higher education gives a failing grade to 49 of the 50 states, including New Mexico and Texas, based on the growing percentage of household income required to send a student to college. Only California passed, with a “C” grade based on relatively low community college tuition.
Many of the same people who passed the legislation and created the programs that are shoveling money into the system are complaining about the growing cost. That’s like watering the lawn and then complaining the ground is muddy.
It’s hard to fault those who wish to help lower-income students achieve their dream of going to college. This help, however, increases the pool of students, which increases the demand for classrooms, professors and the accompanying university services and infrastructure, and this adds to overall costs, which lead to higher tuition and fees.
Unfortunately, financial aid doesn’t ease the burden, but shifts it to another part of the population.
While it enables lower-income students a chance to go to college, it can make the cost prohibitive for many middle-class families that don’t qualify for government assistance or who, out of principle, believe they shouldn’t burden taxpayers with the cost of their own education.
In efforts to continue pursuing the dream of an education and the ultimate rewards it promises, many of these families take on massive debt to pay for college, debt they might not have had to bear if constant infusions of government money weren’t artificially raising tuition costs by cheapening the respective value of money within the system.
Some find the only way they can pursue that dream is to enroll part time, while working so they can pay for their classes. These responsible students are further penalized when universities, in the name of improving graduation rates, impose higher tuition for students who don’t earn their degrees within a certain number of years.
It isn’t realistic to expect lawmakers and higher education officials to decide that taxpayers can no longer afford to maintain current levels of education assistance. They should, however, recognize the steady inflation these programs cause.
Ultimately they should decide whether to address their influence on the cost of going to college or just stop complaining about them.