Eagle Forum Legislative Alerts

Monday, March 24, 2014

Government Money Raises College Costs

It’s no secret that college prices are out of control. This is partly thanks to the availability of government money. When the government throws money at something, it always gets more expensive. And the government has been throwing money at colleges for forty years. The end of the baby boom in the 1970s left colleges with shrinking enrollments that couldn’t support their budget, and so the government stepped in with student loans. Enrollment increased and the government decided that “everybody” should go to college. Since colleges now had more money, they began using it for the fluff programs and administrative bloat. Then they raised tuition.

Today, we have people investing six-figure sums in college educations. 71% of students who graduated in 2012 had a student loan debt, with an average debt of almost $30,000 – a figure that increases every year. Many graduates owe more than $100,000. At the same time, 40% of college graduates have jobs that don’t require college degrees. That’s partly because there simply aren’t enough degree-level jobs to go around. We have more college graduates than the economy needs. It’s a problem of supply and demand.

President Obama has called far more college graduates and more government loans, but the reality is that we need fewer college graduates, need less federal aid, and fewer government loans. Less government funding will mean fewer students will go to college, coming out with high debts and getting only low-paying jobs. It will also mean that students will be forced to think harder about their investment and choose a university with an eye to costs. Colleges will be forced to cut costs by eliminating unnecessary programs and focusing on really educating students.

If higher education costs are ever going to reduce, the government will have to step back and let the market work.

Listen to the radio commentary here:

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