Pogo, the long-running comic strip by Walt Kelly, is perhaps best known for the quote “We have met the enemy and he is us.” This quote comes from an early 1970s Earth Day poster that shows Pogo looking out on a forest floor filled with garbage. Kelly’s hope, of course, was that if people realize they are part of the problem they will also realize that they can be part of the solution.
I am often reminded of that quote when people ask me what should be done about rising college costs. It is true that tuition and fees are rising faster than the rate of inflation. According to the College Board’s Trends in College Pricing 2011, in-state tuition and fees at public four year colleges and universities has increased at an annual rate of 5.6 percent above the Consumer Price Index during the last decade! Private institutions over this same time period increased at a lower (but still large) annual rate of 2.6 percent above inflation.
While there are many drivers of higher tuition and fees – from Baumol’s cost disease to the Bennett hypothesis to declining state aid to higher education – at the end of the day tuition and fees can only rise if there is someone willing to pay. In the past, students and families were happy to do so because a college degree was seen as paying for itself in that it generally led to much higher paying jobs. Recent news stories and research by my colleague Richard Vedder however, shows a huge disconnect between what many students are spending for their degrees and what those degrees are worth in the marketplace.
The current situation will not get better until students and families begin to realize the role they play with respect to rising college costs. The time has long passed where all but the wealthiest students and families can think about college without taking a hard look at costs and benefits. Please note that I am not suggesting that students need to “give up on their dreams.” Rather I am suggesting that in the face of this new information, students need to respond appropriately by becoming more cost conscious. If they don’t, college costs will continue to rise regardless of how higher ed policy changes.