College Guide


December 11, 2009 12:08 PM Merit Scholarships: Rob from the Poor, Give to the Rich?

By Daniel Luzer


Michigan Lt. Gov. John Cherry proposed refunding the recently eliminated Michigan Promise scholarship program through a tax on bottled water companies. Cherry said a tax of 10 cents a bottle could generate $118 million per year.

But University of Michigan President Mary Sue Coleman essentially rejected the idea: “Financial aid in the state of Michigan should be need-based,” Coleman said. “The Promise scholarships are not need-based.”

Coleman has a point. Donald E. Heller at the University of Michigan demonstrated that about one-quarter of students in Michigan’s richest communities qualified for Michigan Promise scholarships. But only six percent of students who lived in the state’s poorest regions qualified.

The scholarship had a very limited effect on increasing the rate of college attendance in the state. Most poor kids didn’t qualify for the scholarship; most kids who did qualify would have gone to college even without it. As Heller explained, merit scholarships “channel money away from students who need the financial assistance to enable them to attend college, and award it to students who are likely to attend college without the financial help.”

The Michigan program, however, was not nearly as odd as the scholarship situations in some states. Both Georgia’s HOPE Scholarship and West Virginia’s PROMISE Scholarship, for example, are funded by state lotteries. People who play the lottery tend to be low income and uneducated. Essentially the scholarships represent an indirect transfer of money from the states’ poor to the states’ rich.

Daniel Luzer is the news editor at Governing Magazine and former web editor of the Washington Monthly. Find him on Twitter: @Daniel_Luzer


  • Walker on December 13, 2009 1:39 PM:

    Merit scholarships are not intended to increase university accessibility. They are intended for a different purpose. They are to allow state universities to compete with the elites in terms of getting top students. Top students are desirable because they help universities compete in faculty hiring; top faculty want to go where the good students are.

    Looking at this from a policy standpoint, what you really want to urge a university to do is to have merit scholarships that extend to out-of-state students. This would mean that these are even more competitive, and would make the university attractive to other out-of-state students that would pay greater tuition.

  • Iceman on December 15, 2009 2:44 PM:

    "Donald E. Heller at the University of Michigan demonstrated that about one-quarter of students in Michiganís richest communities qualified for Michigan Promise scholarships. But only six percent of students who lived in the stateís poorest regions qualified."

    Why would this be surprising, if the richest communities have much better schools than the poorer ones? Whether scholarship money should be based on merit or need is a different issue, but there are real reasons for merit scholarships that have nothing to do with increasing the number of poorer students in college. Already there is a rapid brain drain from places like Michigan and Georgia - their brightest young people go to elite colleges, and then go to New York, Boston, San Francisco, DC, after they graduate. Merit scholarships help keep more of those students in state universities and then have more of a chance of staying in the state after they graduate. If you go from Detroit or Saginaw to NYU, you aren't coming back. Does Michigan really want even more of its top students to go out of state?

    In contrast with the first poster, I think the real issue is retaining top students in state rather than attracting top faculty - the academic job market is in such terrible shape in liberal arts fields that only the real superstars are in any position to pick and choose, and many highly qualified people are teaching in fourth-tier colleges in East Podunk.

  • chogyal dorji on January 22, 2010 11:30 PM:

    This is my point that. i have gone through your website . so i am poorfamily socitey, that i dont have fancical backgroud for my fether studies. which i cannot effrot my life ,