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January 17, 2012 3:50 PM Tuition: Whose Bargain?

By Daniel Luzer

Vice President Joe Biden, visiting Ohio, recently spoke about the Obama administration’s efforts to make a college education cheaper. According to the White House:

Speaking at Lincoln High School in Columbus, Ohio on Thursday, the Vice President called for the “bargain with the middle class” to be restored: “There was a bargain in place for last 50 years that if you worked hard, you played by the rules, you helped increase productivity in America, you got a piece of the action. You benefited.”
President Obama and Vice President Biden believe that making college affordable is an essential part of restoring that bargain. Our Administration has increased the maximum Pell Grant award by more than $800 and created the $2,500 per year American Opportunity Tax Credit. Even with more generous grants and tax credits, most college students borrow money to pay for school, so we are also limiting federal student loan payments to 10% of discretionary income.

These efforts are commendable. But such initiatives really don’t do much to restore that bargain with the middle class. That’s because the federal government doesn’t really have that much power to do anything as far as American colleges and their costs are concerned.

The real “bargain” here was between the states and their public universities, which used to be dramatically cheaper and were, in many cases, free for state residents.

Since 1980, the cost of public universities, adjusted for inflation, has tripled. That has everything to do with declining state support for public higher education.

Increased Pell Grants and income-based repayment are a step in the right direction, but such policies do little to “restore the bargain.” The bargain was between citizens and their state legislatures. Inexpensive state universities, generously funded by the state government, provided America with educated, talented, and debt-free graduates. That isn’t true anymore.

In Biden’s Ohio speech he apparently,

…Told the students about his own family’s financial struggle to send him to college and the importance of education to his success: “A college degree was more than a ticket to be able to make a living; it was about who you are… about the American Dream, the dream that your parents could put you in a position where you could do better than they could do.”

Biden earned a bachelor’s degree in history and political science from the University of Delaware in 1965. Tuition at the school was $315 that year. That may have been a financial struggle for his parents but in-state tuition at Delaware’s flagship state university is now $11,192 a year.

If the federal government is to replace the bargain it would actually have to step in where states have dropped the ball. There are a number of reasons why that might not be such a great idea, but it’s time to recognize what’s really going on here.

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