College Guide


December 05, 2011 3:27 PM White House Meeting on College Costs

By Daniel Luzer

President Obama has apparently invited higher education leaders to the White House to discuss college costs.

According to an article by Jenna Johnson in the Washington Post:

President Obama is scheduled to meet privately with a small group of university and college presidents Monday morning for a candid discussion about why higher education costs so much — and if that price tag is hindering accessibility and graduation rates.
While college presidents often meet with federal officials to discuss these issues, this meeting has been deemed unusual, as it was announced at the last minute and will be held behind closed doors with Obama. And it is happening at a crucial time, as student loan debt is poised to hit $1 trillion, administrators and coaches are paid hefty salaries and students occupy their campuses in protest.

Officials discussing the great mystery of college costs apparently include the chancellor of the State University of New York, the chancellor of the University of Texas System, the chancellor of the University System of Maryland, the head of the University of North Carolina at Chapel Hill, the president of the University of Maryland at Baltimore County, and the president of California State University at Long Beach.

Additional guests include the president of Indiana’s Ivy Tech Community College, the president of Carnegie Mellon University, the president of the tuition-free Berea College, and the president of the all-online Western Governors University.

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


  • Snarki, child of Loki on December 07, 2011 8:26 AM:

    President Obama is scheduled to meet privately with a small group of university and college presidents Monday morning for a candid discussion about why higher education costs so much

    ...and I have no doubt he'll hear a lot about "burdensome regulation" driving up tuition costs.

    Except that it isn't. It's just supply (limited) and demand (large), with sticky prices and imperfect competition.

    Back when public universities were actually funded, they acted like a "public option" and helped to keep overall tuition under control by competition with private and less-well-funded public universities.

    The "skyrocketing administrative cost" is an EFFECT not a CAUSE, because non-profit colleges don't pay dividends or have stock options to distribute profits, they have to roll that excess money back into the enterprise. And the administrators decided: administration is more important.

    I said it before, I'll say it again, three things need to be done:

    1. Fund public universities to re-introduce a 'public option' to college tuition competition.

    2. Mandate that colleges will lose their non-profit status if they spend more than 25% (or similar) personnel cost on administration. This should result in more faculty working as part-time administrators, which is good for keeping the focus on education instead of administration. And costs much less.

    3. Increase supply of higher ed, long term by making it a bit easier to set up new colleges, but short term and more practically by encouraging expansion of existing colleges with
    building, hiring, and setting up satellite campuses, which
    *can* be done quickly.

    For #3, federal grants could help and would be a welcome economic stimulus, but just changes to the tax and accounting rules would help a lot, allowing and encouraging the current excess "profit" to be used for expansion. The changes to tax and accounting laws is something the federal government has to do, but I doubt very much that a gaggle of university brass would even consider asking for it.