rob f

May 6th, 2015 at 9:19 AM ^

For the youngsters on the board and/or non-baseball fans, Detroit Tigers Hall of Famer All Kaline was offered---and turned down---a $100,000 contract offer by Tigers GM Jim Campbell, back in the days before free agency when there were probably less than a dozen players in MLB making that kind of dough. Kaline declined the offer, stating he hadn't earned such a large contract. Only after having a statistically better season in '71 did Kaline become the first Tiger to make 6 figures.

mjv

May 6th, 2015 at 3:06 AM ^

This issue is that due to the massive expansion in student loans, the "market" demand has become far more inelastic.  The resistance to cost increases from the consumer has been muted.  

I would never suggest that someone take less money than they are being offered.  The problem is that economic forces are being warped by availability of student loans.  And the very programs constructed with the belief of making college more affordable are having the exact opposite effect.

JMEISTER

May 6th, 2015 at 7:04 AM ^

There is no good reason the cost of a college education should cost 25 to 30 times what it did when I attended. Nothing else does! Not food, or utilities or even gasoline. Not even close. It's a huge money grab by many of those who like to carelessly toss around the term 'greed'.

Everyone Murders

May 6th, 2015 at 9:10 AM ^

This is a compelling argument with a lot of intuitive appeal.  It sounds right to me, and this had not occurred to me before.  (I believe in a parallel cause which is the wrong-headed notion that every kid in the US "deserves" to go to college, when in fact many of them gain little to nothing by attending - except a buttload of debt.  But try to tell that to someone who is sincerely chasing their life-ambition at DeVry, etc.)

Do you have any studies or data to support your theory, mjv?  Again, it sounds valid to me, but it would be great to see analysis to support the hypothesis.

justingoblue

May 5th, 2015 at 7:59 PM ^

Assuming they're accurate, he's got some solid figures to back up his conclusion, but student loans are a glaring omission only mentioned in juxtaposition with baby boomers paying out of pocket.

No decrease in demand despite higher prices will push prices even higher, which means there's zero incentive for rolling back any of these new costs. Any real solution has to take the changes made in loans as well as administration (and state funding and shiny new things on campus, and everything else) into account.

pdgoblue25

May 6th, 2015 at 9:23 AM ^

positions in the trades.  My buddy took over his father's plumbing business and he has to turn jobs down left and right.  I ram in to this problem the other day, a friend asked me if I knew a good electrician, and I realized that I don't.  I don't know a good roofer either.

I took welding for 2 years in high school, and I know if I practiced for a month or two I could get the hang of it back again.  I know for a fact I could be making more money as a welder than I am right now, but potential earnings in my current industry with my degree are much higher down the road.

Robbie Moore

May 5th, 2015 at 8:36 PM ^

Justingoblue nailed it. The explosion of student loan debt acts as a subsidy for increased college costs. We are loading up a generation of graduates with debt it will take decades to pay off just to kick the can down the road. Over the years how do these graduates save anything towards their children's education? Exponentially more debt will be required to educate that generation. This is a bubble and when it bursts the entire higher education system in America will be leveled.

There is all this talk about HARBAUGH being some kind of savior. The real savior will be the person who figures a way out of this mess.

Farnn

May 5th, 2015 at 8:51 PM ^

The way out will be painful and extremely unpopular because the opponents will paint it as being anti-opportunity.  The easiest way would be to simply take away the guarantee of repayment and allow student loan debt to be wiped out with bankruptcy.  Lenders will become more selective and probably raise rates and fewer people will go to college.

justingoblue

May 5th, 2015 at 9:00 PM ^

Trying to walk the tightrope between politics and political process, but it's not even as simple as your comment because the loans are administered through the DOE and serviced by banks with lobbying interests as well. A lot of the student aid program is actually done by statute, which means changing anything like interest rates will require rolling back existing programs and prior legislation, which is extremely tough to get done.

I'd be breaking the no politics rule to say much about what I think should be done, but I think most can agree that we've gotten ourselves into a shitty situation.

mjv

May 6th, 2015 at 3:13 AM ^

Your point on bank lobbying is spot on.  There is ZERO chance that the Too Big Too Fail cabal will allow themselves to be exposed to the risk of default from students declaring bankruptcy.  And if it somehow did come to pass, recent history has demonstrated that the losses would be passed along to the tax payers.

SWPro

May 6th, 2015 at 8:02 AM ^

Reduce the amount the student gets saddled with.

Cut available loans baco but use the money to provide an abundance of low cost/free 2 year community colleges.

Make loans available to juniors/seniors only and only if you did 2 years at CC.

Rich folks can pay for expensive education for 4 years. Not rich folks can cut the expected debt in half and get the same degree as their better off counterparts.

Require college s that get state funding to support the development of curriculum for the CCs to ensure students are ready for the transition and credits will transfer.

SWPro

May 6th, 2015 at 7:56 AM ^

This article and your spot on reply are a beautiful example of correlation vs causation.

This article wants to paint it as "aministration went up so tuition shot up out of control to pay for it".

The reality is simple supply vs demand. Demand went up like crazy due to new ways to pay for it and the amount of available slots didn't increase at the same rate. The result? Increased cost.

GoBLUinTX

May 5th, 2015 at 8:05 PM ^

Cheap easy money is why tuition continues to rise unabated.  So long as the pockets are deep and lush with cash and there's no incentive for institutions to compete for dollars which aren't scarce, they'll continue to raise tutiion and spend the windfall on such niceites as administration costs.  

JDW

May 5th, 2015 at 8:05 PM ^

The supply and demand of the student aid and I have heard that about 80 percent of all revenue increase s go to administation costs both primary and secondary schools

wolverinebutt

May 5th, 2015 at 8:10 PM ^

I attended college in the 1970's(Walmart Wolverine).  The buildings, dorms, athletic areas were clean, but nothing fancy.  The dorm food was lower cost, but filling.

When I looked at colleges with my 3 kids I was amazed at the sparkling modern dorms and other fancy buildings.  The variety of food choices was also amazing.  I am glad the younger generation had first class colleges, but this all comes with a price.  Lower student debt with be worth going back to old school college basics.  

   

MaizeAndBlueWahoo

May 6th, 2015 at 6:59 AM ^

Besides the student loan issue, I'm disappointed the article didn't mention the proliferation of shiny palaces on campuses.  Dorms, dining halls, classrooms - every building is starting to be gold-plated.  The author provided one figure to back up his claim: a four-fold rise in the number of administrators.  Well, tuition has gone up much more than four-fold.  Probably the only expense that has kept pace with the tuition hikes is capital and building expenditures.  There's the culprit.

Bando Calrissian

May 6th, 2015 at 10:02 AM ^

As a former East Quad resident, the fact that in 2015, the Halfass is gone and the cafeteria has a gelato bar is nothing short of astounding. Working with undergrads every day at a private school now, I can't believe the shit that goes into the college arms race now. They feel entitled to the cushiest bullshit.

Sent from MGoBlog HD for iPhone & iPad

dupont circle

May 6th, 2015 at 10:39 AM ^

More or less only the wealthy attend high end colleges (like U-M) because it takes lots of money to GROOM a kid that can get into these colleges. "Punishing" these rich kids with goulash and humid dorms seems silly. The kids at U-M in '15 run circles around the kids that were there in '85. Further, cut the comfort and the sharpest kids have the options to funnel to schools that offer the comfort they're used to.

Gameboy

May 5th, 2015 at 8:16 PM ^

His math is terrible. He just glosses over the fact that per student spending has drastically decreased over the years and just posts the fact that overall spending has increased (due to being there are more students!).

This is really a very very bad analysis. I am embarassed that a UM alum wrote it.

Gameboy

May 5th, 2015 at 8:36 PM ^

http://www.slate.com/blogs/moneybox/2015/04/06/why_is_college_so_expens…

25% to 30% decrease is pretty drastic.

What is really awful is that he uses overall numbers for state aid, but uses per student numbers for costs. He is comparing apples to oranges.

Apples to apples comparison would have been bad enough, but he is using intellectually dishonest slight of hand here and that is embarassing.

gbdub

May 5th, 2015 at 8:49 PM ^

Of course the number of students per capita is going up as well. Is college funding per taxpayer going down? I doubt that number is as drastic.

And anyway, costs per student have gone up a hell of a lot more than 30%, so to blame it mostly on state funding decreases is still pretty wrong

Sent from MGoBlog HD for iPhone & iPad

snarling wolverine

May 5th, 2015 at 9:18 PM ^

A 25-30% decrease is important, to be sure.  Campos may be downplaying that a bit too much.  But tuition at U-M (and most other schools) has increased by around 100% over the last 15 years.  

The column reports that there was a 60% increase in administrative positions (not costs, but positions) from 1993-2009, which is staggering.   The article you linked in your post acknowledges that this is an issue.  Are all these new positions necessary?  Yeah, there's been the growth of IT, but still, I can't imagine how there can be such a need for that many more administrative employees.

 

 

rainingmaize

May 6th, 2015 at 12:30 PM ^

My guess is that the majority of those new additions in administration come from two areas. The first is a direct result of dealing with more college students and the massive student loans that come with it. The main reason, in my opinion, is an increase in student services personnel. These positions include academic advisors, counselors, athletics administrators, career counselors, and admission officers. These positions are in place as another resource in the collegiate "arms race" that have resulted in the construction boom. They are also there to insure a higher retention rate.

rainingmaize

May 6th, 2015 at 12:30 PM ^

My guess is that the majority of those new additions in administration come from two areas. The first is a direct result of dealing with more college students and the massive student loans that come with it. The main reason, in my opinion, is an increase in student services personnel. These positions include academic advisors, counselors, athletics administrators, career counselors, and admission officers. These positions are in place as another resource in the collegiate "arms race" that have resulted in the construction boom. They are also there to insure a higher retention rate.

rainingmaize

May 6th, 2015 at 12:30 PM ^

My guess is that the majority of those new additions in administration come from two areas. The first is a direct result of dealing with more college students and the massive student loans that come with it. The main reason, in my opinion, is an increase in student services personnel. These positions include academic advisors, counselors, athletics administrators, career counselors, and admission officers. These positions are in place as another resource in the collegiate "arms race" that have resulted in the construction boom. They are also there to insure a higher retention rate.

rainingmaize

May 6th, 2015 at 12:30 PM ^

My guess is that the majority of those new additions in administration come from two areas. The first is a direct result of dealing with more college students and the massive student loans that come with it. The main reason, in my opinion, is an increase in student services personnel. These positions include academic advisors, counselors, athletics administrators, career counselors, and admission officers. These positions are in place as another resource in the collegiate "arms race" that have resulted in the construction boom. They are also there to insure a higher retention rate.

snarling wolverine

May 5th, 2015 at 8:30 PM ^

Campos says per-student funding is "somewhat lower" than it was in 1990.  Do you have the precise figures?

In any event, he notes that even as per-student funding was increasing, from the '60s to the '90s, tuition was also increasing dramatically.  There clearly are factors that go beyond levels of state aid.  Tuition is skyrocketing everywhere, at public schools in every state and also at private schools.  

 

 

 

Muttley

May 5th, 2015 at 11:10 PM ^

Now they are driven by money.

IMO, all of this focus on the cost side ignores the elephant in the room.  A college degree has demonstrable economic value to the graduating student.  Altruistic universities which once left a lot of that value on the table in a different era now extract close to its full value.  Of course, costs will follow; note the Taj Mahal academic facilities of today versus the functional facilities of yesteryear. 

We ain't goin' back to the days of lower money influence, either in major college sports or in university budgeting.  In this regard, we geezers had it better than the kids today.  Going to college was a slam dunk financial decision for just about everyone back in my day.  Now, the marginal student might be well advised to look at alternative paths.

sheepdog

May 5th, 2015 at 8:23 PM ^

Student loans are government guaranteed for the universities and non bankruptable for the student. What incentive do universities have to make tuition affordable when anyone can go with a cheap loan and they can't default on the deal?

Sent from MGoBlog HD for iPhone & iPad

Mgobowl

May 6th, 2015 at 12:56 AM ^

Let me just point out, the "cheap loans" are not always that cheap. 

For example, some of my loans are 7.9%... and I'm in a profession that is generally expected to perform well over the long term. 

My problem with the education system is that there is demonstrated need for dentists, doctors, physical therapists, etc per peer reviewed research from the ADA, AMA, etc, yet they are charging insane rates to educate these people. The alternative is to import people from foreign trained schools with unknown qualifications... having interacted with these people has given me the opinion that it's a crap shot. 

There should be some incentive to go into professions that are in demand or demonstrated to be in demand in the future, instead of giving every history/english/social science person every loan they ask for.

Quail2theVict0r

May 5th, 2015 at 8:25 PM ^

It's certainly an interesting discussion. What is missing is the qualifications said University Administrators today vs. what they used to be. I don't know how it was in the 1960's, but today college administrators tend to be highly educated individuals themselves -- ones with plenty of degrees to hang on the wall and ones who may have even been faculty members at one point. There's this whole recruiting thing that goes on now, trying to get the best names in the department to rank higher compared to the other schools. In tern, getting the better kids to come and spend their money here so the University can brag about their successes after graduation. I think you'd be hard pressed to find simple undergraduate degree holding individuals in Administration positions at UM. And when people get doctorate degrees in things, there's an expectation, especially in academics, that they get paid for well. 

Somehow I still don't believe that even high adminstration costs adds up to OOS students paying $40,000 a semester. I mean, think about that. There's like 40,000 UM students and about half or more are OOS students. Even if your average adminstrator makes $120,000 a year, that's only 3 out of state students to pay for that. It just doesn't seem like it's a large enough number to really impact tuition rates as much as it has.