Borrowed schooling

October 23, 2005

Go to college, parents everywhere tell their kids. Data back up their advice: Workers with four-year degrees earn 62 percent more than high school grads. No wonder more kids are aiming for college.

But this flood of aspirants has created a seller's market for public and private schools, one in which there's too little restraint on the price of higher learning. And with ever-rising tuition and too-limited financial aid, family income - not student achievement - persists as too large a factor in determining who makes it to and through college, an unhealthy dynamic for this society.

If you're looking for any good news in this, the College Board reported last week that tuition and fees at U.S. colleges moderated somewhat in 2005 - rising 7.1 percent at public schools and 5.9 at private ones.

But though these rates of increases were down from those of recent years, they were about double the rate of inflation and they far outstripped U.S. family income growth. Exacerbating the college financial crunch, average federal grants and loans per recipient haven't grown by much this decade, trailing the pace of college price increases.

The result, the College Board found: College students are borrowing more and more to pay for their schooling. About half of all student aid now comes as loans, and students typically are now graduating with $15,000 to $20,000 in debt to repay - the fastest-growing share of which are private loans with much higher rates than federal loans (including significant borrowing via credit cards). That debt total doesn't include loans taken out by parents, which at elite colleges can easily exceed $50,000 over four years.

The growing reliance on loans is not surprising given that the average net price for U.S. public universities - tuition and fees less grants and education tax credits - now exceeds $11,600 a year. But the interest payments on these loans, of course, only adds to the rising cost of college, and repaying them surely serves to limit more advanced schooling and career options.

In that vein, a recent positive trend among high-ranked colleges - including Harvard and the University of Maryland, College Park - is to offer low-income students sufficient grants to cover all costs. More broadly, Maryland, like many states, offers as much as $13,800 a year to very low-income residents who attend in-state colleges; last fiscal year, about 1,200 received almost $7,000 each.

But while much-needed, such efforts dampen only somewhat the role of family income in college access. A long-term study released this year by the U.S. Department of Education shows that low-income but high-achieving eighth-graders stand less than a one-in-three chance of graduating from college - about the same as high-income but low-achieving eighth-graders.

U.S. schools have never matched their myth of meritocracy. But in this age of growing global competition and domestic diversity, moving further away from that ideal is a dangerous social and economic trend. Just as parents across this country increasingly are in sticker shock over the cost of college, the nation as a whole ought to be alarmed that higher education increasingly is synonymous with going into long-term hock.

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