The Price Problem of
Universities When it comes to tuition (学费) breaks at
well-known universities, it may sound like a good idea. However, they might not
be as good as what they were expected. Stanford is one of the
latest universities that announce a new financial-aid package for those
middle-class families. Harvard University was the first one to come to the aid
of the middle class. Last December, the university announced sweeping changes to
its financial aid policy, eliminating loans and asking students from families
with salaries between $ 120,000 and $ 180,000 to pay no more than l0 percent of
their family’s income to attend. Then came Duke, which vowed to reduce loans for
students with family incomes up to $ 100 ,000 and also try to establish a loan
cap for those wealthier ones. By the end of February, a small group of top
private colleges--such as Yale, Pomona, Swarthmore and, most recently,
Stanford--all announced their own generous financial aid packages for the
middle-income families. The tuition break seems like a very good
idea for most people. During the past years, the most selective schools have
been steadily raising their tuition. However, even until now, they’ve been
ignoring the rising volume of complaints from those middle-class parents of
high-achieving kids, who say that nowadays tuition, room and board at a top
private college, which together have already cost more than $ 40,000 a year in
many places, is too high. They’ve also been ignoring many
enrollment specialists who have long warned that the top schools may soon have a
two-tier student body: those full-paying students from the top echelons of the
wealthy family and those lower-income kids supported by generous financial aid
packages. Nevertheless, what the schools couldn’t ignore was the
pressure from Congress, where members have questioned why colleges enjoy
tax-exempt status at a time when their endowments and theft tuitions are rising.
Last week, 136 of the nation’s richest colleges were asked to answer the
detailed questions posed by the Senate Finance Committee on their endowments and
financial aid policies. The fact-finding letters were sent by Iowa Republican
Sen. Chuck Grassley, who also held hearings last fall on the growth of college
endowments. How did he try to draw the schools’ attention Grassley began to
discuss legislation that would require colleges and universities, like other
private foundations, to pay out 5 percent of their assets each year toward
charitable purposes, or lose their tax-exempt status, Jill Kozeny, an aide to
Grassley, said in an e-mail that the senator would be using information provided
by the colleges and universities "to evaluate theft endowments’ activities in
the con- text of tax-exempt laws and the accompanying obligations to taxpayers
and donors". Some people applaud the middle-class college
bailout(摆脱财务困境). "For years top schools have been locked in an arms race,
building lavish facilities for their students," says Richard Vedder, director of
the Center for College Affordability and Productivity. "It’s nice to see they
are finally competing on price." But economists say the effects
of it may be far-reaching and not all together rosy. For those starters, it will
put a lot of pressure on flagship (旗舰级的)public schools, which traditionally
educate some of the brightest kids, although they are not necessarily the
richest. Formerly, a high-achieving middleclass kid from Lansing, Mich. , might
get accepted at both Harvard and the University of Michigan but opt to stay
in-state and graduate debt-free. Now it may be cheaper for that student to
attend Harvard. University of Michigan spokeswoman Kelly Cunningham says the
school is monitoring the developments. "We’ll probably know the effects over the
next few years, as prospective students identify and respond to these
opportunities," she told NEWSWEEK in an e-mail. John Blackburn, dean of
admissions at the University of Virginia, says the new policies at the Ivies
will hurt’, but not too much. Yes, other colleges will lose more top students to
the most selective schools that are pro- viding a great deal of financial aid to
the middle class, he noted. But the Ivies have long skimmed the cream off his
candidate pool. "What you have to remember is that (even with the new financial
aid policies) the number of kids that we’re talking about is very small," says
Blackburn. At second-and-third-tier private universities,
though, the impact could be much more severe. "We do provide what we think are
very generous financial aid packages for the middle class," says Colgate
University’s David Hale, vice president for Finance and administration. But
Colgate, with an endowment of $ 700 million, has less prestige and can’t provide
the kind of handouts that Harvard, with its $ 34 billion endowment, can. Colgate
isn’t changing its financial aid policy, says Hale, "but we do have to be aware
of What’s going on. Schools really compete hard with each other for those
students," Economist Ronald Ehrenberg, director of the Cornel1
Higher Education Research Institute, thinks he knows how the new policies will
play out for schools like Colgate, and he’s worried. "Each institution wants to
maintain their place in the pecking order(权势等级) ," says Ehrenberg. Top colleges
have signaled their intention to use their considerable endowments to bid
against each other "for the same small group of talented middle-class students".
Second-tier and third-tier schools, which aren’t sitting on the same kind of
endowment war chest, "will have to sweeten the packages in order to lure top
middle-class kids by taking money away from students who really need it:
low-income students. In that case, it would be bad." Of course,
most low-income students are educated at public colleges and universities. But
at a time when the United States is failing to keep pace with an increasingly
educated global workforce, the notion of narrowing any portal of access to
higher education for poor kids seems like a bad idea indeed. Policies catering to a low tuition in top universities may turn out to bring negative effect,