#1 Reason for the Price of College: Supply & Demand

Remember the concepts you learned in your first economics class? GDP, unemployment rates, pricing etc. It turns out, one of those concepts are the very reason for the price of college today. According to Pascal-Emmanuel Gobry from Forbes.com, the reason for the high price of college is actually painfully obvious. He says that if you increase the want or need for something without increasing the amount you have, then the price will go up in a free market. Prices are signals in a capitalistic market economy. When a price is high, it is either more of a luxury good or it is a highly sought after good. Most people do not believe that college is a luxury item so that means that college is very valuable to people. They are willing to pay very high prices to obtain degrees. Because of this willingness and the easy access to tens of thousands of dollars in financial aid from the government, demand for college increased dramatically in the past 30 years. And, not coincidentally, prices sky rocketed too.

Financial Aid loans were meant to help more people get into college and create a more educated workforce. Do these loans really increase the price of college overall? Gobry gives the example that “US colleges that don’t accept Federal loans have tuition roughly half of their similarly-ranked peers.” For colleges that do not accept federal loans from students, the prices are almost half as much as the other colleges. Inflation in tuition for those colleges are substantially less. Even if you are an ardent supporter of higher education in this country, will you support these loans no matter how high prices climb?


Why We Support PHEAA Middle Income College Grants

CSCubed is preparing for AICUP Student Lobby Day in Harrisburg on April 1. Our primary goal is to convince legislators to commit funding to a new PHEAA grant program that helps middle class students pay for college. Leading up to Lobby Day we’ll be providing more information as to why this new grant program is so important.

AICUP research provides the following information:


The middle class is hit hardest by student debt because they are not wealthy enough to pay for education out of pocket and not poor enough to qualify for programs like Pell Grants. Consequently the new middle income PHEAA grants that CSCubed supports will help a population that has the most student loan debt of any income category.

Welcome to Accepted Students!

Hello to all the parents and prospective students on campus today for Accepted Students Day! Please take a minute to look through the information we provide concerning how to keep the costs of higher education manageable. We provide regular updates on issue related to college so please enter your email and you’ll be notified when we add a new post.

Please also follow us on Twitter @CSC_Cubed and on Facebook (https://www.facebook.com/CSCCubed).

Higher Ed Money for the Middle Class

by Kyle Purchase

The issue with higher education is the humongous debt that follows after a student finishes school. In some cases student worry not just about the debt but how to raise money to even complete their education. Thomas Hundley, a political science major at Howard University, has been raising money at his law firm where he works to continue his chance of completion. What he hopes is that President Obama can aid middle-class families like Hundley’s and many other families across the nation.  CSCubed’s cause for debt relief of middle class families would also include getting more students  to enroll and succeed, rather than stop school and raising enough money to complete. Helping middle income student finance education, rather than having them potentially drop out to work to pay for future schools would help the cause of higher education.


Bill Aims to Eliminate Upfront College Costs

by Elizabeth Cohen

A bill introduced in Washington’s legislature proposes that students do not have to worry about paying their college tuition right away. Rather, after leaving school, they would pay a percentage of their income for up to a 25 year period. The “Pay It Forward” program can help a wide variety of people with different incomes afford college.  17 other states have introduced similar legislation. However critics of this program believe we should stick to the programs that already exist, like grants, and add money to those instead of trying to fund brand new programs. Still there are good points listed in the bill such as if a person’s income changes then the amount they pay per month would change as well. This bill would bring many changes to a student’s ability to pay for a college education.


Higher Education: On A Crash Course For Reinvention

by Ameer Sorrell

As parents begin to prepare children for college they start to worry about how much it is going to cost. Another problem they encounter is where their child will attend an affordable school. Colleges and Universities are becoming more aware of how high their sticker price is. Congress could help by making some policy changes.  An article in the Huffington Post states that if institutions were responsible for 25% of the student loans received by their students.  If this were to happen, three things would have to be addressed. The selectivity of students trying to attend college, students leaving college unprepared for what life is really about, and parents not taking advantage of the opportunities to lower cost as much as possible through internet sources. If you think about it, its not possible because that means we would have to start from the beginning and force people to want to make changes socially and culturally as well as using the sources given to us. Parents have to be involved in wanting to lower the cost of college. College gives young people hope to want to be something in life, but if we as adults don’t focus and stay committed to trying to get youth into school at lower prices then this problem will always be a debate. College costs are only going to get worse unless we put forth the effort to make a difference.

College Costs for Middle Income Students

by Christopher Howard

Richard Perez-Pena of the NY Times writes that the average private college student pays about 57 percent of the sticker price. Additionally, colleges with the higher sticker price are the ones that tend to give out the most financial aid. These facts particularly affect people who have somewhat above average incomes. These people do not qualify for need-based aid and are not able to pay out of pocket either. They are in the middle pack and are the ones that are really being affected by college tuition costs. According to Perez-Pena, a federal government study stated that families in the second highest quartile in earnings had a net cost percentage rise by eight percent since 2004, which is more than the people in the first quartile. This is disconcerting news for parents and students that fall into that middle quartile. They are the ones taking in the brunt of the debt and it is going to be hard for them to pay off all of their future loans. This not only affects them but their children and grandchildren causing a domino effect.

College Costs Out of Control

by Emily Bonney

In an article from Forbes Magazine, contributor Steve Odland provides some cold, hard numbers concerning the rising costs of college. Odland reminds readers that a there is a correlation between the amount of education a person has received and their average income. People without any college education earn almost $18,000 a year less than the US average wage, and less than half of what someone with a four year degree makes. While it is said that everyone has the same opportunities to receive this education, it is obviously not the case. Only 17% of the US population has earned an undergraduate degree, but the costs of college may change this in the future. Accounting for inflation, Odland states that while the consumer price index has risen 115%, but college education inflation rate has risen nearly 500% since 1985. Even with government aid, private funding, and scholarships, many students in today’s education system still have to take out loans which accrue interest. Odland attributes this rise in costs to the tenure policies, and the rise in spending on administration for the institutions rather than on professors or other capital expansions that would benefit the colleges.

The Burden of Higher Education

by Carly Wray

Today, one out of four students with loans cannot afford to pay them back. According to the Consumer Financial Protection Bureau, about 25% of graduates are in default with their college loans. The issue with these loans is there is no guarantee for financial prosperity and a way to pay for them out of college. Higher education does not have the same value as it once did in the economic world. The job market is weak and the average student owes more than their annual income straight out of college with an entry level position. However, Georgetown University’s Center on Education and the Workforce states that a bachelor’s degree pay is higher than a high school graduate’s by 84 percent. In this case, the price of college needs to be reasonable and it is not.