Sunday, August 10, 2014

Two Conflicting Ideas at the Same Time

Wise and worldly readers, in a passing comment this weekend, I realized that I believe two conflicting ideas at the same time.  I’m hoping you can help me figure this one out.

Idea One is that the “high tuition, high aid” model doesn’t work.  Students are scared off by the high sticker price, and simply don’t apply.  

Idea Two is that students are unduly impressed by “scholarships” that are actually discounts off an artificially high sticker price.  That’s why they’ll choose a forty thousand dollar tuition with a twelve thousand dollar “presidential scholarship” over a ten thousand dollar tuition with no scholarship.

At different moments, I have believed -- and professed -- both of these.  But I’m having a hard time believing both at the same time.  If “high tuition, high aid” didn’t work, then students wouldn’t go for high discounting.  But they do.

Of course, it might be possible to believe both ideas if they didn’t really conflict.  If, say, the definition of “students” in each idea were different, then it would be possible for both to be true.  For example, the “students” in Idea One would be low-income and/or first generation students, especially in the context of community colleges.  The “students” in Idea Two could be the sons and daughters of the upper middle class applying to private four-year colleges.  If that’s the difference, then it’s entirely possible for both to be true.  Students who are new to higher education may be intimidated or scared off by high sticker prices, whereas students whose families went to college may not be.  

That explanation seems to work at first blush, though it falls apart somewhat when applied to for-profits.  For-profits focus(ed) largely on first-generation and low-income students, but at considerably higher tuition that most publics, and with little discounting.  Here I’ll draw on Tressie McMillan Cottom’s insight that many for-profits structure(d) their costs with an acute awareness of the psychological difference between the money a student has to come up with now and the money she’ll have to repay later.  They backloaded, creating an initially low barrier to entry.  In other words, while the for-profits may have been much more expensive than most publics, they got good at hiding the fact.  The exception may not be an exception.

If this is all basically true, and the division between Idea One and Idea Two is the social class of the students involved, then we’re looking at continuing economic polarization among sectors.  The sectors that draw upon the (relatively) affluent can compete on amenities, using discounting from a wildly high sticker price to fill the class as they see fit.  Meanwhile, community colleges -- whose budgets are increasingly tuition-driven -- are locked into low costs and a self-perpetuating cycle of austerity.  

This is not good.

I think it’s Stein’s Law that says that anything unsustainable won’t be sustained, and the “discounting” approach is showing signs of unsustainability among some of the private colleges.  At some point, the market will bear only what it will bear; if you’re in a region with a declining number of 18 year olds and relatively flat incomes, and your endowment is finite, you can only paper over the gap for so long.  Eventually, something has to give.  

Or maybe it’s simpler than all this.  Maybe Idea One is right and Idea Two wrong, or vice versa.

Wise and worldly readers, are One and Two mutually exclusive?  Or is there a way of reconciling them other than what I’ve offered here?