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Support graduates through tuition reform

BY DANIEL TAIBLESON | APRIL 25, 2012 6:30 AM

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While health care gets most of the attention as an inflationary juggernaut — climbing inexorably upward in spite of public outrage and economic turmoil — health-care inflation wilts when compared with tuition inflation. This has made the absence of any serious policy solutions conspicuous and a new proposal to tie tuition to student salaries after graduation all the more compelling.

An undergraduate education is no longer sufficient — simply attaining a college education no longer guarantees current students stable jobs and reliably middle-class lifestyles. Oddly, however, this does nothing to diminish the value of a college education: If anything, it has increased its value.

A college education has become increasingly necessary if one hopes to face favorable odds of obtaining economic security in the future.

Educational attainment has become increasingly tied to economic success: In 2011, a college graduate could expect to earn nearly double what a high-school graduate earned and was only half as likely to be unemployed. Perhaps more importantly, as income and educational mobility has declined, failing to obtain a college education increases the likelihood that one's children will not, either.

A recent effort to create some movement, the University of California-Riverside has proposed a rather compelling policy that offers a large number of benefits beyond the obvious.

The proposed policy by the UC students was this: Rather than collect tuition every year, students would instead pay colleges and universities 5 percent of their salaries after graduation for 20 years.

This accomplishes a number of things. First, it removes cost as a barrier to access to education. No one would ever have to forgo a college education because of exorbitant tuition and fees.

Second, it provides colleges an incentive to retain students. The more students who graduate, the higher their collective earning power — which means more revenue for colleges. On that note, it would provide a tremendous incentive for colleges to help students find employment right after graduation. The faster people get employed, the more colleges get paid.

Finally, it eliminates the entire student-debt issue.

This plan is not perfect. As it is currently laid out, it fails to address what happens if someone fails to graduate in four years or drops out before graduating. For this reason, I would suggest requiring that people pay a university 1 percent of their salaries per year they attended a college over a 20-year period. That means if students graduate in four years and earn an average of $50,000 a year, they would pay at total of $40,000. If students drop out after one year and earn an average of $30,000 over the years, they would pay $6,000.

Sadly, despite these widely acknowledged facts, universities and colleges as providers, students and parents as consumers, and the government and voters as stewards have done little to address higher education's single greatest barrier to access — rising tuition costs.

Since 1958, tuition inflation has greatly outpaced the growth in general consumer inflation. This past year, tuition inflation was 8.3 percent — more than double the general inflation. While that is a startling ratio, it is far from an outlier: Since 1985, tuition inflation has been no less than 1.23 and as much as 4.35 times higher than general inflation.

Yet, until now, no major push has been made to rein in what has proven to be the unstoppable upward drive in tuition costs.

If public colleges and universities were tied to the UC kind of payment model, many of the perverse incentives that currently exist in America's higher education system would be eliminated, and new, positive incentives would be created. Tuition inflation and debt need to be reined in. Costs should no longer prohibit anyone from attending college, and colleges need to do more to prepare students for employment — this payment model achieves all of these things.


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