NCPA - National Center for Policy Analysis

Government Intervention Leads to Higher Tuition Costs

September 18, 2014

By the time students graduating college with a bachelor's degree are looking to join the workforce, 60 percent of them will have already accumulated more than $26,000 in student loan debt. This debt, writes Lindsey Burke of the Heritage Foundation, is a direct result of federal intervention in higher education.

The 2013-2014 academic year saw federal student aid reach $169 billion, and the government's Pell Grant program, which provides aid to 9 million students, is the largest piece of the federal education budget. Because more students have access to more federal dollars, Burke explains, universities and colleges are raising their tuition prices. In fact, college tuition has grown at twice the rate of inflation for the last three decades.  

While lawmakers have introduced various efforts to ease the burden of student loan repayment, nobody is addressing the real issue: rising tuition prices. How to tackle higher education costs? Burke offers reforms:

  • Reform the Pell Grant program. The program was intended to serve low-income students. To that end, Congress should set an income cap on eligibility and give Congress more oversight on program funding from year to year.
  • Make higher education more flexible. Currently, federal higher education financing is tied to accreditation, which prevents new and innovative educators from entering the higher education market.
  • Halt plans to regulate for-profit and vocational schools. The administration plans to issue a rule that would prevent students in for-profit schools from accessing student loans if those schools have high rates of student loan default, a move which would limit students' ability to access different educational options.

Policymakers, contends Burke, must minimize government intervention in higher education if they ultimately want to reduce the student loan burden for millions of college graduates.

Source: Lindsey Burke, "4 Key Reforms That Could Make College More Affordable," Daily Signal, September 15, 2014.


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