WSJ ?Falsely Blames Increased Government Aid For Rising Higher Education Costs
Posted in Main Blog (All Posts) on October 5th, 2011 4:42 am by HL
WSJ ?Falsely Blames Increased Government Aid For Rising Higher Education Costs
In a September 30 editorial, The Wall Street Journal suggested that the rapid rise in the cost of higher education stemmed in part from increased federal funding to the Pell Grant Program. However, experts have noted that federal Pell Grants have decreased as a percentage of tuition and are likely not a major factor in the increasing cost of higher education.
WSJ Suggests Federal Aid Is To Blame For Increasing Tuition Costs
WSJ: Universities Have Pocketed “Subsidies By Increasing Tuition After Every Expansion Of Federal Support.” In a September 30 editorial, The Wall Street Journal criticized proposed increases in the federal Pell Grant Program , claiming it will not have “anything to do with making it easier to afford college.” From The Wall Street Journal:
To preserve Team Obama’s priority of maintaining a maximum Pell grant of $5,550 per year and doubling the total annual funding to $36 billion since President Obama took office, Democrats recently decided to make student-loan borrowers pay interest on their loans for their first six months out of college. Washington used to give the youngsters an interest-free grace period. Taxpayers might cheer this change if the money wasn’t simply being transferred to another form of education subsidy. But it seems almost certain to raise default rates as it puts recent grads under increased financial pressure.
None of these programs has anything to do with making it easier to afford college. Universities have been efficient in pocketing the subsidies by increasing tuition after every expansion of federal support. That’s why education is a rare industry where prices have risen even faster than health-care costs. [The Wall Street Journal,
[New America Foundation, 7/12/11]
