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Monday, December 16, 2013

“Best Values” in education

So we’ve come to this. You can charge $13,000 (in-state) for a year’s tuition and get labeled a “best value”.  $40,000 out of state.

My graduate alma mater is a fine place, but

 

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To put these numbers in perspective, consider the average wealth (net worth) of American households. Here’s a table from http://www.nasdaq.com/article/americans-have-relatively-poor-net-wealth-cm257517 , which conveniently provides international comparisons.

http://econintersect.com/wordpress/wp-content/uploads/2013/07/z-temp3.png

About a third of US households have very little wealth (<$10,000). Another third have less than $100,000, meaning their wealth would be wiped out by two kids and in-state tuition.

But, you say, what about that financial aid? Well, loans are financial aid, but as we are increasingly seeing, the loan payback is a drag on young people for years, particularly if they are spending their 20s in underemployment hoping the economy improves.

So I find the notion that UM would be called a “best value” depressing.