More on the Stumpjumper and College Costs

Yesterday saw a flurry of activity on the higher education bill. A bunch of independent colleges objected to HR 609 and Mr. McKeon did some last minute amendments and then issued a Dear Colleague letter that misrepresented their position against some key elements of the bill.

He offered an amendment that would PREVENT states from requiring institutions to use their accreditation services, should they choose to exercise the opportunity to create state based accrediting agencies. On the college cost issue he eliminated the role of the Inspector General in reviewing plans for colleges who exceed the College Affordability Index and reduced the number of institutions that would have to follow the guidelines and procedures from the top 25% to the top 10%. Both changes seem to have been in response to the criticism by opponents of the bill.

The change to prevent the states from requiring institutions to use their services is a welcome one. It reduces the opportunity for state bureaucrats to create a ministry of education in their state. The college cost changes seem to be a further indication that McKeon recognizes that the proposals may not be price controls but they are about as close to price controls as a proposal could be. They may even be a bit worse in that they will tend toward uniformity without offering consumers even the hope of changes in prices. (Which, by all experience price controls do not do anyway.)

The opponents of McKeon's measure have argued that it would be appropriate for the law to create a reliable and comparable disclosure mechanism. As the bill is presently drafted it requires colleges to follow a very specific set of procedures including setting up a special task force on campus and developing a plan to hold down costs. Conditions in the 3100+ institutions in the country vary. One independent college in California wrote McKeon of their efforts to build their program in new ways. This is a small faith based institution without a huge endowment. They have seen high single digit increases in their fees for the last couple of years and expect that trend to continue. Even with those increases they are still about in the middle of their comparison group. What have the fee increases bought? (In addition the institution has raised more money than at any time in their history - so all of this was not one fees.) Well, first, the program has become richer. They have added a new nursing program (there is a big shortage in nursing in the state) and some other offerings. Creating a high quality nursing program from scratch is not cheap. Second, they have grown their student body from about 800 to more than 3000 - that required new facilities. And like all independent colleges they added funding for student aid to assure that a wide range of students would have an opportunity to attend. The point is that their decisions about changes in pricing were not taken lightly or without a plan. But HR 609 assumes that the board and the administration took these decisions carelessly.

All of this suggests that there has been some movement on the issues important to independent colleges but that the sponsors of the bill still don't get the risks they are presenting. Bruce Bartlett in a recent book argued that a good part of the GOP majority seems to think that big government is OK as long as they control the levers of power. Big government is big government. In the area of higher education, the more the feds try to make us look like the European system of higher education where Ministries of Education control almost everything the more higher education in this country will lose the very distinctive flavor that has made it, according to the Economist and other international surveys, the best in the world.