College Costs

I understand, completely and sympathetically, the anger of graduating from college and owing over $35,000—the average debt of college graduates in 2013.  I understand the pain because, when I graduated from college, I also owed a great deal of money.  I owed a whopping 3,000.

I can hear the snickers now—three thousand bucks?  Seriously?  Nowadays that wouldn't buy you a decent meal plan at most schools.  True.  And the key term in the snickering response is "nowadays."

Let's do a little cost comparison.  I was actually fortunate in what I owed.  The College Board says that in 1974-75 the average debt of college students was just over $5,000.[1]  According to the US Dept. of Energy, in 1974, the year I graduated from college, the average cost of a new automobile was $4,524.[2]  That is about 11% less than the average college debt in 1974.  USA Today indicates that in 2013, the average cost of a new automobile was $31,252.[3]  That is about ten percent less than the average college debt.  The numbers are remarkably close, aren't they?  The average college debt in 1974 could buy you a new car; and average college debt in 2013 could do the same.

Another way of accounting for the debt I accrued in my college years takes me to the Bureau of Labor Statistics and its Inflation Calculator.[4]  Plugging in the average debt in 1974, it turns out that the equivalent in 2013 would be about $23,000.  So yes, the relative price of a college education has risen more quickly than the consumer price index, and has done so by a significant amount.  But not outrageously so.

The comparison of automobile costs in 1974 compared to 2013 might suggest why college costs have risen so much more quickly than the general CPI.  What does a modern car give you that a car, even the most advanced car, could not begin to give you in 1974?  Well, there's keyless entry.  There's tremendously better fuel economy.  There's automated, computerized systems.  There's built-in GPS.  There's . . . .  The technological sophistication that a 21^st century car provides make a modern automobile close to an entirely different object than a car from the 1970s.  The cost of a car in 2013, as out of whack with the general CPI as college debt, can easily be associated with all of those tremendous changes.

The same is true for a college education.  I know that people tend to focus on the eye candy that, no doubt, adds to the cost of colleges.  Do we really need the marble floors or the climbing wall or the three Olympic sized pools or the row after row after row of exercise machines?  Well, students seem to think so, and I will not reject their estimate.  But the eye candy is, relatively speaking, not that significant.  Much more important are the changes in technology.  My school has something like four or five hundred computers in laboratories, not to mention a computer on every employee's desk.  Those computers have to be refreshed regularly, on at most a three-year cycle.  By contrast, when I was in college, the university had a mainframe.  It had had the mainframe for several years.  It continued to have the mainframe for several more years.  And the computers are only the tip of the technological iceberg.  Colleges have to have an on-line presence, not only a web page but also the utilities and facilities that allow the school to function.  Even the cheapest course management software arrangement is not cheap, and the subscription is an annual budget item.  Server space is also not cheap.  The T-3 lines are not cheap.  All colleges have a department of information technology—IT Services—that employs a cadre of technologically savvy, expensive workers.  None of that existed in 1974.

On top of costs that had not existed in 1974, colleges are also bound to pay for resources that have outpaced the general CPI.  I will mention only the cost of energy.  The US Energy Information Administration has a Real Price Viewer that provides figures back to 1977.[5]  In 1977, the average price of a gallon of gasoline was $.59.  In 2013 the same gallon cost an average of $3.51, almost six times as much.  Oil cost $14.53 per barrel in 1977, but $99.63 in 2013—almost seven times as much.  Figures for 1979 show that the average cost of electricity per kilowatt hour was $.0464, and in 2013 $.1220, two and a half as much.  Only the cost of electricity traces the rise in the general CPI.  Colleges use electricity, obviously, but they run on oil and gasoline.

But then, people say, there are salaries for all of those expensive professors.  Faculty are blamed not only for being lazy, but also for being paid exceedingly well for that laziness.

It is almost impossible to provide an average figure for faculty salaries that means anything.  The Chronicle of Higher Education indicates that in the 2011-12 academic year, the "average" full professor at Harvard earned almost $200,000 per year, whereas the "average" full professor at Villa Maria College earned only $42,000.[6]  A different set of distinctions produces equally sharp differences.  In 2011, a professor of law earned an average of $134,000 whereas a professor of English earned an average of $80,000.[7]  My discipline is English, so I will restrict myself to general figures for that discipline.  In 1974-75, the Association of Departments of English indicates that the average salary for a professor of English was about $25,000.[8]  Given the figures from 2011 that The Chronicle of Higher Educations reports, then, salaries for people like me have just about tripled from 1975 to the present.  In other words, we have not kept up with the general CPI.

So why has the debt load of college students outpaced the general CPI?  The technological sophistication of the modern campus is a big reason for the greater increase.  I would add as well the unfortunate political reality that states have reduced appropriations for colleges and for education generally by a tremendous amount, so that students have had to put up more and more of the cost.  The problem, in other words, is almost entirely a matter of political will.

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[1] http://trends.collegeboard.org/sites/default/files/student-aid-2012-source-data_01122013.xls

[2] https://www1.eere.energy.gov/vehiclesandfuels/facts/2008_fotw520.html

[3] http://www.usatoday.com/story/money/cars/2013/09/04/record-price-new-car-august/2761341/

[4] http://www.bls.gov/data/inflation_calculator.htm

[5] http://www.eia.gov/forecasts/steo/realprices/

[6] http://chronicle.com/article/faculty-salaries-table-2012/131433

[7] http://chronicle.com/article/Average-Faculty-Salaries-by/126586/

[8] www.mla.org/adefl_bulletin_d_ade_43_50.pdf