U.s. College Tuition Increasing Beyond Affordability 

Ethical Dimension

Due to a lack of state and government funding in higher education, colleges in the United States naturally increase tuition to make up for the decline in financial support. However, increasing tuition puts many students in a difficult position, in which they must choose between taking on student loan debt to afford a college degree or struggling to find a job without one, since “by 2020, 65 percent of [jobs] will require postsecondary education and training beyond high school”, in contrast to only “36 percent of [jobs] that will not require education beyond high school” (Carnevale et al., 2013). A college degree not only increases the likelihood of finding a job, but also an employee’s earning potential in the short-term and long-term. Graduates who obtained a bachelor’s degree generally “earn 66 percent more than those with only a high school diploma” and “over the course of a lifetime . . . [they] will earn approximately $1 million more than” an individual who did not attend college (“College Affordability and Completion”). With these benefits of having a college education in mind, students enroll in colleges in hopes of improving their socioeconomic status, even though they would have to rely on student loans to pay for tuition. The U.S. government can play a major role in addressing the issue of student loan debt, but it has chosen to prioritize the military budget without considering the long-term, harmful effects of students taking on student loan debt in order to afford a college education.

For most young people, a degree is the means to getting their dream job. Unfortunately, it is difficult to complete a degree due to the cost, which is “why nearly half the students who begin college in this country [do not] finish within six years” (“College Affordability and Completion”). Students who take out loans and drop out because of financial issues will still owe debt, but now with the additional struggle of finding a sufficient paying job without a four-year degree. The common range that students borrow is $20,000 to $40,000, which the U.S. Department of Education reported would usually take 20 years to repay; the minimum debt range of $0 to $7,500 would take 10 years to repay and debt of $60,000 or more would take 30 years (“The Standard Repayment Plan”). As a result, even some students who graduate also acquire debt that they will carry for at least a decade, which impacts their ability to buy a home, since they cannot afford it with high interest rates. Student loans set many behind for the future and put their plans on hold. With affordable tuition, obtaining a degree would not be limited to only people of higher income households, more people will become more educated, and the country will prosper.

Since it generally takes 20 years for the average borrower to repay his or her student loans, many students have to put their lives on hold in order to pay off their debts. According to the American Association of State Colleges and Universities, many students’ major life “milestones such as buying a car, owning a home, getting married” are often put off due to student debt (“Student Debt Burden”, 2006). Student loans may have helped students pay for their college tuition in the short-term, but it puts a long-term financial burden on many college graduates. In a Forbes Article, former student Sean Vaillancourt shares his personal experience of “waiting to have children and buy a home because our combined student debt is more than a mortgage on a home” (Hembree, 2018). Increasing government funding for colleges and universities could reduce the pressure on students to delay significant life milestones because of debt, in addition to decreasing the cost of college tuition and increasing access to higher education.

Another consequence of students taking on student loan debt is that they have to forego riskier career choices that may have brought more fulfillment and greater potential for career progression in the long-term. Instead, individuals may choose to join a “more stable company instead of [a] startup with bigger growth opportunities” to ensure that they can pay off their student loans (Caldwell). In addition, student loan payments also make it more difficult for graduates to change their career. Borrowers may have to disregard opportunities that involve relocating because of financial issues, since there may be moving expenses involved or lost wages between changing jobs. Young adults should be able to take these risks in life that would help them gain more experience and pursue a career they truly enjoy. For students who carry the burden of large student loan payments, increasing government funding to make college tuition more affordable can help these students acquire higher education and give them more freedom to take risks to get their dream job.

Legal Dimension

In the United States, one of the most significant factors some students must consider when deciding if they will attend college, is that when they walk out of an institution of higher education, an extensive student loan will accompany them. Unlike any other type of loan, a federal loan will never go away. Colleges and universities are supported financially by the federal and state governments, whose contributions have the greatest effect on the price of tuition. To illustrate, “[t]he New England Policy Center assessed state budget cuts in the New England region and found that when other factors are held constant, every dollar of reduced state funding led to a 17 cent increase in net tuition and fees at public four-year institutions. The effect is even greater for community colleges which have a stronger reliance on state funding – for every dollar lost in state funding, community colleges cut institutional expenditures by 56 cents, according to the study” (Zhao, 2019, as cited in Mendelson, 2020). While this study was conducted in the New England region, the findings show a correlation between government cuts in funding for higher education and increasing tuition, a trend that has become more prevalent across the country.

The effects of decreased funding on colleges and universities include increased prices for tuition and fewer students wanting to seek higher education. To combat this problem, the government must invest in higher education to make public colleges and universities in the United States affordable and world-class. As tuition rises across the nation, financial aid fails to cover tuition and other college expenses as it once did. It is essential that the government reallocates the nation’s budget to once more make college affordable and accessible.

In the United States, before the federal or state government carries out a legal reorganization of its budget, a formal procedure must take place, in which the president proposes a new budget plan for the upcoming year that must be approved by Congress. This is also known as a budget resolution; once this stage of the process has been completed, the budget plan will become part of the official budget and be ready for implementation in the upcoming year.

Financial Dimension

Tuition has increased faster than inflation, which makes students have to spend an amount twice their income to afford a college education. Based on the Bureau of Labor Statistics consumer price index, “today’s prices in 2020 are 329.50% higher than prices since 1977” (“Inflation Rate”). The underlying cause of why students are overcharged is because state and government financing to colleges has decreased significantly. In “1980, states provided 46 percent of the operating support for public colleges and universities. By 2005, that amount had fallen to 27 percent” (Facts about Higher Education Financing). Now that the states and government are only providing about a quarter of the funding, students are expected to make up for that in tuition prices. Colleges get funded by multiple sources, such as tuition, grants, the state, and endowments, so how they receive their budget is not the issue. On the other hand, students face two major problems: the cost is increasing and they are forced to pay more. A plausible solution to the issue of colleges overcharging students would be to have the state and federal government invest more into college education, which would decrease tuition prices for students.

With the responsibility of financially supporting colleges transferred to students, some students struggle to pay for college tuition without the help of student loans. However, relying on student loans to afford a college education creates the problem of student loan debt, which has impacted numerous students’ major life choices after college. In fact, “44.7 million” Americans have student loan debt, which makes it “the second largest slice of household debt [of $1.68 trillion in 2020] after mortgages, [greater] than credit card debt” (Bustamante, 2020; Looney et al., 2020). Data from the 2016 Survey of Consumer Finances compared the percentage of households with outstanding student loans over the years, noting that in 2016 “40 percent owe more than $25,000 and 21 percent owe more than $50,000” which is greater than in 2007, before the Great Recession, when “32 percent of borrowers had over $25,000 in debt, and only 13% of borrowers had over $50,000 in debt” (Frost, 2019). If the current state of affairs remains unaddressed, these numbers will continue to rise on an upward trend.

Every year, the federal government has an annual budget to spend on national expenses. According to The Federal Budget and Economy, “federal spending totaled $4.4 trillion in 2019” and 30 percent of that budget consisted of discretionary expenses. The categories that fall under discretionary expenses would be military spending, education, public transportation, income security, health, and other. Out of the 30 percent, which is $132 billion, 50.6 percent is used to fund the national defense while only 7.1 percent goes to education, which would be $9.372 billion. Based on this data, it is clear that the federal government invests the most money into national defense. If the federal government could take some of the percentage funded towards the national defense and use it for education instead, then it would help address the national student loan debt and students being forced to pay overpriced tuition to obtain a degree. This would allow more students to have access to a college education and be able to afford tuition without relying so heavily on loans. As more jobs today require a degree, the federal government plays a key role in making college more affordable.

Conclusion

Despite the high costs of obtaining a college degree, students perceive this credential as an investment for their future; specifically, an opportunity to move up the socioeconomic ladder into the middle class. Students will have greater difficulty in finding a job without one, making it a necessity for economic security. As discussed earlier, the root of the problem lies within declining state and government funding in higher education, so the first step to addressing student loan debt would be to persuade policymakers to consider college education as an essential expenditure and maintain sufficient long-term support for education, rather than a target for cuts in the event of an economic recession (Hiltonsmith, 2015). Reallocating the funds for military defense to higher education would restore state and government funding for colleges and universities and as a result, reduce the cost of college tuition and student loan debt without burdening taxpayers.

Works Cited

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14. “The Standard Repayment Plan Is the Basic Repayment Plan for Loans from the William D. Ford Federal Direct Loan (Direct Loan) Program and Federal Family Education Loan (FFEL) Program.” Federal Student Aid, U.S. Department of Education, studentaid.gov/manage-loans/repayment/plans/standard.