Archive for Sunday, November 2, 2008

College crunch

Higher education faces a substantial period of financial problems the same as most other segments of our society.

November 2, 2008


Americans have a tendency to consider higher education operations fairly recession-proof. Locally, we see how Kansas University continues to operate year after year and take for granted that KU and all other schools will weather whatever economic challenges come their way. However, current economic conditions will pose some serious challenges.

The latest survey from the national College Board indicated there would be relatively modest increases in the tuition and fees for the 2008-09 academic year. Rates were expected to rise 1-3 percent above inflation - which at the time seemed fairly reasonable. However, such data was compiled before the past June and does not reflect the economic difficulties now at hand.

The bottom line, according to the agency, is that college students and families face sharp tuition hikes and declining financial aid because of a widening downturn in our economy. Enrollment figures for the coming spring and fall semesters will be quite revealing.

At Kansas University, the guaranteed four-year tuition locked in by freshmen for the last two years may start to look like a bargain. On the other hand, given the significant tuition increases by Kansas universities in the last decade, additional increases may result in enrollment declines.

According to a Washington Post article published in Thursday's Journal-World, "State governments struggling to balance budgets at a time of plummeting tax revenue are beginning to slash appropriations to post-secondary institutions. Private schools are also being squeezed as their endowments wither in the stock market and donors grow more cautious with their giving."

The article also quoted ACE president Molly Corbett on the trend. "I am concerned that we are entering a period - as we did following the recession of the late 1980s and early 1990s - when we will see a sharp spike in tuition prices at both public and private institutions," she said. "Presidents and boards of trustees are reluctant to increase tuition but they will likely have little choice."

At least 17 states already have announced funding cuts to their university systems, Broad says. State universities in Kansas have been told to prepare budget options that include funding reductions.

Colleges and universities, particularly the public ones, constantly are appealing to legislatures and private donors to provide more funding to meet growing needs. Even solid endowment programs such as that at Kansas University have seen their portfolios take alarming nosedives. The situation is not likely to improve for some time. Higher education is faced with a major belt-tightening period like most every other aspect of our financial structure.

KU and its colleagues may be more recession-proof than many parts of our society, but in times like these it, too, has to face up to a lengthening period of austerity.


Richard Heckler 7 years ago

All the more reason to stop spending $341,400,000(million)a day in Iraq. Education pays back. Illegal wars do not pay back. However a few weeks back it was noted in the news that education was not being hard hit. When economic woes surface, many times that is when people set forth to better their opportunities such as going for the bachelors,PHD's or doctorate degrees. Others look towards Vocational-Technical training. According to the news.Face it republicans are bankrupting the country with their reckless behavior. Why vote any republican into office at any level as they have adopted BUSHCO policies. Certainly party line republicans have not condemned republican fiscally irresponsible policies of the past 8 years. Instead the party in general has embraced "stay the course".The Bush gang's parting gift: a final, frantic looting of public wealthThe US bail-out amounts to a strings-free, public-funded windfall for big business. Welcome to no-risk capitalism popular Reaganomics theory among party line republicans at all levels has proved to be a dismal failure.

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