jsupop33
Loyalty & Respect
One principal federal intervention in the higher education market stemming back more than a half century is the provision of student financial aid in the form of grants, loans and work-study funds, as well as service-related benefits such as the GI Bill and a range of tax-related benefits that help students pay the prices charged by a wide array of public, nonprofit, and, increasingly, for-profit institutions.
With recent large increases in Pell Grants and tax provisions, the federal government now spends roughly $100 billion annually in support of students in the form of non-repayable aid, tax breaks for students, and loan subsidies and default costs. This demand-driven strategy has certainly worked in stimulating enrollments far, far beyond what the private sector would have provided on its own. The unintended consequence of these federal policies, though, may be that prices and possibly the spending per student are far higher than they would have been in the absence of federal aid.
The other major federal role in higher education is support for university-based research, which now amounts to more than $50 billion annually and represents well more than half of what universities spend for research. The volume and variety of the theories, patents and discoveries produced with federal support of research conducted on campus make this undoubtedly one of the great public policy initiatives of the past half century. But there is also little doubt that the amount spent by universities on research-related activities is much more than what would have been spent if the federal government had not been involved, and has contributed to overall increases over time in spending per student, at least when it comes to the many universities whose faculties conduct that research. One culprit here is that the federal government, through the indirect cost system that governs federal research grants, reimburses universities for what they actually spend to administer research programs.
The synopsis above suggests that federal policies have contributed to rising prices, spending per student and debt burdens, and that it is thus appropriate for federal policy makers to consider how they might reduce the inflationary forces at work in the current system.
Read more: http://www.insidehighered.com/views...ing-college-prices-and-spending#ixzz1fgfg3OrE
Inside Higher Ed
With recent large increases in Pell Grants and tax provisions, the federal government now spends roughly $100 billion annually in support of students in the form of non-repayable aid, tax breaks for students, and loan subsidies and default costs. This demand-driven strategy has certainly worked in stimulating enrollments far, far beyond what the private sector would have provided on its own. The unintended consequence of these federal policies, though, may be that prices and possibly the spending per student are far higher than they would have been in the absence of federal aid.
The other major federal role in higher education is support for university-based research, which now amounts to more than $50 billion annually and represents well more than half of what universities spend for research. The volume and variety of the theories, patents and discoveries produced with federal support of research conducted on campus make this undoubtedly one of the great public policy initiatives of the past half century. But there is also little doubt that the amount spent by universities on research-related activities is much more than what would have been spent if the federal government had not been involved, and has contributed to overall increases over time in spending per student, at least when it comes to the many universities whose faculties conduct that research. One culprit here is that the federal government, through the indirect cost system that governs federal research grants, reimburses universities for what they actually spend to administer research programs.
The synopsis above suggests that federal policies have contributed to rising prices, spending per student and debt burdens, and that it is thus appropriate for federal policy makers to consider how they might reduce the inflationary forces at work in the current system.
Read more: http://www.insidehighered.com/views...ing-college-prices-and-spending#ixzz1fgfg3OrE
Inside Higher Ed