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Money pits
Ten years ago, seventeen American colleges and universities boasted endowments of one billion dollars or more. Today, there are forty-seven such schools, thanks to smart investing, active fundraising, and friendly tax laws. Harvard is of course the richest school in the country, with an endowment of $22 billion; Yale follows at a distant second wtih $10 billion. Other schools on this elite list include Boston College ($1.15 billion), Wellesley College ($1.18 billion), and Purdue University ($1.21 billion). Together, the forty-seven richest schools in the country possess nearly two-thirds of all the endowed wealth in American higher education. Combined, they educate less than 4% of American undergraduates.
You might think that such enormous institutional wealth might translate into stable--even economical--tuition scales, that the colleges and universities with the most resources might work to ensure that their doors really are open to all, no matter what their financial situation. But you would be wrong. The money goes into building facilities, expanding bureaucracy (especially paying presidents, whose pay has gone up 79% over the last ten years), recruiting and retaining star faculty, and, of course, into acquiring more money. If, on average, the richest schools in the country have tripled their wealth over the last decade, they have also doubled their tuition. In 2004, the average cost of an education at a private billionaire school was $29,002; the average cost of an education at a public one $7,230 per year. These schools are pretty good about financial aid, meeting nearly 98% of "demonstrated need" through loans and grants, but students attending them graduate with a lot of debt--those who take out loans accumulate an average of $16,000 in debt.
These are just a few of the facts collected by the Associated Press, which set out to collect information about higher education finances in order to study the problem of why the richest schools cost so much to attend, even as they keep getting richer. Well worth a look.
Posted by acta online on May 25, 2005 at May 25, 2005 08:16 AM