Neoliberalism and Student Debt: The High cost of Ideology

Beth Mintz

University of Vermont

Paper presented at the annual meeting of the Eastern Sociological Society, New York, 2015.

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 Abstract

A number of factors have contributed to the crisis in student indebtedness that has become

visible in the wake of the great recession, including the long term transformation in the funding

of higher education in the United States. This paper argues that neoliberalism can explain many

of the processes leading to our changing commitment to colleges and universities and the cost

increases that this has produced. It suggests that a number of neoliberal assumptions firmly

rooted in conventional wisdom have contributed to a “student as customer” phenomenon which

is itself, a cost driver. We use the development of this “customer” as a vehicle for exploring

tuition increases. To do so, we examine the tension between education as a public and a private

good and the marketization of higher education, as crucial drivers of these transformations. In

doing so, we emphasize that the “student as customer” has been created by the changes in the

way that we think about, organize, and fund education, rather than any fundamental change in

young people.

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Neoliberalism and Student Debt: The High cost of Ideology

Part of this increased cost [of a college education] is associated

with the perverse assumption that students are ‘customers’, that
the customer is always right, and what he or she demands must
be purchased. Money is well-spent on psychological counselling,
but the number of offices that focus on student activities,
athletics and athletic facilities, summer job placement and
outsourced dining services, to say nothing of the dormitory
rooms and suites that only the Four Seasons can match, leads to
an expansion of administrators and increased cost of
administration.1

Exchanging pleasantries with a barista at Starbucks one afternoon, I learned that the

young woman behind the counter was a college student having a great day. When I asked what

made it so good, she told me that her classes had been cancelled. At risk of harkening back to a

golden age of student engagement that never really existed, perplexed faculty around campuses

these days are trying to understand what has happened to undergraduates. Particularly

mystifying is the emergence of the student as customer, a result, they speculate, of popular

culture or, perhaps, contemporary child rearing patterns with their emphasis on self-esteem.

Student orientation to higher education has changed dramatically for recent generations,

but this transformation is rooted in the way that we think about, organize, and fund education,

rather than any fundamental change in young people. This article uses the “student as customer”

as a vehicle for examining some of the processes that have contributed to the high debt loads that

students carry. It suggests that due to changes in our view of education as a private rather than a

public good, the ways that colleges and universities are funded these days, and the

“marketization” of higher education, students today are customers and this has contributed to

tuition increases. It argues that a set of neoliberal assumptions that have become firmly rooted in

conventional wisdom have driven public policy that has contributed to the rise of the student as

customer.

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 Beginning with a brief discussion of the rise of neoliberalism, it examines the tension

between education as a public or a private good, exploring how the victory of the latter has

contributed to the rise of education as consumerism. It then explores some of the ways in which

treating higher education as a market has created the “student as customer” phenomenon and

how this has contributed to the cost of higher education.

The Neoliberal Sensibility

The workers of tomorrow will be able to recycle

themselves at their own expense during their free time.2

It is not clear exactly when liberalism died in the popular imagination, but the death knoll

was plainly heard when, in the 1988 presidential race, Michael Dukakis was attacked as a

spendthrift liberal. Seven years of the Reagan presidency helped solidify the ascendance of the

subsequent paradigm, neoliberalism, with its emphasis on the efficiency of the free market, the

need for deregulation and privatization, reduction of government spending on social services,

and individual responsibility replacing the concept of a “public good”.3

David Harvey suggests that the roots of the new liberalism preceded the Reagan era,

however, having gained academic legitimacy in the United States in the 1970s when the

neoliberal economists, Friedrich Hayek and Milton Friedman, won the Nobel Prize.4 By 1979, it

had become economic orthodoxy; by the mid1990s, it was clearly enshrined even among

democrats as illustrated by President Clinton’s health care reform proposal featuring market

competition and personal responsibility. It was also the cornerstone of the (George W.) Bush

administration.5

Neoliberalism equates state success with its ability to nurture and sustain the economy.6

Absent from the discourse is any discussion of liberalism’s long-held concern with the

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contradiction between the right to pursue profits in a capitalist economic system and the ideal of

equal opportunity in a democratic society. Central to traditional liberal philosophy, then, is

economic freedom, but this goes hand in hand with an understanding that unbridled property

rights produce inequality: some profit at the expense of others. The solution offered in the liberal

tradition is a strong government to supervise the economy and public support for the poor and

disadvantaged, who have not had an equal opportunity to compete in profit making. Today more

than ever, the distain for liberalism includes the belief that government cannot effectively

provide for the needs of its citizens; it also sees public support for the disadvantaged as

antithetical to the ethos of personal responsibility.

Neoliberalism’s emphasis on the role of the state in facilitating economic expansion is

not new. Governments have long sought policies that would encourage economic growth,

provide jobs for its citizens, and prevent the worst features of cyclical recessions and

depressions. Post World War II fiscal policy in the industrialized world pursued these goals via

a strategy of government intervention in market processes through increased regulation and

government direction of economic activity. Following the Keynesian model, government

spending compensated for shortages in consumption and private investment and, thus, deficit

spending was used successfully as a stabilizing strategy.

These policies brought economic recovery in the 1950s and affluence in the 1960s. The

1970s, however, witnessed the return of high unemployment and inflation and an end to the

belief in Keynesianism as an effective mechanism for maintaining economic health. Replaced by

the neoliberal assumptions emphasizing the efficiency of the free market and the corresponding

need for deregulation and privatization of much of the public sector, trust in the market was en

route to becoming conventional wisdom. So too was the commitment to tax reduction,

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abandoning the welfare state, and replacing the notion of the public good with the personal

responsibility for one’s own welfare that helped frame President Clinton’s health care proposal

mentioned above.

Over time, neoliberal ideas and practices have increasingly have structured our economic

and political lives, and this shift has had profound implications for social arrangements of

varying stripes. As Political Scientist Wendy Brown argues, neoliberalism frames all human and

organizational action as entrepreneurial, while developing institutional rewards and practices for

facilitating this.7

Surely included in this ideology is the university, where neoliberal policies frame a

college education as both a financial investment for the student and a vehicle for serving the

needs and demands of the business community.8 It also assumes that colleges and universities

should compete for students as customers in a marketplace and they should produce highly

trained workers, who will enable the nation to compete successfully in a global arena.

The introduction of market logic into higher education has not made it efficient however,

but instead has contributed to the runaway costs that we see today. Of particular interest here is

how neoliberalism has solidified the rise of “student as customer” with its attendant costs and

consequences.

The Student as Customer: Public versus Private Goods

Our nation is at risk. Our once unchallenged

preeminence in commerce, industry, science, and
technological innovation is being overtaken by
competitors throughout the world9

Most Americans these days accept the importance of economic development as a strategy

for maintaining U.S. competiveness in the global market and, theoretically at least, many believe

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that our nation’s future depends on the availability of an educated workforce. This frames most

discussions about the direction of the American educational system. It was articulated by the

very prestigious National Academies of Science, which called for a comprehensive federal effort

to strengthen the nation's commitment to long-term basic research10 and it is captured in state and

federal policy discussions about the future of schooling. President Obama summarized this well,

when he suggested that we have a responsibility, “to invest in the skills and education of our

young people. If we expect companies to do business and hire in America, America needs a pool

of trained, talented workers that can out-compete anybody in the world.”11

History confirms that education is an engine of economic success. Harvard Professors

Claudia Goldin and Lawrence Katz note that, “the twentieth century was both the American

century and the Human Capital Century,” suggesting that the remarkable strides made during

that period were the payoff for investing in universal education.12

Underpinning these messages about the importance of school, then, is the assumption that

it is something that will “raise all ships.” More generally, our ideas about the funding of

education turn on whether we consider it a public good; that is, whether we believe that the

whole community benefits from an educated population. Traditionally, this included the notion

that an educated citizenry is crucial for maintaining a democratic society and this, some argue, is

why it is so important to maintain the place of the humanities in today’s curriculum. But this

seems to be a relic of days gone by. Also out of style is the idea that the collective skills and

knowledge of a population is a “public good” that can serve the community in a variety of ways,

as is any robust discussion of school as a vehicle for upward mobility for low income students.

Today, education is considered a public good when it is viewed as the economic driver discussed

above, particularly when its task is to train future workers to fill necessary market positions.

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 Job preparation and vocational training have long had a place in the American

educational system but, in the contemporary world, vocational training has taken center stage.

For K-12, this was evident in the No Child Left Behind Act of 2001 (NCLB), which privileged

marketable skills over broad educational outcomes, and it remains the central theme in much of

the discourse about schooling in the United States. And with this, the neoliberal vision of the

educational system, “as production facilities whose primary mission was providing industry with

its required human capital”13 has become conventional wisdom.

In higher education, “training for ‘employability’”14 is front and center, with community

colleges in the forefront, as their primary mission of preparing students to enter bachelor-degree

programs has been replaced by a charge of job training.15 In four year colleges and universities,

its salience is reflected in the popularity of marketable majors like business administration and

computer science and in the funding of STEM at the expense of the humanities.

Thus, traditional views of schooling as a public good have narrowed over time from an

emphasis on the role of an educated citizenry in maintaining a democracy, as a resource

benefitting the collectivity, or a vehicle for equal opportunity, to an economic driver

emphasizing job training. But even this limited frame of education in the interest of the wider

public competes with the ever more popular notion of education as a private good, something

pursued by the individual as an investment that will yield a return in the form of future earnings.

In the language of the economist, these investments are a form of capital, human capital

in particular, but in this reading, the profits are to be enjoyed by the individual, rather than the

community and, so, in the world of the private good, individual aspirations and achievement are

front and center. Although the potential for individual gain has driven the expansion of the

American educational system for 150 years, in the last few decades, education as a private good

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and its neoliberal corollary of individual responsibility and individual consequences have

increasingly framed the discourse of educational policy.16

The ascendance of this view has had a profound impact on the financing of education in

the United States, in general, and in higher education, in particular. With its assumption that

those who benefit directly from an investment are those who should pay, the belief in education

as a private good helps explain the privileging of loans over grants, and the systematic defunding

of public colleges and universities that we are experiencing. And it has had enormous

implications for access to higher education.

Theorists have long argued that schools reproduce the class system,17 but the victory of

the neoliberal agenda has intensified the role of education in solidifying advantage. It has

institutionalized the gap in access to higher education in new ways, as more and more low and

middle income students are either priced out of the academy, or trade down in terms of status and

prestige. This is consistent with David Harvey’s understanding that increasing social inequality

is so central to neoliberalism that it can be viewed as structural or, as Henry Giroux suggests, by

defining the public good as private, neoliberal ideology “produces, legitimates, and exacerbates”

poverty and disparity.18

Although many of the processes institutionalizing inequality within higher education

preceded neoliberalism -- the class advantage in SATs scores and the excellent precollege

educations that money can buy, for example --different now is that the emphasis on personal

responsibility and the application of market principles to the nonprofit sector that has contributed

to the public defunding of higher education; this translates into the structural requirement of

privileging the privileged, since institutions now survive on those who can pay the bills.

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 For colleges and universities, the need to attract high performing students who can

manage a good part of their tuition becomes imperative. Educational scholars Sheila Slaughter

and Gary Rhoades argue that, “Precisely because tuition revenues are an increasingly significant

share of institutional revenues, colleges and universities move to attract consumers who have

more money and seek to extract as much revenue as possible from them.”19 “American colleges

and universities,” they continue, “have become like airlines and hotels, practicing ‘yield

management’ to try to maximize the revenue generated by every seat or bed.”20 And the less

affluent middle class student with access to student loan monies, too, is an attractive target for

these seats and beds.21

The solidification of education as a private good helps to explain an assortment of other

types of policies and decisions that seem so antithetical to society’s needs. To counter some of

the cuts in its state appropriation to its colleges and universities, Iowa, for example, recently

announced double digit tuition hikes for those pursuing more expensive majors. Nursing

students, particularly hard hit by this, faced a 41.1% increase in costs22 amid a nursing shortage

of crisis proportion. Soon after, over half of flagship public universities had instituted some

form of differential rate structure,23 although this trend now seems to be taking a different turn.

To help encourage students to pursue majors needed by industry, a Florida task force

recommended reduced tuition for those studying subjects with high job-market demand.24 This

is an interesting return to education as a public good, and it also gets to the heart of educational

policy in a neoliberal era: amid the revolt against public financing of private gain, and

overwhelming faith in market rule, this proposes subsidizing business needs. One of the many

contradictions of neoliberalism, then, is that when an economic agenda clashes with ideology,

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the economic often wins. David Harvey argues persuasively that neoliberalism is a political

project, and this would explain the myriad contradictions in the political realm.25

Stanford Professor David Labaree suggests that education as a private good, with its ever

increasing emphasis on school as a vehicle for individual social mobility, also has a profound

effect on student behavior and this is the result of.26 Unlike the model of knowledge acquisition,

we often think about education these days as a commodity to be used for competitive advantage

in the labor market. This has contributed to the ongoing differentiation between elite and non-

elite schools, fueling the intense competition for access to the most selective colleges and

universities, and reflecting the high stakes game of maximizing individual educational advantage

in an era of “credential inflation.”27 And with this, a college degree becomes something to be

purchased for individual gain; the aim is no longer the skills and knowledge of traditional human

capital theory, but the job that the credential buys. In the same way, the goal of the affluent

pressure cooker suburban high school of today is less intrinsic intellectual development than

access to the Ivy League with its promise of a distinguished future.

When the primary goal of education is a vehicle for a credential, the most rational

students figure out how little they can do to earn their degree. Pulitzer Prize winning Harvard

Professor Louis Menand captures this nicely when he notes that in a society encouraging young

people to maximize personal advantage, there is little incentive for broad intellectual

development; when given a choice, in this context, people will learn only what they need for

occupational success.28

College students are, of course, very diverse and the designation of college includes a

wide assortment of institutions. In general, however, empirical evidence suggests that the

contemporary college student spends less time on academics than previous generations, and this

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is consistent with the idea of student as customer, purchasing a degree. New York University

sociologists Richard Arum and Josipa Roksa point out that in the early 1960s, students spent an

average of forty hours a week – a typical work week – studying and attending classes, but they

found that only half of college seniors today, including those from more selective institutions,

spend a comparable amount of time on academics.29 Evidence also suggests that in some

traditional-style residential colleges, friendships and social learning are more important to

students than academics.30

This de-emphasis on the scholastic is consistent with the view of education as a

commodity; for many students, the credential has replaced the goal of learning and exploration.

Some argue that our colleges and universities are complicit in this, as they require less of

students and reward them for their presence via grade inflation.

The introduction of market logic into higher education has not made it lean and mean.

Instead, neoliberalism has solidified the rise of student as customer and I will explore the

attendant consequences and costs of this below. Importantly, any notion of higher education as a

public good that remains salient today is organized around workforce development, and the

tension between the public and private good plays out as a contradiction between business’

interest in the training of workers to be subsidized by public monies, on the one hand, and the

ideology that emphasizes higher education as a vehicle for differentiation and credentialism for

personal gain, on the other.

The ascendance of education as a private good helps explain why we are transferring the

cost of higher education from the community to the individual: this ideological shift has been

used to justify its massive underfunding.31 But since all income growth in recent years has gone

to the top 20 percent of the population (a proxy for the college educated), the fear of falling

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sends more and more students to college, independent of the cost, institutionalizing the private

funding of a public good. And this emphasis on the need to pursue higher education to enjoy a

middle class life is itself an ideological coup. As Bob Meister suggests, we now understand this

“education premium,” rather than capitalism, as the primary source of inequality.32

In summarizing how the student as customer emerged, the first part of the answer is that

education is broadly understood to be a private good; as an investment with an anticipated

monetary return. At this particular historical moment, the private has captured central stage as

suggested by the neoliberal emphasis on personal responsibility. As Randy Martin writes,

“people are, through their own actions, to become the masters of their own destinies. There is

still room aboard the ship of success, if one only prepares oneself adequately for the passage.”33

The debt accumulated for this preparation is quite large and among the many things that are lost

are the value of a broad education with to its attendant role in sustaining a democracy, any real

commitment to equal opportunity, and the notion that education is about knowledge and

learning.

Student as Customer: The Role of the Market

Those truckloads of glossy brochures that high school students receive from colleges and

universities these days are only the tip of the iceberg in what institutions of higher learning spend

on marketing these days. Some argue that this is efficient; given imperfect information, it is

necessary to match consumers with providers.34 But when tuition dollars form the foundation of

university revenues, the game changes profoundly.

Marketing is part of the larger process of marketization-- the increasing influence of

competition and market logic on university cost structures --35 and one of the ironies of the

student loan crisis is that this marketization is an important cost driver. Indeed, competition has

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had a profound effect on colleges and universities, and many believe that it plays a major role in

rising costs.36

Higher education is not really a market, at least in the formal sense; it is highly regulated

and highly subsidized. Nevertheless, The United States is the most market-oriented system of

higher education in the world.37 Here, traditional colleges and universities compete for students,

faculty, administrators, research dollars, donations, and endowments, and each of which

contributes to cost pressures; private for-profit institutions join the mix mainly targeting students

with access to Pell grants and/or government subsidized loans. A number of factors have led to

the highly competitive situation that we now encounter, and the rise of the student as customer

provides a particularly interesting vehicle for examining this development. Financial aid is an

important case in point.

In the early days of financial aid, federal government monies took the form of grants and

subsidized loans, distributed to individual colleges and universities for each to allocate to their

students. This was not necessarily income based, but included a variety of programs designed to

meet national educational goals.38 The early 1970s brought resolution to a long-term debate

over whether government sponsored funding should continue to be institutionally based; that is,

whether to maintain the practice of providing monies to colleges and universities to be

distributed to their students, or given directly to the recipient, to take where they enroll.39

Transportability by the student won out and this became the foundation for federal financial aid

policies that we see today.40 Ironically, given the consequences detailed below, the idea of equal

opportunity drove the decision; the promise that all needy, qualified students would have a

standardized aid package and, in those days, this came in the form of grants.41

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 Fast forward to the 1990s and the ideological shift embodied in neoliberalism is

apparent, when loans replaced grants in federal financial aid policy in a rhetoric of personal

responsibility wedded to an understanding of education as a private good. Not surprisingly,

transportability remained, perhaps because it fit so well with the assumption that competition

from the informed choices of students would bring market forces to bear on tuition costs, thus

increasing efficiency and quality. But the market did not function in quite that way. Indeed, a

few short years later we see the beginning of a profound shift in campus life that is by now quite

familiar. Currently referred to as the amenities wars, consider this description,

For decades the design trend in college dormitories could be summed

up in one word: cheap…. But in recent years that trend has reversed
itself, led by cash-rich universities in search of a competitive
advantage. At the head of this class is Boston University, which is now
building a superdorm at a cost of $100,000 per student, double the
national average. The glass-and-steel tower looks less like a rooming
house than a sleek yuppie condo, with sweeping views of the Charles
River and the Boston skyline. All bedrooms are private, sharing
carpeted suites and genuine kitchens -- adult-size fridges, built-in
microwaves, garbage disposals, the works.42

Indeed, B. U’s luxurious high-rise dorms were on the cutting edge of contemporary

campus living, soon normalized as other institutions followed. New York University, for

example, quickly followed with a building spree including a $95 million, 16-story dorm, the

third in a series that the New York Times described as lavish, complete with a state of the art

health club, a dance studio with a maple suspension floor, a pool, a gymnasium, a juice bar and a

$100,000, two-and-a-half-story, climbing wall.43

To attract students, college and universities have followed these leads, trying to keep

competitive in the market for enrollments. Today, this is no longer confined to the wealthiest

private institutions, but is a necessary part of campus life. As the Delta Cost Project notes that

these facilities bring students to campus. Moreover, they “are vital parts of institutional

15
marketing, and recruitment strategies and facilities investments play a role in students’

enrollment decisions….”44 In recent years, campus recreational facilities have been joined by a

more general building spree designed to attract students, with less than half of new campus

construction taking the form of fancy dining halls and new residential complexes.

These facilities are expensive and are they are typically funded through long-term

borrowing in the form of bond issues. In 2009, the 220 public colleges and universities rated by

Moody’s collectively carried over $100.9 billion in outstanding loans. Since 2005, median debt

increased by 31%, outpacing both student enrollments and revenues growth.45 The privates, too,

have increased their borrowing: between Fiscal Years 2004 and 2008, with direct debt growing

by 41%.46 These loans have to be repaid, of course, and debt servicing has become a standard

line in the typical university budget.

As of May, 2012, for example, The University of Colorado carried approximately $1.92

billion in outstanding debt; this means that 6.1% of its annual operating budget went to debt

servicing. Bond rating agencies consider this a moderate debt ratio and prudent financial

practice, even though the university will pay $128.9 million in 2013 in interest charges,47 enough

to fund a part of the enormous amount of deferred maintenance on the typical university campus.

Many of the privates are in similar positions. In recent years, George Washington

University spent about 10.4% of its operating budget or about $60 million for debt payments

annually.48 And ironically, Harvard, the wealthiest university in the country, carries more debt

than any of the other campus, at about $6 billion.

The price of the bricks and mortar explosion on contemporary college campuses is far

from trivial as 10.4% of an operating budget suggests, and a different type of amenity -- student

services – adds to overall costs. These include a wide assortment of offices and departments.

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Universities distinguish between costs directly related to: instruction (e.g. faculty salaries and

benefits and academic department administration); academic support (e.g. libraries, academic

computing, Dean’s offices); student services (e.g. career counseling, admissions, intramural

athletics); plant and equipment; etc. Over the last few decades, instructional spending as a

percentage of total expenses has declined in both the public and private (non-profit) sectors and

in 2012, it accounted for between 27 and 33% of university budgets, depending on the type of

institution.49

Student services, on the other hand, are growing and these features matter. Today,

students expect all sorts of services, and these have become a game changer as competition for

tuition payers has increased. Those attending colleges with more amenities and services rate the

quality of life at their institutions much higher than those at places that spend less.50

Defined narrowly, about 19% of spending in private bachelor’s granting institutions, for

example, is on student services, up 16% since 2000.51 Using a broader measure including

student services and auxiliary enterprises such as residence halls, food services, student health

services and the like (but not debt servicing,) some schools spend as much as $.90 for every

dollar in instructional costs on these extras.52 Schools targeting high achieving students invest

less in these services, while campuses with a less academically inclined population maximize

life-style enhancements.

These services are not wasted; students use and enjoy what is available. For less

selective institutions, this spending may increase graduation and retention rates,53 although the

impact on learning has not been measured. Those campuses trying to raise academic quality may

find themselves in a double bind, however since increasing spending on instruction at the

expense of these features may harm enrollment.54 Precisely when higher education is under

17
increasing scrutiny for academic value added, then, very expensive amenities, including student

services and auxiliary enterprises are necessary components of many a college campus.

Economists Robert Archibald and David Feldman argue persuasively that the cost of

highly educated labor, rather than amenities, drives college costs; this is not contradictory, since

the growth in student services – no matter how defined – is accompanied by additional personnel

to administer these programs.55 Although many, including faculty, look at high-level executive

compensation to explain the high cost of a college education, it is the hires that report to the

highly compensated, that is most taxing.56

Expanding the scope of amenities from the obligatory climbing wall to include student

services broadly conceived, it is clear that student choice has developed into a competition – and

a very expensive one – for tuition monies and the marketization of admissions has not increased

efficiency. Instead, it has created a student as customer who selects among some very attractive

enticements, which do not necessarily speak to academic quality or intellectual development.

One irony, then, is that student choice and market efficiency have led to the very

expensive amenities and services races on campuses throughout the country that continue to

drive up tuition.57 A second irony is that students are borrowing ever increasing amounts to

attend universities with ever increasing sticker prices, which are themselves saddled with ever

increasing debt loads, to attract their incoming classes.

The Student as Customer: Market Forces and The Drive for Prestige

Within this status-conscious world of higher education, high

tuition may not be a deterrent but an attraction, since it
advertises the exclusivity and high standing of the institution.58

Princeton, Harvard, and Yale, numbers one, two, and three respectively, in U.S. News

and World Report’s 2015 rankings of national universities. Williams takes top billing among

18
liberal arts colleges, with Amherst and Swarthmore not far behind. The competition among

institutions for place in the rankings is intense, and both students (and parents) and colleges and

universities take the results very, very seriously. Indeed, the stakes are extremely high for both

groups.

Among upper middle class families, prestige has become the centerpiece of college

aspirations. Some suggest that since evaluating the quality of the education at a particular place

is so difficult, prestige plays a signaling function for the student, substituting for concrete

measures of quality and value.59 This may be so, but in the contemporary world, the value of

prestige is best understood in terms of differentiation and credentialing. When education is

viewed as a vehicle for competitive advantage in a labor market – as a private good – and

attending a prestigious college or university is believed to distinguish one from the large pool of

college educated competitors, it is seen as a good investment. In this situation, students pursue

prestige as a rational strategy for investment maximization. And, of course, this is why the

competition for place is so very intense.

For colleges and universities, rankings reflect a drive for prestige that has become a

central part of many an institutional strategy. Often, it is the competition for tuition dollars, in

particular, that is behind the attention that schools pay to the U. S New and World Report lists.

And since it is clear that rankings are a very important arbiter of college desirability, vying for

position is a logical strategy. But the pursuit of prestige contributes to the increasing cost of a

college education; so much so that some have called it “a positional arms race”.60

Colleges seek outstanding students because peers are often viewed as an important part

of the learning process. But they also target the strongest students that they can attract as a

vehicle for maintaining or increasing their prestige rankings, and this can play out in very

19
expensive ways. For example, acceptance rate -- the ratio of admitted students to total

applications – contributes to an institution’s U.S. News and World Report rank and this helps

explain why high school students find so many of those glossy brochures in their mailboxes.

They help bring in a class, but they also assist in maximizing the number of applications the

institution receives. Cornell, for example, sends out over 110,000 recruitment packets every year,

recently generating about 18,000 applications, for an 18% acceptance rate and a U.S News

ranking of 25.61 Little information is available on total recruitment costs, but figures from 1996

for a select set of prestigious private institutions in a less heated time put it about $1700 per

student for universities and $2500 for colleges62.

For the most highly ranked, there is no shortage of willing attendees, although

competition for the very best and brightest remains intense, given that selectivity accounts for

12.5% of an institution’s U.S. News and World Report ranking. This probably explains why one

year, an Associate Dean of Admissions at Princeton was caught hacking into Yale’s confidential

on-line admissions system.63 But maintaining one’s position, even for the most selective

schools, is particularly important because the system is self-reinforcing: perceived quality

generates prestige levels. This is apparent in the U.S. News and World Report rankings, where

undergraduate academic reputation accounts for fully 22.5% of an institution’s total score.64

Indeed, that which is seen as prestigious generates high rankings on the prestige scale,

reinforcing an institution’s position in the academic hierarchy.

For the many less selective colleges and universities in the country, climbing the

rankings ladder is a vehicle for increasing prestige and, thus, increasing attractiveness to those

most able to pay the bill. Tuchman suggests that the “prestige seeking” institution is an

important development in the landscape of higher education.65

20
 Attentive institutions have figured out ways to game the system. If a college seems to

have a number of courses with a 19 student enrollment cap, for example, it is probably not driven

by room size. Rather, the proportion of classes with less than 20 students is another measure

used by U.S. News and World Report. But the way markets work, once everyone learns this

trick, it no longer differentiates among institutions. And colleges today have adopted an

assortment of practices – some much more expensive than decreasing the size of their smallest

classes – that have become much too widespread to be effective.

Some of these practices are part of a number of sophisticated recruitment strategies that

colleges and universities have developed in recent years with the very telling name of enrollment

management. And one very common -- and expensive -- device for attracting high achieving

customers is playing off tuition and financial aid. And here, too, now that everyone is doing it,

this has become a very expensive enterprise.

The tuition rates that are posted in college guides and on the websites of institutions of

higher learning are sticker prices, but as in the auto business, not everyone pays full price. When

discounts are included, average increases in tuition levels have been much more modest than the

formal record indicates: recent estimates suggest that the actual price paid for college tuition in

the 2013-2014 academic year averaged around 60% of the published figure66 and, apparently,

over two thirds of full-time students receive at least some subsidy67.

Indeed, in recent years, colleges and universities have become major sources of financial

aid to undergraduates. Termed institutional grants in the jargon of academia, this is best

understood as tuition discounting and it explains why the average price of attendance is so much

less than the sticker suggests. This practice can cover a large part of the tuition costs for the

most attractive students, but it has become enormously expensive for higher education.

21
Currently, about 39% of all grant funding comes directly from individual schools, an amount

almost equal to the 40% covered by all federal government sources.68 In dollars, colleges and

universities’ share was estimated to be about $48.2 billion, for the 2013-2014 academic year, up

from $25.2 billion (dollar adjusted) in 2003-2004, for an increase of over 90%.69

Figure 1 compares the growth of institutional grants, tuition increases, and state funding

of higher education over a ten year period. What is most striking is the extent to which tuition

increases pale in comparison to discounting. This becomes quite clear when real prices are

considered: in the Fall of 2013, the sticker price (tuition and fees) at a four year public college or

university averaged $9062, but dropped to $2950 after tuition discounts. For privates, although

the published price for four year schools was $30,731, the actual price averaged out at $11,860.70

Figure 1. Tuition Discounting, State Funding, Average

Tuition. 2003/04-2013/14
60
50
Tuition Discounting (Billions)
2013 Dollars

40
State Funding/FTE (thousands)
30 Average Tuition (thousands)***
20
10
0
Years

This means that to the extent that the outcry about price increases in higher education

revolves around sticker price, it is overstating the problem, since relatively few pay full freight.

Among private institutions, for example, the inflation adjusted increase in net tuition revenues

grew by 1.7% in 2012, demonstrating that a large part of tuition increases have been returned to

undergraduates in the form of institutional grants.71 And although the average net price paid by

22
in-state students at four year public colleges and universities increased recently, this followed an

overall decrease in net payments over time. For this sector, institutional aid has been the fastest

growing expenditure during the past decade.72

But students are paying. For public colleges and universities, tuition increases help

replace the funds cut by state governments as they continue to disinvest in their higher education

systems as illustrated in Figure 1. For students, this means that tuition is increasing, even though

moderated by institutional contributions, while resources are shrinking, leading to larger classes,

fewer program choices, more adjunct faculty, and enormous amounts of deferred maintenance.

And, of course, this is exacerbated by the yearly debt servicing costs of the construction boom.

For the wealthier privates, investment continues, ranging from cutting edge facilities to

innovative programs and, for some, aggressive recruiting of academic stars. But for both sectors,

the goal is to pay the bills by maximizing the number of students who pay full freight, and to do

this, schools strive to maintain (or increase) their position in the cutthroat world of academia;

with this, the drive for prestige remains intense in both the public and the private sectors. And

this has played out in enormous sums expended on merit money.

In today’s world of high sticker price tuition, merit has replaced need as the predominant

form of institutional aid. Available data suggests that about 38% of all institutional grant monies

in public four-year schools goes to financial need, while in the privates, it is half,73 while grant

size tends to increase with income levels.74

This pattern is relatively new: in the early 1990’s, the financial aid provided directly by

colleges and universities was responsive to both need and merit, but in more recent years

attention to academic achievement has ballooned.75 Originally envisioned as a mechanism to

attract students in an increasingly competitive market and to reward hard work in the context of

23
declining scholastic attainment, merit money has developed into a strategy for increasing

prestige.76 As Orr notes, the function of institutional grants has changed over time, “from

supporting traditional goals of access and choice to recruiting students and maximizing

institutional revenues.”77 The drive for selectivity as a vehicle for increasing prestige has

institutionalized tuition discounting as a strategy for recruiting high achieving customers, which

helps colleges and universities compete in the rankings game. Indeed, as economist Amanda

Griffin found, at least for the privates, merit awards tend to increase when SAT scores are not

keeping pace with peer institutions, and when a school finds their U.S. News and World Report

ranking slipping.78

Merit-based aid, although pervasive, is not without controversy. Early critics cautioned

against its expansion, arguing that any short-term advantage would quickly disappear as the

competition adopted similar practices and that it would favor wealthy students at the expense of

those in need.79 As predicted, increasing merit aid has not necessarily been a winning bet. The

most recent data available on the privates is old but indicate that as of 2005, the strategy had not

turned into an effective vehicle for maximizing revenue: for most of the schools examined, merit

aid was accompanied by increased net costs, and although it helped them remain competitive in

recruiting high achieving students, the gains were fairly modest.80

Since that time, the total bill for institutional grants has almost doubled, stretching the

resources of all but the wealthiest schools, in a trend captured in the title of a Chronicle of

Higher Education story: “Rising Tuition Discounts and Flat Tuition Revenues Squeeze Colleges

Even Harder.”81 Moreover, merit money is less important in decisions about attending more

selective institutions, suggesting that this type of aid might be most effective in recruiting lower

income high achievers who would have gone to a more prestigious place, if they could afford it.82

24
 In the public sector, although tuition discounting is a revenue enhancer when used

modestly, available data suggests that a majority of four year institutions were at risk of losing

income due to their discounting practices.83 Recent work has also examined the role of merit

awards in graduate admissions finding that for one elite university, at least, increasing the size of

a scholarship did not affect the probability of the enrolling the most academically accomplished

applicants84 while other research has demonstrated that merit money is not an effective way to

boost retention.85

The drive for selectivity as a vehicle for increasing a school’s prestige, then, has

institutionalized merit money in the form of tuition discounting as a strategy for recruiting

customers. But as more and more institutions compete in this way, tuition discounting is still

another thing that schools must do in order to remain competitive and the more typical it has

become as a practice, the less effective it can be in differentiating among schools. Indeed, now

that everyone is doing it, it has become a very expensive enterprise. To cover this, many

colleges and universities have been forced to raise their tuition, shifting costs to less attractive

students in a process akin to cost-shifting in health care, where help for one segment of the

population is transferred to others in the form of higher prices. In this way, using merit aid to

increase total revenue by increasing enrollments has contributed greatly to the escalation in

tuition costs more generally.

In recent years, merit aid has come to play a dual role in public universities, particularly

in flagships, as many have turned to recruiting out-of-state students to counter decreases in state

funding. While enrolling high achieving students contributes to a school’s prestige as measured

by national rankings, for the publics, non-resident students also present an opportunity to

increase total revenues since they typically pay much higher tuition rates than in-staters. A

25
number of studies have demonstrated that the enrollment decisions of nonresident student are

highly sensitive to institutional grant offers and the publics have responded to this: for the 2011-

12 academic year, institutional financial aid for out-of-state students at public research

universities averaged $6,843 (compared to $2,160 for residents) but even with this increased

discount, net tuition revenue received from those from out-of-state was about three times more

than from state residents.86

Given this differential, high tuition/high aid strategies seem to make sense in this context

and so it is not surprising that merit money is used to aid the recruiting effort. But, here again,

once everyone has incorporated merit-based financial aid into their recruitment strategies, it

becomes less effective in differentiating among institutions. Preliminary research has found that

this approach may actually lower tuition revenue,87 suggesting that state universities have

become particularly vulnerable to the market failure of merit grants.

At the same time, it is clear, as early critics warned, merit money privileges the wealthy;

the academic scholarships that have grown at the expense of need-based aid goes predominately

to upper income students88 and award amounts tend to increase with income levels.89 Families in

the bottom 20% of the income distribution receive only about $400 more, on average, than those

in the highest quintile.90 This means that students least likely to get merit money come from

populations which have been traditionally underrepresented in higher education91 and although

this is associated with a decrease in the proportion of both low income and African American

undergraduates in more selective colleges and universities,92 it is hitting public sector schools

especially hard.93 The potential impact of this – and other – practices on stratification within the

academy is profound and evidence suggests that early fears about the expansion of merit aid

26
seem to be playing out as predicted in a process underscoring David Harvey’s point that

neoliberalism and increasing inequality go hand in hand.94

The Student as Customer: The Growth of Honors Programs

For anyone who hasn’t been on a college campus in a number of years, a change they

might notice is the proliferation of programs designed especially for high-achieving students.

Data on the exact number of schools with these offerings are not readily available, but in the

early 2000s, nearly half of all public 4 year colleges and universities, and about 11% of privates,

had developed some type of honors program, many of which had been established since 1989.95

Currently 890 institutions belong to the National Collegiate Honors Council, the professional

association of undergraduate honors programs, and this includes public four-year institutions,

private universities, small liberal arts colleges and an assortment of community colleges.96 But

they are most common in large, competitive or very competitive, research institutions97.

Honors Programs at major universities are typically advertised as cost-effective

alternatives to elite schools. Often characterized by enriched classes, better facilities, and

enhanced student services, honors programs are part of contemporary enrollment management

strategies targeting the most accomplished high school seniors, and institutional patterns of

growth suggest that they have developed as a mechanism for attracting high ability students. 98 In

this way, they are best viewed as part of a larger strategy – that includes the shift from need-

based to merit-based financial aid -- that has overtaken higher ed in recent years, targeting those

students most likely to increase a school’s prestige. Indeed, as Lynne Goodstein and Patricia

Szarek suggest, honors programs are particularly promising, since they focus on students with

academic records that help bolster the institution’s position in the national rankings.99

27
 Systematic data on the cost of honors programs are not available, although it is clear that

institutional investment varies greatly. The University of Vermont, for example, inaugurated its

Honors College in 2006, opening with the completion of a new $35 million residential living

complex. The complex – including its debt servicing – is designed to be financially self-

sufficient; that is, the cost of construction is borne entirely by the students who live there. The

university, for its part, spends about $900,000 directly on the college, most of which goes to

administrative salaries. Out of a total operating budget of 500 million dollars or so, this is a

very modest amount, although in an era of scant resources and large lectures, it would buy eight

or ten additional faculty lines. Other costs include staffing small classes, special programs and

activities, academic mentoring, and thesis advising, and these begin to add up. The thirty

sophomore honors classes a year, each with a maximum capacity of 20, for example, takes six or

so full-time faculty to teach.

Western Carolina University boasts a slightly more ambitious program.  Housed in a new

$51 million residential facility and supported by a dean and a full-time staff of three, they

increased the number of honors students from 77 to 1,326 over a 15 year period, while raising

their admissions standards and boosting the program budget by nearly 600%. And underscoring

the importance of the program to the school’s economic health, they note that even with the

financial difficulties that the university has faced in recent years, there has been no mention of

reducing its size or cost100.

And then there is the University of Massachusetts’ recently expanded Commonwealth

Honors College, enrolling 3380 students, and housed in its new $177 million residential and

teaching complex, with a description on its webpage that could be boilerplate for honors

programs more generally. Consider: “You will enrich your studies with small, intensive classes

28
where you’ll develop enduring ties with faculty members. You’ll be challenged in an engaging

array of interdisciplinary seminars and courses in your field as well as have opportunities to

participate in Community Service Learning honors courses.”101

These examples illustrate that Honors programs are part of the landscape of higher

education, particularly in institutions that are not of the highest selectivity but are reaching for

students with impressive credentials. Three questions are particularly relevant here:do honors

programs serve their students well; who is admitted; and are they cost effective in their role as a

recruitment strategy.

Surprisingly, given the many schools that have invested substantial effort and resources

in their development, the effectiveness of these programs has not been addressed in as much

detail as one might expect. Available data, however, present a mixed portrait of their success.

From an academic standpoint, students in honors programs increase their acquisition of

scholastic capital more than their non-honors peers,102 although one particularly influential study

found that by the end of their first year, gains in cognitive abilities were modest.103 And we

know little about progress after that initial experience. A larger body of work has looked at

retention: only between 19%104 and 35%105 of students remain in honors programs them for their

entire undergraduate careers. Other studies have found they are no more likely than non-honors

students to graduate106 or to remain in their college or university, after the first year.107

These results suggest that honors programs are less impressive than the hype surrounding

them, although this varies by institutional type. Not surprisingly, given their selection criteria,

these programs tend to exclude low income and minority students.108 Indeed, honors students are

typically white, come from high income families, with fathers who disproportionately have

graduate degrees.109 But honors programs have flourished in less selective institutions, and it is

29
here where they seem to work well as an educational vehicle: they provide high achieving, low

income students with heightened academic skills and, therefore, they have the potential to be

effective vehicles for social mobility.110 It is important to note, though, that given differences in

cultural capital, low income students, are less likely than wealthier kids to convert their academic

achievement into future gains.111

In spite of their limitations, honors programs in schools of low selectivity may serve as a

vehicle for decreasing stratification between institutions,112 but, more generally, they create

stratification within schools. In more selective places, they sort students by SES, enrolling kids

who are generally more elite than their non-honor peers.113 Indeed, available research suggests

that honors courses are often taken by status-conscious students interested in distinguishing

themselves from the larger field by acquiring the additional cultural capital that these programs

promise.114 And in this way, they have developed into mechanisms attracting high status

enrollees. They also reflect the pattern of stratification in higher ed more generally: access is

most open in schools of lower selectivity and most gated in more selective places. And the

advantages of participation are similarly stratified.115

Whether they are financially successful is more difficult to evaluate, given the goal of

recruiting students who will increase the school’s prestige ranking, in the hope of attracting

additional students able to pay the bill. Some work has found that about half of first-year

students enrolling in honors programs would have gone elsewhere were it not for this

opportunity,116 suggesting that it does help recruit those coveted high achieving students. And

about three quarters of honors students report that merit money was important in their decision to

attend a particular place, suggesting that these funds might be well spent, although some research

has found that the exact amount was less important than the offer of aid in itself.117

30
 But, in the same way that the drive for prestige has institutionalized tuition discounting

as a requirement of doing business, honors programs are destined to become too widespread to

remain effective recruiting mechanisms; here too, when everyone is doing it, it simply becomes

another necessity without a financial payback. And given the data on its academic success,

many schools would probably have been better off investing in scholastic initiatives targeting

increased learning for all.

In this paper, I have argued that a particular set of neoliberal assumptions including, a

belief in personal responsibility, an overriding faith in the market, the need for the privatization

of public services, and a view of education as job training, have become firmly rooted in

conventional wisdom and these have contributed to the rise of the “student as customer” with its

attendant costs. The contemporary narrative of education as a private good has solidified this

image of students, and it helps explain why we are transferring the cost of higher education from

the community to the individual, while its neoliberal corollary of personal responsibility has

provided the ideological shift justifying its massive underfunding.118

Given neoliberalism’s belief in the power of the market, the non-profit world has

increasingly been subject to the rules and processes that drive the private sector119 and colleges

and universities have responded to this with a series of institutional practices designed to help

them survive marketization and privatization. The organizational imperative to attract students

who are able to pay the bills explains a number of the strategies that have been widely adopted,

including many designed to aid in the drive for prestige. But too many of the practices that were

created to distinguish a school from the competition have been so widely adopted that they have

lost their edge and in this way, instead of providing advantage in the competition for revenue,

they have become very expensive necessities. This includes the campus building boom, the

31
growth of student services, the pervasive tuition discounting that is paralyzing any number of

schools, and even the relatively inexpensive honors college.

The impact of these trends on students is real, both in terms of cost, and on who gets to

go where. These practices contribute to the high debt loads that students carry and they affect

the class and race/ethnic composition of higher education, generally. But they are especially

consequential in those places where prices have escalated most dramatically, that is in what

Sociologists Dan Clawson and Max Page describe as the quintessential residential college, where

students with backpacks stroll on the quad.120

Archibald and Feldman suggest that the upscale residential facilities on many of these

campuses are consistent with the general upgrading of U.S. housing stock; in this way they

reflect the life styles of contemporary students, many of whom might be willing to pay for such

improvements.121 Sociologists Elizabeth Armstrong and Laura Hamilton provide a different way

of understanding this when they argue that many schools organize the college experience in ways

that systematically advantage the affluent.122 This paper suggests that the need to target those

most able to pay the bills also structures the recruitment efforts of four year colleges and

university in ways that privilege the affluent and, in doing so, raises costs for all students.

In the example of luxurious dorms, this includes those who might prefer more modest

accommodations when weighed against future debt. It also speaks to merit money, used liberally

in the contemporary world of academia to recruit high achieving students as part of the larger

strategy to maximize revenue. But available data demonstrate that those characteristics defined

as meritorious are both class-based and racialized and this is why merit aid and need-based aid

tend to be mutually exclusive. It also explains why the high tuition/high aid approach to

maximizing tuition dollars has led to a decrease in African American and low income students in

32
four year colleges and universities. And the need to remain competitive with student services

and designer programs like honors colleges follows a similar same dynamic.

These processes play out in any number of additional ways on college campuses. The

economic costs of recruiting a student body that might help raise an institution’s rank in the U. S.

News and World Report’s listings, for example, are real, but this competition is not limited to

students. Colleges and universities compete for reputation with their faculty and with their

research dollars, each of which contributes to the overall cost of the education that they provide.

But not all of the market forces borrowed from the corporate world are prestige or

reputation based. In trying to understand why tuition is so very high, many turn to executive

salaries; following the lead of the corporate sector, high-level administrator compensation has

skyrocketed. Indeed, presidential salaries are reaching record highs as colleges and universities

continue to raise tuition and cut positions. The Chronicle of Higher Education reports the typical

public college president earned about $428,000 in 2014, not including the cars, housing, meals,

etc. that come with the job, up seven percent from the year before.123 Penn State’s president

topped the list at $1.5 million. But these pale when compared to the high earners of private

colleges and universities where the highest paid a few years back weighed in at over $7 million

in total compensation, with 36 others topping the one million dollar mark.124

The proverbial golden parachute is a variation on the same theme. Penn State’s

President, fired amid a child-abuse scandal, left with a separation package of about $2.9 million

dollars,125 dwarfing the example of an outgoing president at Rutgers University that made a

splash in academic circles a few years back who was slated to join the faculty as a history

professor, with a salary of $320,000 a year. These figures, of course, do not include (highly) paid

sabbaticals to retool to teach, light workloads, or lifetime tenure.

33
 Surely, top salaries pale in comparison to the giants of industry. And in the scheme of

things, although symbolic, relatively few administrators earn these lofty incomes and so they

account for a very small proportion of an institution’s costs. Nevertheless, the reason that these

packages are so out of line with faculty compensation is unclear, although one Washington

lawyer specializing in presidential contracts argues that golden parachutes and large

administrative salaries are often needed to attract qualified candidates.126 One can debate

whether or not this is true, but the striking feature of these packages is the market-based

discourse surrounding them; the orthodoxy of the market as the arbiter of academic decision

making.

As Patrick Calla, president of the National Center for Public Policy and Higher

Education notes, however, executive compensation packages reflect, “a set of values that is not

the way most American’s think of higher education.”127 Indeed, outrage about the high cost of a

college degree more generally is quite visible, especially among middle-class families and, at

this writing, Presidential hopefuls are crafting campaign messages calling for reform. However,

to the extent that neoliberal assumptions frame the way Americans think about education – and

their world, more generally -- meaningful change will remain elusive.

Over the years, we have developed a neoliberal sensitivity; that is, some of the major

tenets of neoliberalism have become conventional wisdom and many, many of us see the world

through this lens. This obscures many of the consequences of neoliberalism including the role of

the market in the cost escalation within higher education, the limitations of organizing an

educational system around workforce development, and the problem with undervaluing a broad

education and not understanding its role in sustaining a democracy; equal opportunity is also an

increasingly hard sell.

34
 This article has examined some of the institutional practices that have developed in

response to the broader neoliberal agenda of marketization and privatization. As I have

suggested, the impact on students is real, both on their pocketbooks and on their view of the

educational enterprise. And when compared it to the conventional wisdom of trust the market,

the conclusion is very different: corporatization and marketization are important drivers in tuition

cost escalation.

35
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40
41
1
Cole 2010
2
Hirtt 2000 p. 13 quoted in Levidow 2002
3
Greenwood 2009
4
Harvey 2005
5
Aronowitz 2004
6
Brown 2003
7
Ibid
8
Saltmarsh 2011
9
National Commission on Excellence in Education, 1983. p. 5. quoted in Labarree 1997.
10
National Academies of Sciences 2005
11
N.Y. Times. p. 1
12
Goldin and Katz 2008
13
Hyslop-Margison and Sears, 2006, p. 1
14
Levidow, 2002, p. 227
15
Kane and Rouse 1999
16
Pauline Lipman (2011) suggests that the cultural politics of race has been central to constructing
consent for the neoliberal agenda, quoting Stephen Haynes, thusly, “the concepts ‘public’ and ‘private’
are racialized metaphors. Private is equated with being ‘good’ and ‘white’ and public with being ‘bad’
and ‘Black.’”
17
Bowles and Gintis 1976; Bourdieu and Passeron
18
Giroux 2008 p. 54
19
Slaughter and Rhoades 2004 p. 292
20
(Cranshaw, 2001, p.1 quoted in Slaughter and Rhoades, 2004, p. 294f
21
Meister, 2011
22
(Crumb 2011)
23
Fain 2012
24
New York Times, Dec. 9, 2012
25
For example, the contradiction between the idea of a noninterventionalist state and the push for anti-
choice legislation.
26
Labaree 1997
27
Collins 1979
28
Menand 2011
29
Arum and Roksa 2011
30
Grigsby 2009
31
Lewis 2008
32
Meister 2011
33
Martin 1998 p. 4
34
c.f. Mause 2009
35
Williams 1995
36
c.f. Slaughter and Leslie 1997; Slaughter and Rhoades 2004
37
Dill 2003
38
Hannah 1996
39
Ibid.
40
Hearn 1998, Slaughter and Rhoades 2004
41
Hannah 1996
42
Barnes 1999
43
New York Times 1999
44
Kirshstein and Kadamus, 2012 p. 3
45
Moody’s Investors Service 2010b
46
Moody’s Investors Service 2010a
47
https://www.cu.edu/content/debtcapacityanalysis
48
http://www.gwhatchet.com/2010/09/30/university-debt-breaks-1-billion-mark/
49
Delta Cost Project, 2008
50
National Center for Educational Statistics 2015
51
Hurlburt and Kirshstein 2012
52
Jacob et. al 2013
53
Webber and Ehrenberg 2009
54
Jacob et al. 2013
55
Archibald and Feldman 2010
56
Martin and Hill, 2012
57
It is interesting to note that this market approach to education is alive and well in K-12 policy circles.
We see it in the emphasis on student choice that views charter schools as an alternative to traditional
public schools, and in the push for portability of funds in the form of vouchers. We might read higher
education’s experience with the role transportability in cost escalation as a cautionary.
58
Labarree p. 52
59
Brewer et al. 2002
60
Frank 2001
61
Ehrenberg cited in Archibald and Feldman 2010
62
Ibid. This helps explain why retention rates are so very important in higher ed. Not only do they
contribute to an institution’s ranking, but replacing students who drop out or transfer is an expensive
undertaking.
63
Karabel 2005
64
U.S. News and World Report 2014
65
Tuchman 2011; see Brewer at al. 2002 for a discussion of the rise of prestige-seeking institutions.
66
Carlson, 2014
67
Association of Governing Boards 2xxx
68
College Board 2014
69
College Board 2014
70
College Board 2014???.
71
National Association of College and University Business Officers 2014
72
Derochers et al. 2010
73
Heller, 2008
74
Dillon and Carey 2009
75
Doyle 2010
76
McPherson and Schapiro 1998
77
Orr 2000 quoted in Barnes 2007
78
Griffin (2009)
79
Baum and Schwartz 1988
80
Griffin 2011
81
Chronicle of Higher Education 2014
82
Callahan
83
Hillman 2010
84
Porter et al. 2015
85
DesJardins, et al. 2002; Herzog, 2005; Gross et al. 2015. Note, however, that a robust literature has
demonstrated that state merit money helps keep high achieving students in state cf Orzan and Curs
2014.
86
Jaquette and Curs 2014
87
Curs and Singell 2010
88
Heller 2006; Gross et al 2015
89
Dillon and Carey 2009
90
College Board 2014
91
Marin 2002
92
Griffin 2009
93
College Board 2014
94
Harvey 2005
95
Long 2002
96
Ibid.
97
Ibid.
98
Long 2002; Bastedo and Gumport 2003
99
Goodstein and Szarek 2013
100
Railsback 2012
101
https://www.umass.edu/admissions/academic-life/honors-college
102
Callahan 2007
103
Seifert, Pascarella, Colangelo and Assouline 2007
104
Campbell and Fuqua
105
McKay
106
Slavin et al; Wolgemuth et al; Cosgrove
107
Wolgemuth et al: Cosgrove
108
Callahan
109
Astin (cited in Callahan)
110
Galinova
111
Zang 2005
112
Galinova
113
Callahan
114
Callahan
115
Callahan
116
Lanier, Pehlke, and Goodstein ("A 40-year-old honors program")
117
Bradshaw Espinosa, and Hausman 2000
118
Lewis 2008
119
Cannan and Shumar 2008
120
Clawson and Page. 2011
121
Archibald and Feldman
122
Armstrong and Hamilton 2013
123
Chronicle of Higher Education June 8, 2015
124
Ibid
125
Chronicle of Higher Education, May 12, 2013
126
Kiley 2011b
127
Lewin, quoted by Arum and Roksa, 2011, p. 12