Tuition on Trial – Obama Takes on Rising Cost of Colleges
February 22, 2013

In his State of the Union address earlier this month, President Obama issued a challenge to colleges,  universities and lawmakers to address the continued rising costs of higher education. During the SOTU, Obama criticized colleges for not controlling tuition saying, “Taxpayers can’t keep subsidizing higher and higher costs for higher education.” The President then took it a step further and tasked Congress with ensuring the cost of colleges are better controlled. He said, “Colleges must do their part to keep costs down, and it’s our job to make sure they do.”

But other than finger wagging and speech-making, what can our lawmakers do? According to the President, they should “change the Higher Education Act so that affordability and value are included in determining which colleges receive certain types of federal aid.” But if the government takes money away from colleges won’t that then cause them to ask for more from students and their parents to fund their educations?

According to the President, this is not acceptable. He says, “We won’t grow the middle class the middle class… by shifting the cost of… college onto families that are already struggling.” The only equation where the math works that the government funds less and families don’t pay more is for the costs of colleges to decrease. Is this doable or will the attempt result in student loans continuing to rise on a per student basis to cover the rising costs?

The day after the SOTU, the White House announced the release of the “College Scorecard” – prepared by the Department of Education’s College Affordability and Transparency Center. The scorecard is intended to allow students and parents to search out colleges that are affordable and a good value for what they want to do. You can search by degree, major, location, whether distance education is offered and other criteria (see graphic above.)

These criteria can be applied one on top of the other to refine a college search. Once you have a list of colleges that offer the program you want in the area you want, you can compare them to see which are in your price range. You can also see the percentage of students that graduate (a good indicator of how effective a college is) and other post-grad info.

But even with this information in hand, will families opt for what’s affordable over a parent’s alma mater? Will they turn down a prestige school if their child gets an acceptance letter? Until families start saying “no” to colleges that are not a good value, colleges have no impetus to adjust their tuition or find a way to control costs.

The trump card the government holds in getting colleges to better toe the line on costs is accreditation. If a college is not accredited, degrees granted are much less valuable. To teach, practice medicine, law, engineering and other professions, you must have graduated from an accredited school. The day after the SOTU, the White House released a report “The President’s Plan for a Strong Middle Class & a Strong America.”

The report states: “The President will call on Congress to consider value, affordability, and student outcomes in making determinations about which colleges and universities receive access to federal student aid, either by incorporating measures of value and affordability into the existing accreditation system; or by establishing a new, alternative system of accreditation.”

I wonder whether Congress would ever dare play this trump card. With costly Ivy League schools producing a preponderance American Presidents and lawmakers, would their alumni actually vote to limit the accreditation of their alma mater over tuition costs? And would they even consider it when school professors and alumni are major campaign contributors? While I agree that making the cost of colleges more affordable is increasingly of national concern, I doubt that this critical social and economic issue can overcome special interests.

Please share your thoughts on how college costs could be made more affordable and whether you think Congress will follow through on President Obama’s charge that they address this pressing need. Whether you are a student borrowing to finance your education or a graduate juggling work, home and student loan debt,’s free tool can help you best manage your student loans.