In yesterday’s New York Times, David Leonhardt wrote a piece claiming that the federal government is exaggerating the price of college attendance.
This article is highly inaccurate. The cost of college has gone up dramatically and nothing in this article disputes that. Unfortunately, Leonhardt mistakes price for cost, and tries to convince the reader that government is “overstating” the cost when in fact the main reason that net price (which families pay) is different from the cost is because of government subsidy in the form of financial aid. Remarkably, he claims that the “government ignores financial-aid grants”– far from it, it funds them! If the federal government only reported the price after those grants it would be impossible to see why our investments in financial aid have had to grow so much– the costs of institutions.
The argument Leonhardt makes is straight from the press releases of the College Board, and it’s disconcerting that he swallowed the claims of that big business hook line and sinker.
But it gets worse. He then attempts to explain financial assistance by comparing discounting in higher education to discounting at Joseph A. Bank—a clothing store. This is both inaccurate and tone-deaf. The cost of the “mirage” — posting one price and offering another– is not very high in a clothing store (e.g. poor people don’t suffer from not wearing Bank’s clothes) but the cost of this complex discounting scheme in higher education is that it scares off prospective students. The impacts of sticker price are difficult to estimate because they affect people far distant from the actual college application decision– it affects their very thinking about whether college is possible at all. But to Leonhardt’s mind, apparently people who do not “get” this simply lack intelligence—he writes “If you take Joseph A. Bank’s sticker prices literally, you don’t understand its business.”
Pieces like these are supposedly written to ensure that low-income Americans are not frightened and still pursue college. But I have come to doubt the sincerity of those intentions, especially when in doing so the author downplays the massive investment government has made in financial aid and invokes classist frameworks to make his points. Instead, the real function of these pieces is to support an industry of expensive colleges and universities that want to continue to profit from a culture in which families conflate cost and quality, and treat a college education as a consumption good. The College Board and its supportive schools have made a great deal of money off that culture and have helped to breed it. It seems that the Upshot is now doing its part as well.