[quote]More applicants (especially poor applicants, especially poor, smart applicants) are better off today than they were 20 years ago.[/quote]

I think that is open for debate. In the last ten years, there has been a major shift away from need-based aid to merit discounting/enrollment management. I don’t think that shifting financial aid dollars from need-based students to price discounts for wealthier students is overall beneficial to “poor students” when we look at the system as a whole rather than a single data point from one hugely endowed college.

The data is very difficult to pin down, but I see no evidence to suggest that there are more “poor students” at places like Williams today than there were 35 years ago. If you accept median family income as a measuring stick, there may actually be a smaller percentage of “low income” students.

I think its unfortunate on Ephblog that people seem to believe that the world in which Williams operates is the same world that most other institutions operate.
It would be naive to believe that competition between schools hasn’t lowered the real cost of an Ivy education. But is equally naive to believe that the amazing growth in endowmnents during the 90’s hasn’t also allowed these schools to dig deeper to find more financial aid for poorer students as part of their mission. Both motives are at play and only highlighting one over the other is intellectually dishonest.
The problem in higher education is that most schools cannot afford financial aid for poor students, and price discounting to entice upper middle income students to attend. Schools only care about net tuition, so a $10,000 discount to an out-of-state upper middle class student means they still receive $10,000 in tuition. To get a poor in-state student requires a $5,000 financial aid grant, but results in only $1,000 in tuition. Overall, the school is better off by shafting the poor kid.
Williams doesn’t depend on tuition for its budget and thus doesn’t face this scenario. It really wants poor students because it increases diversity some how. But not everyone is like us. And taken in this context, Gordon Whinston is spot on in his analysis of Oregon State.

1) I agree with Richard that both competition among colleges in the post-Overlap era and the rising value of endowments play a part. Figuring out their relative importance is not easy.

2) Richard writes:

I think its unfortunate on Ephblog that people seem to believe that the world in which Williams operates is the same world that most other institutions operate.

Good news! I do not know of a single regular reader of EphBlog who thinks this. We all know that Williams is richer than most schools, that its students are the elite and that it is extremely unrepresentative of the rest of higher education.

Still, Williams is our main focus. I tried to make clear that I was being somewhat unfair to Winston by applying his critique (which is certainly true of some schools and may be true of most schools) to Williams where it is not true at all. But, the fact remains that Williams students from families in the bottom quartile of income graduated with plenty of debt (6 figures?) in the 1980s while graduating with zero debt today.

There is simply no way to deny that poor kids accepted by Williams are better off today than they were 20 years ago.

I also believe (others may disagree) that the fundamental reason for this is the end of Overlap and the concomitant increase in competition for elite students. In a counterfactual world in which endowments were held constant (or grew at their traditional rates), I believe that you would have seen the same changes.

Now “enrollment management” is just one aspect of this increased competition. It is not the cause of these improvements, it is merely another system of the underlying trends. But, I think, the total package can not be separated out.

You can’t have increased competition for students without phenomenon like enrollment management. People who complain about the latter are generally those who pine for the good old days when the colleges had all the power and the students had very little, when people like Winston decided who would go where and how much they would pay. In the brave new world of competition and enrollment management, students have the power.

In fact, given that enrollment is much higher now than it was 20 years ago, there are many more poor kids in college in 2006 (in raw numbers and in percentage of the population) than there were in 1986. Under what possible metric is the world a worst place of a) more poor kids go to college and b) poor kids at places like Williams pay less money?

Ok, let me qualify then: I will claim that a great many of those not affiliated in some way with another institution do not comprehend exactly how different Williams is. Williams isn’t slightly different, a little different, somewhat different. Williams operates in rarified air that only 4-5 other schools also get to breathe (Amherst, Swat, Wellesley, Pomona, Carleton). Our endowment and name recognition really make us that much different.

Based on what you wrote, I think it another example of your regrettable rhetorical style. You misrepresent someone’s conclusion to motivate your point, lots of opinion, and later is the remark: “but I am probably being a little unfair to XXXXXXX.” Maybe you should recognize the complexity before you go off half-cocked, attributing ideas that aren’t there.

Give me a break.

1) Poor (very) smart kids (say SATs above 1300) are much better off today than they were 20 years ago. On average, they graduate from school with much less debt. They have many more options. Would you disagree?

2) Poor (less) smart kids (SATs 1000 to 1300) are also much better of today than they were 20 years ago. Many more of them take the SAT in the first place. Many more of them go to college. Would you disagree?

Now, any time society changes, there are winners and losers. I am sure that we could find at least one poor 18 year-old who would have been better off going to college in 1986 than she is in 2006. (An example might be someone from Massachusetts who wants to go to Oregon State University. The rise in competition and enrollment management might have made this student worse off since OSU is now much more focused on charging out-of-staters more money than they were 20 years ago.)

But, big picture, poor kids as a class are better off today, indeed much better off. And Winston knows it! Perhaps that is why I give someone like him — an expert academic in the field — such a hard time. His rhetorical flourishes confuse people into thinking that poor kids have it worse today than they did before.

Now, Winston might wish for a world that was just like the world we live in except that there was no enrollment management. That is a pleasing fantasy for some. But it is still a fantasy. Unless you pass some laws which prevent colleges from acting in their own self interest, they are going to, you know, act in their own self interest. The wonder of the free market is that these selfish desires are channelled in such a way that they make all of us, rich and poor, better off on average than we would otherwise be.

Now perhaps I have this all wrong. You accuse me of “misrepresent[ing] someone’s conclusion to motivate your point.” Fine. What, precisely, is the “conclusion” that you impute to Winston? What is he trying to say?

No David, you don’t get a break. No break for you because you do the same shit over and over and over again. You thrive on misrepresenting people to prove your point.

For nearly every school, because tuition pays the bills, there is an incentive to use available financial aid money to lure upper middle class students. If you can drop your price from 20,000 to 10,000 you have a shot of snagging an upper-middle class kid. You may need to drop your price to 0 to snag the poor kid. You get can get the same class size with a smaller tuition revenue hit if you direct financial aid money to richer students. So schools massage their formulae to get richer and richer students eligible for financial aid: i.e. they look at income rather than assets. And at the end of the day, poor kids come out screwed. Now, not the really really smart ones that are getting into Harvard and Williams. They will do fine because of this competition. But for everyone else, from the 95th percentile down the SAT scale, they will get screwed if they are poor.

It’s sad and that is precisely what Whinston is describing. And it is precisely here that you take something written about higher ed in general and misapply it to Williams. Believe it or not, Whinston thinks other types of schools matter too.

And while you tout competition, this is one of the prime examples of a market failure leading to a socially undesirable outcome (in the economic sense). What you are seeing is the market for average poor students unravel.

Perhaps more succintly to your argument:
Really smart poor kids are better off, but the vast majority are worse off than 10 years ago. One need only look to the majority if state universities to see this.

I agree with Richard. It is not at all clear that “poor” students are, on average, better off today than 20 years ago.

It’s a complex equation and I would hesitate to make blanket statements, but there is statistical data showing that college is less available to poor families. Certainly, federal aid has been gutted. And a lot of financial aid money has been shifted from low-income families to wealthier families, even at state universities.

And, I don’t think we should exclude the Williams and Swartmores of the world either. Fewer than 10% of Williams’ students come from families making less than $40k per year. 58% of Williams students do not qualify for one red cent of financial aid. They write a $42,000 check each year. Do you honestly believe the student body isn’t skewed wealthy?

1) We agree on the mechanics of enrollment management. Indeed, this was one of the topics of CGCL two years ago.

2) We agree that smart poor kids (>1300 SATs?) are better off. Those poor kids are not screwed. We might quibble on whether the cut off is 1400 or 1200.

3) We disagree about whether the relevant comparison is to 10 years or ago or more like 25. Since The Student Aid Game was published in 1997, it seems unlikely that 1996 was some sort of pre-enrollment-management golden age. Better to compare today with 1981 or so.

I guess that we disagree on the meaning of the phrase “screwing the poor kids.”

My questions: Screwing the poor kids compared to what?

Anytime that you argue that something — enrollment management, the end of Overlap, increasing use of SAT scores, whatever — is hurting (or helping) group X, you need to have a clear notion of what the alternative is. You need to posit a plausible world in which that “something” does not exist and in which all (or most) of the things that you like about this world do exist.

There can be no doubt that some types of poor kids that applied to OSU 20 years ago (and got in) are worse off today since OSU is less likely to accept them. A concrete example would be out-of-state (say, Massachusetts) applicants. But what happens to those kids today? Don’t they go to college? Yes! But, they go to UMASS.

Now, if enrollment management — and all the other trends that people like Winston have a tendency to decry, all the inevitable results of increased competition among colleges — could be easily removed from the equation, that might be worth considering. In that world, more poor Massachusetts students might get in to OSU.

But

a) There is no obvious public policy that would accomplish that goal. How would you outlaw enrollment management even if you wanted to?

b) Even if you did outlaw it, would poor kids as a class be better off? Would more of them go to college? Would more of them go to “better” colleges? And who would give up those spots?

Now, this is all very theoretical and uninteresting. Fortunately, we have two worlds that we can compare. The world as it existed in 1981 and the world today. Poor kids are better off today. Isn’t that obvious?

You claim that:

[T]he vast majority [of poor kids] are worse off than 10 years ago. One need only look to the majority of state universities to see this.

Huh? Again, 10 years is not a useful time period. But, as far as I know, all these statement are true:

1) Out of all the poor kids in the country, a higher percentage are in college today than in 1981.

2) The average college (including state universities) is no worse today than it was in 1981. (Indeed, from a student/consumer point of view, many of them are better with nicer facilities.) Are you arguing that biology is taught worse at OSU today than it was in 1981? That the dorm rooms are smaller and more crowded at UMASS today than in 1981? That the variety of food served in the caferia is lower?

3) The average out-of-pocket expenses to attend college for poor students is no higher (as a percentage of family income) today than in 1981. (I am not certain about this one.)

So, if more poor kids are in colleges that are at least as nice and no more expensive than they were in 1981, what is the problem?

As always, there are issues. I am, for example, very suspicious of student loans and some of the sleazy companies that peddle them. But, big picture, poor kids are better off today than they were in 1981. Describing them as worse off is misleading.

I think I disagree with your conclusion because I disagree with your underlaying claims.

Let me make a series of claims:

1) It is relatively more expensive for poorer students to pay for college. This directly addresses your third point.

This follows from 3 facts. The real income of those in the lower third of the income distribution have fallen in the last 10 years. Those in the top decile have increased. Almost universally, the cost of tuition has increased at a rate higher than inflation. For most institutions, financial aid has not kept pace with the rate of tuition growth. Your third point cannot be true if all three of these are also true. (I believe your claim is true for Williams and Princeton, but it is not true in general, which is the basis of this argument)

These 3 facts immediately demonstrate that in general, poor students face a higher cost of education than 10 years ago.

2) The majority of students are educated at public institutions.

I believe the only states in which this is not true are some of those in New England.

3) State budget cuts have changed who teaches classes.

According the the Department of Education, in 1987 8% of classes were taught by those not on tenure track. In 1998, the number was 18%. So, biology at OSU is more likely to be taught by a graduate student or ABD than 10 years ago.

4) Poor students make up a smaller percentage of the college population, at least for males.

Males from families with less that 30,000 in income were 22% of males attending 4 year colleges full-time in 1992. By 2004, they were only 13% (this number accounts for inflation by considering those from families with less than 40,000 since the CPI between the two years is 1.35).

5) An increase in the percentage of poor students is not a sufficient statistic. The percentage of students going to college increased, period. More people are willing to accept the financial burden because the degree premium has been increasing. If you don’t go to college, you will fall even farther down the socio-economic ladder. Everyone has realized this and so naturally, when the gain to a college education increases, so will the number of individuals choosing to go to college. However, because of its increasing cost, poor students are not increasing attendence at nearly the same rate as wealthier students.

I hope this clears up some factual issues. It is pretty plain that poor students are being priced out of the market for a college education. Those who do go onto college are often finding themselves at universities where classes are being taught by grad students and ABD’s.

I do not think this is at all misleading; I think many of your beliefs about college costs are incorrect.

I’d like to go back to one of David’s earlier claims, that students from families in the lowest quartile of family income during the 1980s graduated with debt in the six figures. Where is this coming from?!?!?

Speaking as one of those lowest quartile students who also happened to know a fair number of other lowest quartile students, I can attest to the fact that it would have been pretty difficult to graduate with more than $12,000 in loans in the 1980s. While it is undeniable that the College’s current policy of no-loan packages for low-income students is a wonderful step, most low-income students prior to this policy did receive very significant grants and their packages generally relied on no more than $2500 a year in loans. The formula, if I recall correctly, was (Tuition + R&B) - (family contribution + $2500 loan + $750 work study) = grant. If your expected family contribution was low, your grant would be pretty significant. Most difficulties for students in the lowest quartile, including myself, stemmed from a package that assumed a parental contribution higher than parents were able or willing to contribute. When this happened to me in 1985, Phil Wick stated categorically that I would not be able to borrow more than the $2500 limit. The only loan option I had to make up the difference would have been to convince my parents to take on a PLUS loan, which they were unwilling to do. I can’t imagine that more than a small number of parents took out these loans and then handed the repayment off to their children.

In fact, what most of these students did was work as much as they could during the summer and pick up as many jobs, both on and off campus, as they could, to make up the difference. I personally would have been thrilled to have been able to borrow more than $2500 a year and thus drop a few dining hall hours every week. And, in fact, there are a number of loan options, as well as higher loan limits, available to students today that weren’t in the 1980s

The no-loan policy is a wonderful step that a very small number of schools are able to take, thus making them more financially manageable for low-income students today. I think it’s an overstatement, however, to say that this policy, in and of itself, is a huge improvement over policies in effect twenty years ago. Rather, I think a bigger part of the improvement has come from revisions to the formula used to determine family contributions, most notably the elimination of most home equity from the calculation. I’m not convinced, though, that Williams students are able to work fewer hours than they did in the 1980s, and that would be, in my opinion, one of the best changes that could be made to current policy.

My bottom line: This really is a pretty silly discussion, even for Ephblog. Williams (and the other schools with huge endowments) have the flexibility to offer financial aid according to (almost) exclusively need-based criteria. The situation at these schools has always been good, with relative improvements occuring within a fairly narrow range. Richard Dunn is absolutely correct when he says that Winston’s diagnosis is very much applicable to pretty much any school that has more limited funds awarded on merit-based grounds. These are the schools attended by the vast majority of college-bound students and the poor among them ARE getting screwed. If we assume that all students admitted to a given school are qualified to attend that school, it is unjust, in my opinion, that some are unable to attend due to cost while money that could ease that burden is used to “buy” non-needy students. This goes to the very heart of the college accessibility issue.

As established by David, the goal of the College should be to become its “best”. That goal having been accepted, then in the College’s pursuit of it any person’s or group of persons’ more or less screwing should be written off as mere collateral damage. Wittgenstein would be proud!