Grade Inflation

The more we spend on higher education, the more we spend on higher education.

When it comes to reforming Big College, give the federal government a C+. Throughout 2010, grade grubbers in Congress, the White House, the Department of Education, and the Government Accountability Office (GAO) worked hard to investigate and regulate the booming for-profit college sector. Among other sins, they accused the schools of predatory recruiting practices, inflating grades to keep students eligible for federal aid, and charging too much for degrees that ultimately have little value in the workplace.

Given that the approximately 2,000 for-profit colleges in the U.S. rely on federal aid for a huge portion of their revenues, such scrutiny is clearly warranted. Still, the $25 billion in federal grants and loans that flows to them each year represents just a fraction of the $113.3 billion the government made available to higher education as a whole in 2009–10. And not all of the $89 billion or so that non-profit institutions collected in federal aid went toward teaching the nation’s youth such career-enhancing skills as how to deconstruct soap operas from a Marxist perspective. 

Indeed, while college tuition and fees keep rising, it sometimes seems as if the higher education industry is investing in everything but education. Cornell brags about its “remarkable” 4,800-square-foot climbing wall, which “is the largest indoor natural rock climbing wall in North America.” Rutgers, Carnegie Mellon, and many other universities have all invested in eSuds, an “innovative online laundry system” that allows students to see if their socks are dry without leaving their dorm room.

The continent’s biggest indoor climbing facility is unique, but costly amenities have become typical college perks these days, along with rec center jacuzzis, registered dieticians, and even tanning salons. So it may come as something of a shock that college is actually more affordable today than it was five years ago. 

Yet according to the College Board, a nonprofit membership organization that creates and administers the SAT and other tests, that’s indeed the case. In part, this is because institutional grant aid from colleges has increased from $26.2 billion to $33.3 billion since 2005–06. But the federal government has been even more generous, increasing Pell Grants from $12.7 billion in 2005–06 to $28.2 billion in 2009–10 and converting the program into an entitlement. In addition, the government guarantees hundreds of billions in student loans and has increased tuition tax credits for low- and middle-income families. Because of these goodies, the average net cost of tuition and fees for a college student at a public four-year college was $1,540 in 2010–11. In 2005–06, the average net cost, adjusted for inflation, was $2,080.

Long before gourmet meals and high-tech laundry surveillance entered the higher education canon, college was a pretty fun way to spend four years. And its benefits to individuals and society at large remain widely touted. Education Pays 2010, a report issued by the College Board, states that “median earnings of bachelor’s degree recipients working fulltime year-round in 2008 were $55,700, $21,900 more than median earnings of high school graduates.” Americans with a college degree also do more volunteer work, vote more often, and have lower blood pressure than those who don’t.

But while it may be an American tradition to pay for the nuts and bolts of higher education—the salaries of instructors, the construction of libraries and classrooms—is it really a national priority to ensure every 19-year-old has equal access to luxury dorm rooms and top-notch diversity coordinators?

In a 1992 essay for Commentary, the economist Thomas Sowell identified a disturbing trend: The cost of college was going up not because the cost of teaching students was going up but rather because “colleges and universities [had] been greatly expanding what they do.” Between 1975 and 1985, Sowell noted, college professional support staffs increased by more than 60 percent. Universities were opening campuses in Europe, building costly research facilities that had nothing to do with educating students, and paying for chauffeur services and wedding receptions for administrative bigwigs. “The availability of federal grants and loans to help students meet rising tuition costs,” Sowell wrote, “virtually ensures that those costs will rise.”

In the face of the Internet and other technologies that have made information and instruction cheaper and more accessible than ever, you might have predicted that the ever-expanding multiversities of the 1980s and 1990s would suffer the same fate as the music industry and the newspaper business. Instead, scope creep has functioned as an ingenious survival mechanism. In August 2010 the Goldwater Institute, an Arizona-based think tank that monitors government spending, released a report titled Administrative Bloat at American Universities. At the 198 colleges and universities included in the study, the number of full-time administrators per 100 students increased by 39 percent from 1993 to 2007, while the number of professors and researchers increased by only 18 percent. During this time, Wake Forest increased its spending on administrators by 600 percent, while Harvard increased its spending by 300 percent.

In September 2010, a USA Today investigation found that fees charged for athletic funding, which had increased 18 percent since 2005, were a “key force in the rapidly escalating cost of higher education.” Among 222 Division 1 public schools during 2008–09, students were charged approximately $795 million in athletic fees. 

According to the trade publication College Planning & Management, total construction costs for the nation’s colleges ranged from $6 billion to $7 billion per year in the last half of the 1990s. Then there was a construction boom, with $113 billion in new construction occurring between 2001 and 2009. Based on a survey of new buildings completed in 2009 or underway in 2010, the magazine found that physical education and athletic facilities were more popular than performance venues, which were more popular than libraries.

And while the average pay for full professors rose to $108,749 in 2008–09, according to the American Association of University Professors, little of that money goes toward teaching students. In their 2010 book Higher Education?, Queens College sociologist Andrew Hacker and New York Times columnist Claudia Dreifus report that “the bulk of the undergraduate teaching at our nation’s colleges and universities is performed by part-timers,” many of whom end up making little more than minimum wage.

But so far, it’s mostly for-profit institutions such as the University of Phoenix and Kaplan University that have inspired federal skepticism about questionable practices. Perhaps sensing that English lit cannot be taught online as well as it can be on a world-class climbing wall or in a lecture-sized hot tub—a legendary jacuzzi at Washington State University reportedly has room for 53 students—the U.S. Department of Education proposed plans in July 2010 to make for-profits more accountable for the results they deliver to students. Under the proposal, called “Gainful Employment,” institutions who graduate a large number of students with excessive debt-to-earnings ratios or who fail to repay their loans on time will lose access to federal grants and loans.

It’s true that for-profit institutions are raking in huge profits in large part because of federal subsidies. (The CEO of the holding company behind Strayer University made $41 million in 2009.) But it’s also true that few if any for-profits are using federal money to finance lengthy sabbaticals for high-paid professors who teach a handful of classes a year, or the athletic pursuits of undersized linebackers who should have hung up their cleats after graduating high school. Non-profit institutions of higher learning have been using federal money to make sure American college kids are the tannest, best-fed, most vigorously administrated students in the world for decades now. For a little extra credit, our elected officials should start holding them more accountable too. 

Contributing Editor Greg Beato writes from San Francisco.

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

  • ||

    Why don't you call me some time when you...have no class?

  • Almanian||

    Hey, "SOME TIME"....yeah, over here! Yeah, I'm callin' you "Some Time"...cause I have no class!

    What up, dog?! Now what?

  • ||

    "deconstruct soap operas from a Marxist perspective", is that really what somebody was doing at University, WHY ???

    I am going to deconstruct Marxism from a soap opera perspective: the Marxist character has a secret love but sadly is not reciprocated, to achieve her goals she will become a super bitch and destroy everyones lives to do so (So do I get a degree for my deconstruction).

  • herp||


  • Tim||

    Would you accept a Reason internship?

  • Realist||

    Much of what is taught in college use to be taught in high school

  • Almanian||

    A lot

  • BakedPenguin||

    Here are some of the courses offered at the local community college:

    MAT 0012C Pre-Algebra
    MAT 0020C Prep Mathematics Intensive
    MAT 0024C Beginning Algebra
    MAT 1033C Intermediate Algebra

    These lead up to College Algebra. The one that amazes me is "Pre-Algebra." Seriously? WTF? Are there college students who don't know fractions?

  • ||

    apparently, you are not familiar with the movement to stop teaching fractions in grammar/high school. After a student learns calculus is time enough to begin teaching him fractions:

  • ||


    Mydaughter, who is a freshman in Engineering, can't add, subtract, multiply or divide to qualify as a grocery clerk 30 years ago. So how did she get A's all through grade school & high school?

    I weep for the future of this country...

  • Gray Ghost||

    As a failed engineering student myself, how in the hell does she expect to be able to do well in engineering if she can't understand fractions?!

    (DiffEQ was what did me in, all those years ago.)

  • ||

    Tex, I hate to tell you this, but your daughter isn't going to make it through engineering school... Engineering school is really tough and the first 2 years see over 50% dropout rates.

  • Miku||

    If I never learned fractions I would have been fucked when I got to calculus. And pretty much any math class I have had in college, and I am a math major.

  • ||

    I'm not sure I have a problem with those classes at a Community College, BP.

    There are a lot of people who fucked up their initial forays into education who can really get back on track if they have a chance in later life.

    And IIANM serving older students is a serious pat of the mission of community colleges.

    And I was about to say get back to me on the astrology and basket weaving type classes on offer but I'm actually pretty sure I've heard that these kinds of classes are actually a net revenue gainer for most CCs.

  • ||

    But, when we're talking about four year colleges, I'm with you all the way.

  • BakedPenguin||

    Isaac - I actually understand the need for them, I was just blown away that "Pre-Algebra" was on there. What I remember from grade school, pre-Algebra consisted of long division and fractions. However, your point about returning learners is a good one.

    Madbiker - that's amazing. Fractions seem like such an obviously necessary concept to learn, I can't believe someone could seriously propose that.

    When I figured out that percentages, fractions, and decimals were essentially synonymous, it made all 'pre-Algebra' math much easier for me.

  • Red Rocks Rockin||

    Perhaps they should stop calling them "community colleges" and rename them as "finishing schools for low-to-average-IQ striver poors."

  • Spartacus||

    Yes. Lots of them.

    A lot of those remedial students are ones who scraped through high school, went to work for ten or more years, and are trying to go back now. Latest stats are that someone who starts out in MAT 0012 has about 5% chance of eventually making it through college algebra.

  • ||

    Don't you get it? Public school is a complete sham. Even the colleges know that they have to re teach you everything that they were supposed to have taught you in high school. When I first entered college 6 years ago, my first reaction was, "What the fuck was public school even for?" The kids who weren't college bound certainly didn't get anything out of it, and the kids who were college bound would just be re taught the same stuff in a superior fashion.

    Public school is daycare. Period.

  • ||

    That's not all that new - I tested out of a year of college my first year. Because I'd gone to a good high school. Took the final exams in a bunch of classes and aced them all. First actual math course I took in college was Calculus.

  • ||

    OOPS - P.S. Graduated HS in 1974...

  • Realist||

    No, these are college who don't know Jack! Before or after they graduate.

  • Realist||

    should be ...."college students" who....

  • ||

    Yes. Many don't.
    In approx.1980 a Prof. at my institution who taught freshmen chemistry for non science majors found 50% of the students couldn't solve simple 8th grade fraction problems.

  • ||

    Most of the incoming freshmen to whomI have taught physics struggled with fractions and basic algebra.

    Incidentally, the Jacuzzi at WSU is not legendary; I've seen it. It's part of a huge student rec center, which has a really big weight room, an indoor track, like six basketball courts, racquetball, etc.

  • Jim||

    I was in college from 2000 - 2004, and well remember these arguments going on amongst professors and students. They were constantly raising our athletic fees, built a new golf course, new english buildings, replaced the commons with a giant fountain, etc. just in the first two years I was there. The excuse was always, "we need to be competitive to attract new students, so if everyone else is doing this, we can't be left behind". It was basically a freaking arms race to ensure your campus seems as nice as everyone elses.

  • Special Sauce||

    My exact same experience. With an added bonus of dumbed down curriculum so that the majority of new students could have a chance at passing their courses.

  • ||

    On the other hand, they seem to be giving their customers exactly what they really want (and not necessarily what they tell their parents' adult friends they want).

    What they say to Mom & Dad and other adults: "I want a challenging academic experience in which I can flourish and be prepared for a lifetime of meaningful work."

    What they really want: "I want a nice dorm room with a flat screen and en-suite bathroom, kickass football and basketball teams, a swimming pool and indoor volleyball court, a minimum 3.65 GPA with practically no effort, and a guaranteed six-figure job when I get out."

    Well, I guess colleges are giving their customers everything but the guaranteed high-paying job. Those poor wee urchins.

  • Obama||

    "I want a nice dorm room with a flat screen and en-suite bathroom, kickass football and basketball teams, a swimming pool and indoor volleyball court, a minimum 3.65 GPA with practically no effort, and a guaranteed six-figure job when I get out."

    But this would be fair, no? We're talking about good jobs, for good folks.

  • ||

    What they need is that idiotic "BA" to put on their resume. so they can ask if you want fries with that. What the employer needs is to stop asking for degrees which have nothing to do with the jobs offered.

  • Spartacus||

    Yep. It's not an excuse--students demand this. I talk to our student government leadership all the time; having a nice campus with lots of "extras" is a very high priority.

  • Vermont Gun Owner||

    A joke on my campus was that construction never ended, it just moved a couple buildings down. From the time my oldest sister went there until the time I graduated (2002-2010) there was always at least 1 multimillion dollar construction project ongoing.

  • ||

    I was on the building committee of my state inst. for 20 yrs.
    The Chancelor once bragged that we had the smallest maintenance budget in the state system. I commented that that was the reason that our older buildings were in disrepair, leaking and in one case had highwater marks above transformer levels in the basement. We had a fifteen year backlog schedule for repair. I moved we survey needs and shorten the timeline. Couldn't get a second.
    Later the Chancelor told me I didn't understand.
    "The American way is not to repair, but to build new ones. DIFFERENT BUDGET ENTRY"

  • Zeb||

    This is exactly why I will never give another cent (beyond what I paid in tuition) to my alma mater.

  • Red Rocks Rockin||

    A damn good lesson in why trying to "win the future" leaves everyone a loser.

  • CatoTheElder||

    "college is actually more affordable today than it was five years ago"

    I call BS. This statement is true only if one gets government financial assistance; i.e., if one qualifies for and is willing to accept welfare. For people who actually pay for their education, rather than leeching off the taxpayers, tuition and other costs have continued to escalate.

    This is as absurd as saying that medical costs are more affordable now than in 2000 because Medicare Part D cut prescription drug costs for geezers. As if gouging taxpayers and racking up deficits makes something affordable ...

  • Fiscal Meth||

    But you are a tax payer. Why wouldn't allow yourself to take back some of the money that has been taken from you against your will through the years. You could take advantage of every program there is and still not be leaching off a single tax payer other than yourself.

  • Almanian||

    This - well done, Fiscal Meth :)

  • ||

    THIS is why I don't feel so bad about being unemployed and collecting UI.

  • ||

    I know this makes me a terrible hypocrite.

  • BakedPenguin||

    Considering how far the government has insinuated itself into our lives without us having any real choice in the matter, where do you draw the line?

    It's like the douchebags who call us hypocrites for calling public firemen when our house is burning, or for using public roads...

  • Fiscal Meth||

    No, it doesn't. As long you don't get back more than has been taken from you. And as long as you don't advocate for the laws that take money from some people to give to others. If you do advocate to keep redistributive laws, however you have no right to any of it. Becuase you had a hand in taking it. If you have always opposed it then money has only been stolen from you and you have helped steal from no one and it is fine. Though you probably won't get as much money that way as you would if landed a good job.

  • ||

    Nice rationalization, but money is fungible. You can never really get back "your money". You're still leeching.

  • Fiscal Meth||

    No, but if I steal $20 from your wallet, I owe you twenty dollars.

  • ||

    Nice rationalization, but money is fungible. You can never really get back "your money". You're still leeching.

  • Old Mexican||

    You don't have to say it again. You don't have to say it again.

  • ||

    I'm gonna go get the papers. Get the papers.

  • Tim||

    Degrees are worth less every year, so why shouldn't the cost be going down?

  • MNG||

    "is it really a national priority to ensure every 19-year-old has equal access to luxury dorm rooms and top-notch diversity coordinators?"

    This. +1

  • ||

    I once joked that we cuts costs by taking a random college senior through the administration building. Any job title he or she sees that they can't explain, the university fires that person.

    A related idea is to fire anyone who can't explain their basic job in a single breath.

  • ||

    W-well look, I already told you! I deal with the goddamn customers so the engineers don't have to! I have people skills! I am good at dealing with people! Can't you understand that? What the hell is wrong with you people?

  • Hooha||

    Hee hee! As a former salesman that detests salesmen and respects the input of those that actually know what the hell they're talking about (in this case, the engineers), I found this delightful.

    Do one on middle management! :D

  • Edwin||

    That was a reference to Office Space. I'm afraid you may have gotten the wrong message - the implication is that the guy's job is useless and he isn't needed in the company.

  • Ted S.||

    I figured much of the escalating cost of college out when I was a freshman 20+ years ago. We had to fill out a financial aid application, and based on that, the college would figure out how much the family could pay. The rest of the costs of tuition/room & board would be made up out of scholarships/work-study/loans.

    I quickly realized that if government made more money available, the effect would be that I would still have to pay the same amount, but there would be a greater "rest" of tuition coming from the government monies.

  • squarooticus||

    "How much for the repair?"
    "How much you got?"

  • ||

    Perfect working example of

    "You charge what the market will bear"

    Gubmint monies make the market bear a lot more.

  • sevo||

    in addition to a degree, the only thing I got out of college was at least one incurable STD.

  • Vermont Gun Owner||

    With all the free condoms they give away?

  • ||

    All the while, this article downplayed the fact that these private colleges are ripping us off, profiting at tax payer expense. No more federal money for private colleges. Yes, I benefitted from a subsidized loan-but, I didn't finish school due to lack of dilligence.

  • Old Mexican||

    "But so far, it's mostly for-profit institutions such as the University of Phoenix and Kaplan University that have inspired federal skepticism about questionable practices."

    The productive and the efficient will always suffer the burden of being under the greedy eye of the State.

  • ||

    Eh, a bit Ayn Randish for my taste. Aren't you noticing that they are robbing the taxpayer blind.

  • Old Mexican||

    Re: Null Void,

    Eh, a bit Ayn Randish for my taste. Aren't you noticing that they are robbing the taxpayer blind.

    You win the "Head in Sand" award. Who levies the taxes?

    It is the STATE that's robbing you and me blind. The rent-seekers simply land on the loot like flies on shit.

  • ||

    That doesn't make said rent-seekers "productive and efficient" though. It makes them flies on shit.

    If the for-profit model is going to be held up as an alternative to traditional higher education with an improved incentive structure, it needs to get the fuck off the government tit.

  • ||

    Maybe they should certify the Teaching Company.

  • Old Mexican||

    Re: Rhayader,

    That doesn't make said rent-seekers "productive and efficient" though.

    Nobody said that it did. I simply responded to Null Void's timely non sequitur.

    MY comment points out a simple fact: Government will always go after the productive and the efficient. Maybe Kaplan and Phoenix receive federal grants. So do almost all colleges. But the State places special attention on Kaplan and Phoenix, merely the highest growing learning institutions in recent years. It is NO surprise these two colleges have been the targets of older (and more expensive) crybaby institutions, the lapdog media and (obviously) the Fed Gov.

  • ||

    Yeah, I guess what I'm saying is that the idea of places like Kaplan and Strayer being especially "productive and efficient" loses quite a bit of credibility when you realize they're subject to the same flawed, subsidy-based incentive structure as any other institution of higher learning.

    I'm very sympathetic to the case in favor of for-profit education, but the model doesn't do any good if it depends on the same tired structure.

  • Old Mexican||

    Re: Rhayader,

    I guess what I'm saying is that the idea of places like Kaplan and Strayer being especially "productive and efficient" loses quite a bit of credibility when you realize they're subject to the same flawed, subsidy-based incentive structure as any other institution of higher learning.

    Granted, but let's say their competitors have a long lead ahead of them in being even worse. My arachnid senses detect flim-flam being perpetrated by the State when it purports to "investigate" someone who happens to be successful.

  • Gregory Smith||

    College is a scam, unless you study a practical career like engineering, medicine, law (not anymore), or information technology you're barely gonna make any real money.

    Besides, what's wrong with going to trade school and becoming a plumber, electrician, truck driver, mechanic, or any number of practical and lucrative professions?

    Education isn't a right, it's a privilege. Even so-called "public" schools restrict admissions based on GPA, SAT's, etc.

  • Zeb||

    Or unless you don't expect that it will make you money. Many people, myself included, find some value in education for its own sake (though I am sometimes ashamed to say it when I hear about a Marxist analysis of anything). But it is a privilege and no one should be forced to pay so someone can study literature, for example.

  • Grade Inflation||

    also, holy crap this is ridiculous in MBA schools. I am just finishing up one right now (evil investment banker now), and it is quite literally impossible to get lower then a B. Even getting a B is a challenge. A- is average. Its a joke.

  • ||

    Eh, they'll give a B- at the school I attend, at least the history department will. Granted, one has to read almost none of the assigned material and all but not study (due to being either a step from suicidally depressed, or working 40 hours a week), when it's a completely unfamiliar subject.

    I did manage to pull As in both introductory micro and macroeconomics while literally skipping every lecture, only completing the (online) homework and taking the tests.

    My overall (undergrad) GPA is somewhere around a 3.5 (higher than high school) in spite of being about as poor a student as is possible.

  • Max||

    More higher education means fewer donations to Reason. Stamp it out!

  • Old Mexican||

    Re: Max,

    Max, H&R's pet yorkie.

    Here, Max! Here, boy! Go fetch!

    NOOOO! No, no! Don't do your banalities on the carpet, I just had it steamed! Bad boy, Max! Bad, bad boy!

    Somebody get me a rolled-up newspaper! There will be lotsa snout-rubbin'!

  • ||

    If only Max had been educated...

  • Fiscal Meth||

    More higher education for max would also free up a bedroom at his mom's which she could finally turn turn into that guest bedroom she's always wanted after hinting for twenty years that he should meet a nice girl and move out. Of course she'll have to clean out all those jizz napkins first.

  • cynical||

    Worst episode of Hoarders ever.

  • CSI||

    I like how many people say "well obviously we need to work out who isn't suitable for college and send them to technical school to learn a trade" like learning a trade is something that only for dummies who can't handle college.

    But learning many trades now probably requires more technical knowledge, more study and more math than many college degrees.

  • ||

    I have to agree with that. Electrician anyone (I've seen those exams.)? And even auto mechanics have to know how to deal with computers nowadays.

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  • ||

    Criminal or Great Parent: Black Mother Jailed for Sending Daughters to White School........

  • ||

    Its not the school's fault. Nothing survives contact with government money.

  • ||

    Amid all of this spending, graduate students and "adjunct" instructors bear much of the burden of teaching and grading, and they earn a relative pittance.

    Here are 100 reasons not to go to grad school:

    Reason 32 points out that universities have turned into paper-pushing job creation machines. Students? They just provide an excuse for the jobs.

  • bigT||

    More students going to college is degrading the value of a college degree because the students aren't learning much.
    ""It's not the case that giving out more credentials is going to make the U.S. more economically competitive," Arum said in an interview. "It requires academic rigor ... You can't just get it through osmosis at these institutions."

    It is much like home ownership - owning a home doesn't make one a good citizen, doing the hard work, saving and being responsible so you can afford to buy a home with 20% down makes one a good citizen.

    Government interference in both is damaging the country.

  • nike running shoes||

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  • tory burch||

    I gave Mary Jean Ryan my duplicate concerning the 2008 NMAP even although in the trail Map Conference she brought using just one an even more in Seattle recently. Why does anybody cellular phone phone for just about any conference or retreat to just adopt the recommendations of that guiding document? repairing math would give me think by which they are in a placement to acquire something, something accomplished. undoubtedly there exists only proof which they cannot fix math. I uncover myself hoping for just about any do no harm clause in relation to college admin.

  • Air Jordan Ol School||

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  • قبلة الوداع||

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  • Daniel Baughman||

    Some things can be taught online, but learning is about experience. Trade schools, I believe, teach the best with hands-on activities that emulate the real world. You can't teach that online at the University of Phoenix.

    Also, although students at for-profit schools make up 9% of American college students, they account for more than 40% of defaulted student loan accounts. Also, students graduating from for-profit schools, have more than twice the debt of traditional college students.

    Bottom line is that education is a public trust. The drive to make money off of it is part of what is driving the quality of education down. Notice how the for-profit model has crept into the traditional college systems. They need to compete to make money now...and the students are the ones who end up hurt.

  • دردشه عراقية||



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