The comments on my messy neoliberalism post are focusing on Kevin Carey’s testimony at the affordability hearing this week. Since Carey is usually much more careful in distinguishing between well-endowed private colleges and universities, tuition-driven privates, flagship publics, regional publics, and community colleges, the following passage astonished me:

There is no doubt that colleges have raised their  prices in recent years because states reduced their subsidies for higher education. Some states have hacked hundreds of millions of dollars from public university budgets, and universities have responded by reducing access to courses and imposing dramatic price increases on students and parents…. States need strong incentives to maintain their commitment to higher learning.

But it’s also important to note that, over the long term, college prices have gone up in good economic times and bad. When state funding goes down, college gets more expensive. When state funding goes up, college gets more expensive.

That last claim substantially dismisses concerns about cost-shifting in public higher education, and just does not hold water for many states. In Florida, for example, here are the data on Florida’s state university system in terms of general revenues per FTE and tuition dollars per FTE from the mid-1980s, taken from the Florida Board of Governors budget summary and adjusted by inflation:

There are only two eras in which state funding per FTE increased much: the late 1980s and the late 1990s, and the high point of state funding per FTE in the past quarter-century was in 1988-89. System tuition revenue per FTE stayed basically constant in the late 1980s upswing until the first year that state funding declined (1989-90), when tuition per FTE jumped substantially.¹ In the late 1990s, it looks like tuition revenues per FTE rose along with state funding until you look back to the early 1990s, and then the comparison is startling: $2933 in tuition revenues per FTE in 1993-94 vs. $2947 in 1999-2000. Since then, it’s been a fairly steady downhill run in state funding, with cost-shifting to students. In the last fiscal year, the state university was operating with one half the state funding per student it had in 1988-89.

For Carey to claim that higher education writ large always increases its revenues from students “in good times and bad” is simply untrue for Florida’s university system. I suspect that would be even more evident for community colleges.

I suspect I know where Carey’s statement is true (but would love confirmationor disconfirmation): for flagship universities and for some 4-year systems in the Northeast. I suspect it is least true in the community-college world.

Notes

1. While I was using the BLS CPI deflator calculator, I’m not sure the general picture would change much with a chained CPI or a regional or state inflation measure. [↩]

Related posts:

1. “Ther” Florida State University
2. Sloppy reporting on college tuition
3. Are central Florida schools flouting Florida law limiting test-prep?