Why Don't Poor People Get College Degrees?

By Richard Vedder

On the Spellings Commission, it became an article of faith that high costs of college were a major barrier to low income access, and that access is declining as costs rise. Thus we push, successfully, for bigger Pell Grants. My Commission colleague (and now friend) Bob Zemksy tended to civilly dissent from that view, citing some evidence of his own from Pennsylvania.

I am increasingly coming to the view that Bob is largely right. While rising college costs is a huge problem to society, the negatives in terms of barriers to access are somewhat overrated. That view was strengthened by the September 2007 issue of Postsecondary Education Opportunity. While Tom Mortenson' preaching on access issues sometimes drives me crazy, his numbers are great. (Tom believes the evil taxpayers and politicians are denying poor people access, but he never has a negative word to say about what he no doubt perceives to be sainted, selfless and public spirited universities whose falling productivity is just a fact of life).

New data that Tom provides shows that in 2006, 12.1 percent of those in the lowest income quartile had obtained bachelor's degrees by the age of 24 --almost exactly the same proportion as in 1970. The inference is that college graduation is becoming a status reserved mainly for the affluent --or at least the non-poor. And the stagnation in that statistic is a legitimate cause of concern for those believing in the American egalitarian ideal.

At the same time, however, the percent of those in the bottom quartile attending college has risen sharply, from roughly 25 percent around 1970 to over 40 percent today. While participation has gone up for all groups, the percentage increase (both absolutely and relative to the 1970 participation rate) is greatest for this income group. Rising college costs have been accompanied by healthy increases in higher education participation among the poor.

What we see, then, is this: more poor go to college, but no more poor (in a relative sense) graduate. Another way of putting it is that the college success rate (graduation rate) among the poor seems to have fallen rather sharply.

This result, then, seems consistent with findings of individuals as diverse as AEI scholar Charles Murray, Rutgers sociologist Jackson Toby, South Carolina's intrepid educational research Harry Stilles, and myself: many kids who go to college are unprepared. As we try to increase the proportion going to college, we are increasingly enticing kids who have a low probability of success, in some cases because of lack of cognitive skills (Charles's point), in some cases because of messy and time-consuming family responsibilities, and, yes, sometimes for economic reasons. But money and "access" are not the main problems. Lower income kids are trying college out more than ever --with decidedly mixed effects.

I have always been willing to use some charitable funds unproductively to give everyone a chance at college, in keeping with the American Dream and egalitarian principles. But there are limits. Are we willing to spend billions if it results in just one more poor kid graduating? Cost-benefit calculations apply here as in almost any decision involving resources.

Mortenson also reveals a larger proportion of Pell Grants now go to support community college attendance --which, I think, he views as retrogression, but which I view as good. Give kids whose academic profile (which often correlates highly with income) is weak a chance by sending them to instruction-intensive but low cost community colleges before sending them on to the residential university/country club four year college setting which is quite costly to society.