[Vedder]was struck by the fact that "nearly twice as many Americans think colleges 'are like most businesses' than believe 'colleges today mainly care about education,' " and that the proportion saying that colleges "care mainly about the bottom line" had increased to 60 percent from 52 percent in just two years.William Hoar cited Richard Vedder in an article in New American on the Scheme to Nationalize Student-Loan Industry:
"Once colleges were revered as selfless institutions trying to educate our youth and serve the public good. Now, apparently, universities are viewed as being somewhat akin to used car dealers, trying to shake down their customers for as much money as possible. In the long run, that is going to hurt a sector dependent on third parties for support."
Vedder acknowledged, though, that he has been surprised by the extent to which many Americans have continued to be willing to pay ever-rising tuitions. When he published his book in 2004, Vedder said, "I always thought there would be a threshold, where people get so angry that they start making different decisions, or that it gets in the consciousness of politicians. Neither of those has really quite happened," he said. Yet students have continued to flock into higher education, and -- defying logic, almost -- families have continued to appear willing to pay tuition at even the most expensive institutions.
"The bubble’s got to burst on this thing.... The staying power of colleges is amazing," he added.
"Americans," he said, "are still in the grin and bear it mode."
Dr. Vedder, director of the Center on College Affordability and Productivity and author of Going Broke by Degree: Why College Costs Too Much (AEI Press, 2004), further observed: “When the feds created tuition tax credits in the late 1990s, I called it the ‘faculty salary enhancement act,’ since colleges could capture much of the tax break by raising tuition fees and then used some of the money to reward their staff. Money moved as much from taxpayers to university staff members as to the pockets of student consumers.”Neal McCluskey cited Richard Vedder in a piece over at CATO.
Economist Richard Vedder has long educated people about the inflationary effect of student aid, and does so again with great clarity.Dan Lips cited Richard Vedder in a piece for National Review Online
As economists like Dr. Richard Vedder have argued, generous government subsidies have actually contributed to the college cost problem. Rather than continuing to follow this failed approach, the time has come for policymakers to solve the college affordability problem through strategies that can lower college costs.Daniel L. Bennett was quoted in a Fox 5 news story.
There is also an interesting argument going on -- that college tuition is experiencing a bubble, much like we saw in housing. The more loans that are available, the more money students have to spend. That, the theory goes, leads colleges to raise tuition and buy for all sorts of things that don't go directly to education.
"It's comparable to rearranging the furniture on the Titanic," says Daniel Bennett of the Center for College Affordability. "It makes it look nicer but it doesn't take care of the problem."
Bennett agrees with President Obama's statement that colleges need to do their part to bring down cost.