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Undergraduates with family income below $200k will be tuition-free at MIT

(news.mit.edu)
589 points gnabgib | 4 comments | 20 Nov 24 16:59 UTC | HN request time: 0.845s | source
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TheJoeMan ◴[20 Nov 24 19:26 UTC] No.42197249[source]▶
This is a great step in the right direction. I can't speak directly for MIT, but there are issues with how these programs don't apply to parents with small family businesses. My parents had a small business, with my father taking home a salary of $XX,XXX. Duke University used the business assets to determine the EFC (expected family contribution) of literally 90% of the salary. Essentially saying to sell off the family business for the college fund, which was a non-starter.

Small businesses are allegedly the backbone of America, and I feel these tuition support programs overlook this segment of the middle-class.

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nuancebydefault ◴[20 Nov 24 20:53 UTC] No.42198000[source]▶
Why are such things in the US so complicated? Where I live, studying is much much cheaper for most professions,for everyone!

That's the only fair way. Also, a set of well educated people pays itself back later in the form of mostly income and added value taxes, which provides money to keep studying for cheap for the next generation.

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Nifty3929 ◴[20 Nov 24 23:08 UTC] No.42199099[source]▶
Because the US government will loan people very large sums to attend, which allows the universities to raise prices at will. The buyers are price-inelastic, which means that they want to go regardless of price, because they are surrounded by people that tell them that going to college is the right thing to do - and the more prestigious the better.

College in the US would be a lot cheaper if the government didn't inflate it. If you go back in time just a few decades, this is how it was: you paid for it, either in cash or with a PRIVATE loan, and people didn't see college as an automatic requirement. Then it was 1/10th as expensive.

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burroisolator ◴[21 Nov 24 01:46 UTC] No.42200218[source]▶
This is a common myth. This might explain why Harvard or MIT tuition is high but not the average college. Tuition mostly reflects staff costs and those have been going up due to Baumol's cost disease. Dentists, along with many other industries with its main cost being highly educated staff that haven't managed to scale production like online brokerages, have had a similar price increase since 1970.
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1. adastra22 ◴[21 Nov 24 01:57 UTC] No.42200286[source]▶
You’re going to have to qualify where you are talking about. Where I am, California, that only describes community colleges. Even state and especially UC have “invested” significantly in infrastructure improvements paid for with loans backed by expectations of tuition income, which has had an absurd effect on growing tuition far outside of inflation. Very little of your tuition at these schools goes towards teaching salaries.
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2. vitus ◴[21 Nov 24 02:18 UTC] No.42200414[source]▶
> Even state and especially UC have “invested” significantly in infrastructure improvements paid for with loans backed by expectations of tuition income, which has had an absurd effect on growing tuition far outside of inflation.

What timeframe are you looking at?

Back in 2011, registration fees at UC Berkeley were $7,230 per semester, with $813 allotted to health insurance (which could be waived if you provided proof of existing insurance from your family), so $6,417 ignoring health insurance. Meanwhile, last year, registration fees were an eye-popping $9,847 for new students, but cost of health insurance grew much faster to $1,929 ($7,918 ignoring health insurance). This is about a 23% increase, compared to CPI-measured inflation of about 35% between Sep 2011 and Sep 2023.

(The next biggest driver of the overall increase was the campus fee, which went from $253 to $820.)

Or, if you look at just tuition alone, that went from $5610 to $6261, or just barely above 10%.

https://registrar.berkeley.edu/wp-content/uploads/2021/03/Fe...

https://registrar.berkeley.edu/wp-content/uploads/fee_schedu...

If you look further back, in 1999, tuition was a mere $1543, but I posit that tuition at UCs has actually been fairly stable over the past decade.

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3. adastra22 ◴[21 Nov 24 02:40 UTC] No.42200542[source]▶
Those are some cherry-picked numbers. Tuition went up A LOT just prior to your starting point, 2011, as the great financial crisis made renewing those loans I mention much more expensive: https://ucop.edu/operating-budget/_files/fees/201415/documen...
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4. vitus ◴[21 Nov 24 03:40 UTC] No.42200872{3}[source]▶
> Those are some cherry-picked numbers.

I don't disagree, but they support my point that tuition has not changed meaningfully in the past decade (and then some), which is why I asked what timeframe you were looking at.

Inflation is perhaps not a good point of reference anyways, since in 2009, inflation per CPI was actually slightly negative. Cost of borrowing is not the same as cost of goods and services or cost of labor, for reasons such as the ones you point out (changes to banking regulations, increased risk aversion, etc).

Although, I'm a little surprised that cost of borrowing would have been much higher, seeing as that was the start of the zero interest-rate policy in the US. The average 30-year fixed mortgage rate was hovering around 6-7% pre-crisis and 4-5% in the years immediately following it.