The American Spectator

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The average debt burden of graduating students at my school is about $27,000 -- but that figure applies only to the 64 percent whose financial affairs the school keeps minute tabs on. All the university knows about the remaining 36 percent is that full payment of tuition is somehow coming from them. My informal conversations with students leave me with the impression that only about half the students among the 36 percent come from parents and grandparents who can write checks for the full sticker price. The rest -- about a fifth of all the students -- carry the full burden, with colossal indebtedness and staggering personal sacrifice.

Of course, the easy availability of subsidized loan programs boosts indebtedness even more by pushing tuition higher, as the colleges discover more "costs" year after year. But the worst practice comes in the guise of philanthropy.

As economists have been saying for years (again to no avail -- another sign that much academic research is either useless or ignored), the practice of individually tailored aid packages is a form of price discrimination. Like other monopolies, the colleges are able to determine what an individual student will pay and to charge just that amount.

The practice could land an ordinary businessman in jail, but the higher education monopolists enjoy a special dispensation accorded them by liberal politicians. As tuition is inflated beyond most students' means, price discrimination gets more minute and intrusive and complex, pushing up administrative costs that help spark more tuition hikes, with the good intentions of redistributive financial aid dissolving into a languid sanctimony.

The students themselves, meanwhile, are dazzled and flattered by the attention they get with their elaborate financial aid packages -- beguiled as well by the dubious notion that the world owes them a living and that someone else should pay for the choices they make.

Perhaps the economists are being treated like Cassandras because runaway college tuition -- transparent in its causes and effects -- is not really an economic problem. It's a moral problem.

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