Is Federal Financial Aid to Blame for Escalating College Tuition?

The role of nearly unlimited federal financial aid rarely receives any attention in the current debate over the causes of skyrocketing college tuition. Very few students, or their parents, are able to pay tuition costs out of pocket anymore. Many private schools now charge between $30,000-$50,000 a year. Even at a number of state schools tuition and fees now hover around $20,000. Since most college students do not come from families blessed with thousands of dollars in extra cash, most end up having to borrow money. According to the New York Times, the average student loan debt for all borrowers was over $23,000 in 2011. The problem does not appear to be improving either. CNN Money reported in April 2011 that tuition and fees at public universities rose over 8% for the year, as college costs continue to climb well ahead of the average rate of inflation.

One has to wonder if students would be burdened with such an incredible amount of debt if the federal government began to place strict limits on the amount of financial aid distributed each year. What if undergraduate students were no longer eligible for anything more than $4,000 for an academic year (maybe $6,000 for graduate students)? Schools that are charging $20,000 a year, or more, for tuition would have to make some major adjustments. In fact, tuition would have to go down. In addition to that, there are tuition assignments that are equally stressful for students. And in order to complete these assignments to get good grades, they have to do research and surveys that are equally expensive increasing their college expenses furthermore. 

A debate about reducing federal financial aid would raise an interesting discussion at the federal level about why college costs have increased so much in recent years. We know that the extra money is not going into the classroom. A January 2009 story from U.S. News amp; World Report confirmed that average annual expenditures on instruction and classrooms have gone flat, and even declined at many schools in recent years. Instead, it appears that many schools are charging such elevated tuition rates simply because they can. Tuition money paid by the federal government brings in additional revenue each year for schools to finance the construction of resort-like amenities for students, the expansion of administrative offices and an increased number of six-figure salaries for various high-level bureaucrats on college campuses.

Colleges continue to increase tuition because they know that the federal government will cover the amount that families are not able to pay in the form of federal student loans. Unfortunately, colleges and university leaders often use tuition money to finance projects and positions that have nothing to do with classroom instruction or student education. An end result is an increasing number of students graduating with obscene amounts of student loan debt, that hinders their economic opportunities and life choices for years to come. Something has to change.

It is time to take a long hard look at adjusting federal financial aid policies in order to curb the escalating costs to attend college.


Catherine Han founded Murals Plus in 2017 and is currently the managing editor of the media website. She is also a content writer, editor, blogger and a photographer.

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