In a draft statement released to the media earlier this week, a group of private college leaders are calling on other schools to renew their commitment to need-based financial aid. According to The Chronicle of Higher Education, the document calls for doing away with the use of the phrase “merit aid” completely, saying that need-based aid will go further in helping schools attract talented students who come from low-income families.
The Chronicle explains that the statement – which S. Georgia Nugent, the President of Kenyon College, described as “a work in progress” – came about as a result of recent conversations between private college leaders on the topic of financial aid reform. The paper, titled “High Tuition/High Discount Has No Future,” says that the competition among colleges for a smaller number of qualified students means that more of the resources are being put towards merit aid, frequently for students who don’t require that much assistance in covering tuition.
According to analysis by Daniel Luzer of the Washington Monthly, merit scholarships have become one of the tools available to smaller private schools to attract candidates who might otherwise enroll in more selective colleges. But this practice has brought about an unintended side-effect: a quick upwards spiral in the cost of tuition and financial dealings that seem designed to conceal the true cost of higher education.
This is an understandable trend— U.S. News doesn’t give institutions credit for keeping education affordable, and it does families no good to pay more for college—but over the long run this results in an arms race of college spending, makes college more expensive, and disguises the real cost of college.
Luzer points out that without a standardization of the definition of “need,” smaller colleges are still poorly equipped to compete against their better-funded opponents. While a number of high profile schools now practically offer free tuition for students who are considered low income, the definition they use – a family earning less than $65,000 – might be unaffordable to a school in less secure financial position.
In general, however, this seems like a good idea. This is, after all, how financial aid used to work at most institutions. The school cost a certain amount, and most students paid that amount. For rich families, of course, it was easy; for middle class families it was hard, but still possible without going into debt. It was only the very poor who got scholarships to defray the cost of tuition
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