Monday, November 11, 2013

Price doesn't always reflect Value!

Weekly Opinion Editorial
by Steve Fair

     Last week, Oklahoma Speaker of the House T.W. Shannon, (R-Lawton) conducted an interim study on Oklahoma higher education.  One of the topics discussed was the affordability of a college education in Oklahoma.  In July, the Oklahoma State Regents approved a five percent increase to tuition and fees for college students attending state colleges and universities.  They cited record enrollment as an example that Oklahoma still has one of the best deals going when it comes to getting a college education. 
     Despite the increase, tuition at Oklahoma’s public colleges and universities still remains among the lowest in the United States. According to the U.S. Chamber of Commerce, Oklahoma ranks seventh in affordable college tuition and eighth in student loan debt nationally.  While it’s true that a college education is affordable in Oklahoma, an issue that should be discussed is the state’s poor graduation rate.  Once a person starts college, do they finish?  According to College Completion, Oklahoma ranks a dismal 41st in the US in graduation rates.  Only 45.4% of Oklahoma college students will graduate in six years.  OU has the highest graduation rate- 64%, OSU- 59%, Cameron, my alma mater, has the lowest graduation rate among state colleges-19%.

Three observations:

     First, college is not for everyone.  Students who do well in high school and on college entrance exams are much more likely to graduate college, but when more than half of the students starting never finish, it’s apparent that college could be a waste of time and in fact cost a student time and money.   While college students sometimes still gain marketable skills from partial attendance, others end up taking jobs that are often given to high school graduates, making little more money but having college debts and some lost earnings accrued while unsuccessfully pursing a degree. 
     Second, a college degree doesn’t always guarantee higher earnings.  The number of new college graduates far exceeds the growth in the number of technical, managerial, and professional jobs where graduates traditionally have gravitated. Now as a consequence, we have a new phenomenon in America: underemployed college graduates doing jobs historically performed by those with less education. We have, for example, more than 100,000 janitors with college degrees, and 16,000 degree-holding parking lot attendants.  Just because we go to college doesn’t always guarantee a high paying job.
     Third, higher education has become a business.  State colleges and universities should be run like a business, but these institutes of higher learning are more interested in selling more credit hours than training students.  According to Complete College America, more than 40% of incoming college freshman are taking remedial courses in college.  That means they are taking high school courses in college because they are not ready for college level classes.  If little Johnny can’t pass Algebra I in high school, then he is probably not a good candidate for college, but if a college can convince him he can take Algebra I again- at taxpayer expense- then it’s good for business. 
     More high school students in Oklahoma are going to college than ever before, probably because of Oklahoma’s Promise, the scholarship program that allows high school students from families whose annual income is $50,000 or less to earn free college tuition.  The program received $57 million of taxpayer money this year.  Over 20,000 students have benefited from Oklahoma’s Promise.  Because of the added students, higher education needs more professors, more buildings and more of your hard earned tax dollars.  Make no mistake about it; Higher ed is big business in the Sooner state.
     According to recent statistics, the value of the college earnings premium (the amount a college grad earns more than a high school grad- around $1 million) seemingly far outdistances college costs, yielding a high rate of return.
     The Oracle of Omaha, Warren Buffet said, “Price is what you pay, value is what you get.”  I’m not sure Oklahoma students and taxpayers are getting value from our state’s higher education system.

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