MATHEUS FALCAO, NILOUFAR SAYYADI, JACOB TANTI, HAROLD PIJPELINK, FILIPPE SILVA THE ECONOMIC CRISIS IN AMERICAN HIGHER EDUCATION

INTRODUCTION The crisis in a nutshell Causes for rising tuition fees Solutions to solve the crisis

ARE YOU BETTER OFF?

STATE BUDGET CUTS State budget cuts due to recession Direct effect on tuition cost Less State money than before recession Some states still lower budget yearly

STUDENT LOANS AS “FINANCIAL AID PACKAGES” The growth of student debts Poor students Time to pay

FINANCING COLLEGE More government money State money (Proposition 30) Federal money (Pell Grants) Income share agreements with companies A less demanding loan forgiveness program A more inviting job market

SPENDING FOR STUDENT LUXURY FACILITIES The symbolism of this is worse than the reality of it Investments in pools and gyms generally don’t have a positive effect on enrollment Campuses that make large investments in new facilities, usually have existing facilities that are in need of repair The big problem that higher education faces today is at the public side.

SPENDING IN ATHLETIC PROGRAMS College sports generate high revenue Less than 4% of the Athletic Programs are self- supporting Coaches at state universities are the highest paid public employees in most states Transfer from tuition revenues to athletics departments to fund deficits Students pay directly through special fees The greater the deficits of those athletics departments, the higher the tuition and fees must rise

STOP THE SPENDING Less focus on revenue Budget cuts all across the board Cultural change: a more frugal college More corporate sponsoring Government cap on private lending

RECAP 1.Tuition increases are not sustainable 2.Solutions are limiting loans and frugal spending 3.We need to change the way we look at college

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