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American Colleges: A Money Machine disguised as an Education System | Online College Classes – Distance Education
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American Colleges: A Money Machine disguised as an Education System

Anytime you have people with power over others on a very large scale, corruption of some form follows. American colleges and universities have hidden their profit machine behind the “importance” of education for far to long.

Don’t get me wrong, education is very important. A college degree is still a major accomplishment and should earn the recipient more income over their lifetime than a person without. We still and always will have professions were college is required to learn the needed skills to perform the job, ie. doctors, lawyers, teachers, etc. In time, colleges have found creative ways to increase their bottom line by taking advantage of students  who want or need  a receive a degree.

The world is simply a different place than it was 10-20 years ago or even longer.  Throughout history, upper level education was provided to a select few, usually the rich and priviledged. When everyone has a degree, the degree  distinguishes you less compared to those without, than it did in the past. It’s basic supply and demand. Those who earned college degrees from 1940-1990 had a major advantage over their competition. Since the majority of citizens didn’t attend college, these degrees had much more value as a whole. People began to see the importance of a degree and loan sharks began to make it possible for everyone to attend for a price.

Real Life Example: A friend of mine graduated from a 4 year state univeristy with a degree in elementary education in May 2009. Her graduating class had nearly 60 students receive the same degree. In December if 2009, another class graduated with close to the same # of students. Our county of roughly 90,000 citizens has close to 60 elementary schools, charter schools, and private schools for these new elementary teachers to apply at.  My friend was one of the lucky 20 or so graduates from her class to get a job as a first year teacher. That’s 20 job openings for over 120 graduates. Since a  public school year runs from August-June, this means yet another  class will graduate in May 2010 and 60 more students, or 180 total looking for a job that isnt there this August. The sad thing is that this is only counting students graduating from a single university, we have 3-4 smaller colleges in the county that will only double these #’s. As many as 65% of these graduates are 22/23 yeas old, in debt  and have a piece of paper saying they are qualified to work a job that simply isn’t hiring at the rate of degrees being attained and never will be. This doesn’t mean the degree is worthless by any means,  having a degree at all says something about one’s character and abilities. The real issue is that we end up with 100 teachers in 1,000 teaching while the remaining 900 take other, usually less paying  jobs from those without a degree at all over tmie.

Admissions

The first step in the college process is applying and being admitted into the school of your choice. A quick search of the internet and various universities show that the application fee of most schools will cost between $30-$70 with an average of around $40.  This is usually a non-refundable fee.  Many schools will charge additional  fees to send or recieve transcripts as well. None of these fees guarantee you admission, this is just the cost of them evaluating you. Though it varies from place to place, large state schools accept around 45% or less freshman applicants per year.

Real Life Example: In the state of Florida from 2005-2008, the major 5 public universities (Florida, Florida State, Florida International, UCF, and USF) have each decreased the % of admitted students each year, with the total # of applicants has increased slightly yeach year, In 2008, the freshman acceptance rate for these 5 schools combined was less than 38%, down from 52% in 2005. In total, 1,300 less freshmen were accepted, while nearly 15,000 more applied in 2008 than 2005.

Hyperinflation of College Tuition

From 1978 to 2008 the cost of living has increase 3 fold, medical cost have increased 6 fold, yet college tuition has increase an amazing 10 fold in only 30 years. Colleges have increased tuition costs an average of 4% each year duing this time. It costs nearly 3.5 times as much to attend a private school than a public school, which is the largest markup in history. In 2008, a study was done by NPSAS that concluded the median cumulative debt for graduating with a 4 years degree is $19,999. One in four borrowed $30,000 or more, while one in ten borrowed $45,000 or more.

As quoted from Wikipedia: “A generation ago, students could easily pay for public universities without student loans, simply by taking a part-time job. Students today are an exploited minority, being taken economically taken advantage of because they lack the historic perspective to appreciate the inequality.”

When the economy is booming, private schools raise tuition and when tax breaks are given the public schools follow. Just recently our president has made attempts to give students cheaper more affordable ways to pay for college and the schools are raising tuition in tune, yet again. What’s in place to stop them? Students get $1,000 loan, they charge $1,000 if students can get $2,000 loans, they will charge $2,000.

Transfer Credit

Many school do not allow students to transfer all previous credit into their degree programs. A common practice is to disallow previous core classes to count as core classes, but  allow them to count as elective credit. Schools sometimes don’t accept common credit from institutions located just miles away who are accredited regionally or nationally. Every class you take, every extra semester you are there,  is more money for the school. It benefits them to allow just enough credit to keep the student interested in the school, but not so little that the student will apply somewhere else where they may accept more transfer credit.  Some schools are better than others, no question. Professors, facilities, alumni, and prestige give a school the right to charge more or less for their services. Blatant refusal to accept valid transfer credits from qualified institutions is one of the biggest scams going. If they deny you 1 class, thats $300-$1000 you lose and they make.

Real Life Example:

Another friend had 80 hours of transferable credit, almost all in business related classes. A private school in Florida, who allowed up to 90 hours to be transfered in, would only allow 33 hours to be accepted. Of those, 21 would count towards electives. Financial accounting transfered in as financial accounting, yet micro-economics would be an elective credit and he’d have to retake micro-economics again at the private school for core credit. This same student applied at a 2nd private school (in the same athletic conference, with the same accredidation)  a month later and was approved for all 80 hours and was able to take classes for $150 less per class. Thats 47 more hours  for towards the same degree, and he’s saving another $3,000 in tution for the final 40 hours.

Falculty and Communication

Many colleges are so large that its almost impossible to get individual attention regarding questions or issues a student may face in a timely manner. Each conselor may have 100’s or even 1,000’s of students to advise in a given semester. While some schools offer great avenues for help and take advantage of new technology to do so, many contiune to be satisfied with the  statas quo. Students should not have to wait for hours to see an advisor or register for classes, then be treated as just another sheep in the flock. Colleges sometimes all to often forget that without the students, theres no money. Luckily for the schools, there seems to be an endless supply of sheep willing to take a gamble on this money machine diguised as an education system.

Real Life Example:

A local community college, Polk State College in Florida has 1+  hour waiting lines daily to see one of the few advisors available. Total enrollment is about 10,000 credit students (6,500 full-time) and 8,700 non-credit students, served by a staff of about 100 full-time faculty members. In 2009, they raised tuition costs by 16% after losing nearly a million dollars in state funding. In 2009, only 39% of their funds came from tuition. The state still pays 61%! The student body has grown over 10% for 4 straight years. This institution should be growing and profiting without massive tuition increases.

The following is from The Lakeland Ledger:

“PCC trustees will vote on the $33.2 million budget on Monday. The budget is about $1.3 million more than this year’s $31.9 million. It includes $2 million in federal stimulus money or non-recurring funds that will go toward hiring and maintaining the jobs of adjunct professors, Elliott said.

Money from the state decreased by $127,249 on top of $794,199 cut in January”

A closer look shows that they received 2 million from the Government one time, and will lose nearly a million in state funding per year…so because of this, they have an extra million this year and raised their costs 1.3 million. Meaning the tuition increases weren’t needed until the year following the government money in the first place. Seeing that 90% of the teachers at the school are/were adjunct professors  to begin with their salary should be covered by the old budget, plus the extra 4 years of 10%  more students attending. If they had 6,500 full time students now, 10% more next year would be 650 new full-time more students. 650 students times $2500 a year tuition is an extra 1.69 million dollars each year, which is over half a million dollars more than the funds they lost from the state. This total only includes 650 new fulltime students, not the extra part time students, not the extra parking tag revenue,  or even extra bookstore  revenue. It also doesn’t account for the new teachers they hire, or the new computers and equipment they need to accomodate these extra students. The bottom line is that this school, like so many around the country, charge the student double what the state takes away and results in a endless vicious cycle of higher tuition costs nationwide. But there’s more…

“One bit of good news for the school is that no layoffs are planned next year, Elliott said. Full-time positions remain frozen. It’s still unclear if raises will be given, but a $1,000 bonus given in December seems more likely, Elliott said.”

So if 100 full-time employees each get $1,000, that’s $100,000 spent. Now let’s say that the other 90% of non full-time employees also get the that same bonus, or a prorated version of it. Lets just say, it appears thats where the missing $300,000 or so ends up going. State cuts a million, government gives 2 million. We have an extra million left this year than last, so they up the budget 1.3 million…and amazingly the extra $300,000 goes mostly to bonuses. I am in no place to say whether any or all of these people deserve a bonus. Teachers are typically underpaid and most deserve more than they make. To increase tuition to every student a year earlier than needed to ensure a bonus isn’t right. Sounds alot like AIG and Bank of America doesn’t it?

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