In our opinion: Reducing college costs

Published: Sunday, Nov. 13 2011 12:00 a.m. MST

College costs are out of control. Since 1985, college tuition and fees have risen more than 400 percent, far outpacing inflation

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College costs are out of control. Since 1985, college tuition and fees have risen more than 400 percent, far outpacing inflation. Families have dealt with skyrocketing college costs by relying on student loans. Two thirds of last year's college graduates accrued an average of more than $25,000 to complete their undergraduate degrees.

In order to understand a key but hidden reason why college costs are unbridled, we invite you to try the following thought experiment.

Imagine that over a generation ago, because of legitimate concerns about food safety, lawmakers made the following rule: To obtain and keep a restaurant license, a regional council of reputable chefs and existing restaurant owners would have to approve a restaurant's menus, chefs, wait staff, facilities and financing.

Although a system of expert peer review might indeed improve food safety, how would it affect your dining options? Would it generate a surplus of affordable and diverse options fitted to your taste and budget? Or would this system first meet the needs of established chefs and restaurants?

For those who love a variety of dining choices, a restaurant licensing system that focuses on health outcomes alone — instead of the wisdom of a guild of chefs — allows a wide variety of affordable restaurants to flourish based on how well an otherwise safe institution satisfies the wants and budgets of diners.

This thought experiment is not actually about restaurants. Rather, it is meant to shine a light on the workings of an obscure form of regulation in higher education known as accreditation, a system of entrenched peer review. Accreditation preserves time-honored methods but it also tends to shield colleges and universities from cost-saving innovation and competition.

In the United States, both the regulation of educational quality and access to federal funding at colleges and universities are effectively handled through putatively private but federally approved accreditation agencies.

Until the 1950s, accreditation was entirely private – a kind of "Good Housekeeping" seal of approval within higher education. But the federal government enlisted private accreditation agencies to ensure the quality of colleges and universities using G.I. Bill funds after learning that some veterans had squandered funds at fly-by-night "degree mills." And these now federally approved accreditation agencies became even more important when federal funding for higher education expanded with the Higher Education Act of 1965.

The amounts involved today are staggering. Last year, new federal loans to students at schools accredited by federally recognized accreditors totaled more than $124.8 billion and federal grants totaled more than $38 billion.

For reasons now largely forgotten, the six oldest and largest accreditors enjoy geographic monopolies in their oversight of colleges and universities and are known as regional accreditors.

The largely unquestioned power of the regional accreditors to certify colleges and universities for access to federal funds and transfer of student credit, coupled with their self-serving methods used to verify quality, means that most of American higher education operates like a guild —not a competitive market.

Guilds were those medieval institutions whereby government granted monopoly authority to a body of self-confirmed expert craftsmen to limit entry into the craft through long apprenticeships and peer review. And regional accreditors are effectively university guilds. They are governed by and for educational experts to sparingly dole out memberships. Only after rigorous self-study, peer review and lengthy periods of "pre-accreditation" can a college hope for membership. The practices that accreditors deem appropriate for higher education are determined by academic tradition, custom and practice.

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