Where Do Our Tuition Dollars Go?

NCPA April 3, 2015

Former university administrators Frank Mussano and Robert V. Iosue have signaled the need to bring information-liberalizing ideas into the education sector, with an emphasis on transparency in determining how efficiently schools are using tuition money. The pair's findings show that while teachers now work fewer hours than in the late 1980s, tuition has exploded by over 1000 percent.

The reason for these new costs? "Administrative bloat," which is also known as a decline in the teaching faculty to administrative staff ratio. Iosue and Mussano also say a "prestige arms race" is at fault for tuition hyperinflation. Universities attempt to attract applicants by building expensive amenities across campus, attractions which are eventually paid for by students and families.

Significant cost-related figures include:

• Over $10 billion in spending by universities on buildings alone;
• Student debt which has now skyrocketed past $1.2 trillion;
• Student loan default rates that are almost at 15 percent;
• And an explosion of college administrators…workers filling positions which have grown 50 percent faster than opportunities available to actual higher education teachers.

Mussano and Iosue point to the need for increased transparency and availability of information within the areas of student achievement, critical thinking and the university's finances. The two researchers claim with such data, both parents and the government would be able to audit universities more closely while having a better idea on each institution's return on an education. Mussano and Iosue argue many inefficient practices still plague the sector.

Source: Tom Lindsay "New Study Blasts College Tuition 'Deception,'" Texas Public Policy Foundation, April 2, 2015.