Going to College & Grad School Looks Like a Disaster

By Nan Mooney, AlterNet. Posted December 2, 2008.

The good news is that schools are doing what they can to shore up resources and stem the panic.

"We're doing our best not to pass the budget cuts on to students," says Nancy Coolidge, a legislative and policy analyst in the University of California Office of the President.

The UC system foresees making major administrative cuts, putting off building and maintenance projects, and freezing faculty and staff salaries rather than reducing financial aid.

"There will be a tuition increase," says Coolidge, "but one-third of that is automatically recycled as need-based aid. We'll also stagger the tuition hikes so lower-income students aren't hit as heavily."

Like Hurley, Coolidge says the major challenges now will revolve around how to accommodate the increase in students without reducing the quality of their education experience.

The federal government has also stepped in to help. In September, Congress passed the Ensuring Continued Access to Student Loans Act, authorizing the government to buy federally guaranteed loans from lenders unable to meet them through the 2009-2010 school year. The idea is to encourage both large lenders, some carrying billions of dollars in student loans made before the financial crisis hit, and smaller nonprofit lenders to stay in the student loan business. The bill also extends the cap on the amount students may borrow, from $23,000 to $31,000, making it less likely they'll have to turn to the volatile private market to secure loans.

But despite the efforts of the federal government and the schools, the economic fallout is already trickling down to the students. The California State University system -- the nation's largest, with nearly 450,000 students -- has announced plans to trim 10,000 students in the coming school year due to funding problems. It will make the cuts by moving up application deadlines and raising academic standards for incoming freshmen.

What else might this mean for the college admissions process? It could signify a turn back toward the time when college was the province of the wealthy elite. Financial belt-tightening will eventually lead to the end of need-blind admissions policies in all but the wealthiest schools. Therefore, students whose families can pay the full cost of tuition will have an advantage. It also means that fewer institutional grants will be available, forcing more students to turn to loans to cover the full cost of college, even as fewer loans are available. Again, the less money an applicant needs, the more likely he or she will be able to swing college financing.

"Our concern now lies less with current students, whose loans are secured, than with prospective students," says David Levy, director of financial aid at Scripps College, a private school in Southern California. "We worry that, hearing about the financial crisis, they'll disqualify themselves from an education by not applying for financial aid or not applying to college at all. If parents know that schools cost more and that there's less money available, they may decide not to send their kids."

It also means that we will take a serious detour on our path toward becoming a country that provides an education to anyone who wants one.

"We simply don't have the resources to meet the demand," says Hurley of the California community college system. "And that's extremely troubling. If we don't have an educated workforce to deal with this economic crisis, it's going to present a real problem down the line."

For students who do find a way to pay, such financial pressures mean the college experience itself is likely to change. Hiring freezes and layoffs will result in higher student-teacher ratios. Money will be drained from facilities maintenance and improvement to cover gaps in financial aid. More students will have to work to supplement their aid packages, meaning less time for college life. Despite the rapid rise in tuitions and student loans visited upon college students of late, we may find ourselves looking back on recent decades with a wistful sigh for the good old days.

See more stories tagged with: student loans, higher education, financial aid, tuition fees

Nan Mooney is the author of "(Not) Keeping Up with Our Parents" (Beacon, 2008). Read more about the book and her work at Nan Mooney.com.

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