A Facebook correspondent responds to my reaction to The New York Times:
While I agree that more more money chasing “product” tends to inflate the cost of that product, I think there are other large drivers of college tuition. Looking at a graph (which I don’t have at hand, sorry) of general inflation (e.g. CPI) over the past 4 decades versus the cost of health care versus the cost of tuition is rather revealing. Any personnel-intensive industry with well-compensated (i.e. including fully-insured) people is going to see its costs go up with the far steeper than inflation curve belonging to health care costs. (This problem is eating government, too.) But universities have managed to exceed even health care’s curve by as large a gap or scaling factor as it exceeds general inflation.
So I guess I’d say, I agree with you and I agree with the NYT at the same time — and throw in health care to boot.
I just see the excess funding provided by the cheap loans as the enabler of all of this.
