May 7, 2004


The In-Crowd

By Robert B. Reich

It’s an economy where educational credentials and connections count for more and more. A degree from one of the Ivies or from a Stanford, Michigan or Berkeley isn’t exactly a bus ticket to fat city—but it sure helps. At the very least, you need a bachelor’s degree just to get on the highway.

But fewer and fewer young people from lower-middle income (what we used to call “working class”) and poor families are enrolling. At Harvard, for example, a scant 13 percent of undergraduates are from families earning less than the national median of about $53,000 a year. Across America, a quarter of high-achieving poor kids who are fully qualified to attend college are opting out.

What’s going on? For one thing, tuition keeps going up. That wouldn’t be a problem if universities and the federal and state governments kept giving scholarship aid to kids of modest means. Yet so-called “merit-based” scholarships are all the rage now. Private universities are paying out about $4 in scholarships for every $10 they take in as tuition revenue, but two-thirds of this aid is based on test scores and grades—not on need. Public universities are following the same trend.

The reason is, universities are competing for academic stars. Competitive rankings in college guides are based largely on the grades and test scores of entering freshmen. High rankings help universities attract more and better applicants—and more donations. So, increasingly, universities are using merit scholarships to lure high school seniors with the highest grades and test scores. This means less scholarship aid for qualified applicants who need the money in order to attend.

The trend is made worse by state governments pulling the plug on higher education. This year, due to budget cuts, the university of California system turned away 8,700 qualified applicants from lower-income families. In prior years, they would have been accepted.

The federal government is also cutting back on college aid. A quarter-century ago, federal Pell grants covered more than 80 percent of public-college tuition for children of modest means. Now, Pell grants go only 40 percent of the way. Federal tuition tax breaks don’t help. They go mainly to affluent families that pay the most taxes. As a result, the federal government is spending about $10 on upper-income students for every new dollar it spends on the poor.

At a time when the gap between America’s have-mores and have-lesses is wider than it’s been in a century, and when college is the gateway to upward mobility, we should be making it easier for kids of modest means to get a university degree. Instead, it’s becoming harder. And that’s a national shame.

Robert B. Reich is the Maurice B. Hexter Professor of Social and Economic Policy at Brandeis University, and was the Secretary of Labor under former President Bill Clinton.Reprinted from

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