The Ongoing Inflation of the Higher Education Bubble

Political Calculations / Townhall Finance

How much has the average cost of attending college at four-year degree-granting institution in the U.S. risen since the 1969-1970 school year?

For an American student who enrolled in a four-year college in the fall of 1969, the average they paid for their tuition, required fees, room and board totaled $754, which when we adjust for inflation be be in terms of constant 2011 U.S. dollars, works out to be the near modern day equivalent of $4,619.

But a student enrolling in the same kind of institution in the fall of 2011 for the 2011-2012 school year would pay $13,608. Nearly three times as much.

To get a better sense of how affordable, or rather, unaffordable attending college has become, we next calculated the percentage that the average cost of tuition and fees for college would consume of the typical income earned by American households:

In the chart above, we see that after holding basically flat from 1969 through 1982 at a range between 8.6% and 9.0% of the median American household income, the ratio of the cost of attending college with respect to that income began rising rapidly, with the cost of college having reached 26.7% of the American median household income in 2011-2012.

We also see that there would appear to be certain periods where the cost of attending college rose considerably faster than median household incomes, which we've shaded in the chart above.

Let's next look at how the cost of attending college has grown against median household incomes from 1969 through 2012:

Here, we see that there have been three major inflation phases for the cost of college: the first running from 1990 to 1994, the second from 2000 to 2003 and the third from 2007 through at least 2012 (and likely, the present).

We should note that each of these periods coincide with periods of recession or extended underperformance for the U.S. economy. But what is perhaps more remarkable is that we do not observe the same pattern for earlier recessions, the major years for which we've also indicated on this third chart.

That's largely the role of increased government subsidies for higher education after 1989, in the form of grants and guarantees for student loans, which enabled colleges to continue jacking up their prices well above what a typical American household could afford to pay, because now Uncle Sam is increasingly stepping in to pay a growing share of the bill.

 

References

National Center for Education Statistics. 2012 Digest of Education Statistics. Table 381. Average undergraduate tuition and fees and room and board rates charged for full-time students in degree-granting institutions, by level and control of institution: 1969-1970- through 2011-12. [Excel Spreadsheet]. NCES 2014-015, December 2013. 

U.S. Census Bureau. 2013 Current Population Survey. Annual Social and Economic Supplement. Table H-5. Race and Hispanic Origin of Householder--Households by Median and Mean Income: 1967 to 2012. [Excel Spreadsheet]. P60-245, September 2013. 

Bureau of Labor Statistics. Consumer Price Index - All Urban Consumers. U.S. City Average, All Items, Not Seasonally Adjusted.Online Application]. Accessed 8 March 2014.

If the goal is “energy independence,” what issues should be a priority in America?

Marita Noon  / Townhall Columnist

Recently the Democratic Congressional Campaign Committee (DCCC) sent out a “2014 Priority Issues Survey.” In addition to the obligatory Tea Party bashing: “help the Democrats protect the progress we have made from Tea Party radicals, deliver the positive changes America needs and help Democrats win a Majority in the U.S. House of Representatives!” and the fundraising requests to “help protect House Democrats against Republican attacks”—there is a section on energy.

Section VII, asks: “Which of the following will help America achieve energy independence?” It offers five options that do little to move America toward energy independence—which isn’t even a realistic goal given the fungible nature of liquid fuels. Additionally, most of the choices given on the DCCC survey actually increase energy costs for all Americans—serving as a hidden tax—but hurt those on the lower end of the socio-economic scale the most. The proposals hurt the very people the party purports to champion.

The survey asks respondents to “check all that apply.”

-Raising gas mileage standards for all new cars and trucks
 
This choice presumes that making a law requiring something will make it happen. Sorry, not even the Democrats have that kind of power. Even the current Corporate Average Fuel Economy (CAFE) Standard of 54.5 miles per gallon (mpg) by 2025—finalized on August 28, 2012 and called “the largest mandatory fuel economy increase in history”—will be tough to hit.

The CAFE standards mean that a carmaker's passenger vehicle fleet average must achieve 54.5 mpg. To meet that, and produce the big pick-up trucks and SUVs Americans like to drive, the manufacturers must also produce the little itty-bitty cars with mpg above 60 and the more expensive hybrids (not one of which was on the top ten best-seller list for 2013)—or have a loss leader like the Chevy Volt to help bring down the average.

Suggesting a forced raising of gas mileage standards implies that auto manufacturers are in collusion with oil companies and are intentionally producing gas guzzlers to force Americans into buying lots of gasoline.

With the price of gasoline wavering between $3-4.00 a gallon, most people are very conscious of their fuel expenditures. If it were technologically possible to build a cost-effective truck or SUV that had the size and safety Americans want and that got 50 mpg, that manufacturer would have the car-buying public beating a path to its door. Every car company would love to be the one to corner that market—but it is not easy, it probably won’t be possible, and it surely won’t be cheap.

When the new standards were introduced in November 2011, Edmonds.com did an analysis of the potential impact: 6 Ways New CAFE Standards Could Affect You. The six points include cost and safety and highlights some concerns that are not obvious at first glance.

Achieving the higher mileage will require new technologies that include, according to Edmunds, “turbochargers and new generations of multispeed automatic transmissions to battery-electric powertrains.” The National Highway Traffic Saftey Administration and the Environmental Protection Agencyhave estimated that the average new car will cost $2,000 extra by 2025 because of the proposed new fuel-efficiency standards.

Additionally, new materials will have to be used, such as the proposed new Ford F-150 made with aluminum, which is predicted to add $1500 over steel to the cost of a new truck. Aluminum also complicates both the manufacturing and repair processes. Edmunds reports: “Insurance costs could rise, both because of the increased cost of cars and the anticipated hike in collision repair costs associated with the greater use of the plastics, lightweight alloys and aluminum necessary for lighter, more fuel-efficient vehicles. (Plastics, lightweight alloys and aluminum are all more difficult than steel to repair.)”

Another concern is safety. “The use of weight-saving materials will not only affect repair costs but could make newer vehicles more susceptible to damage in collisions with older, heavier vehicles, especially SUVs and pickups. Their occupants could be at a safety disadvantage.”

One of the subtle consequences of high mileage vehicles is the probable increase in taxes. Edmunds points out that lower driving cost may increase wear-and-tear on the nation’s highway system as consumers drive more freely. “Declining gas sales mean a further decrease in already inadequate fuel-tax revenue used to pay for road and infrastructure repair and improvement. … As more untaxed alternative fuels such as compressed natural gas and electricity are used for transportation, fuel tax revenue falls even farther. All of this is likely to lead to calls for a road tax based on miles driven and not the type of fuel used.”

Instead of increasing costs by forcing a higher mpg, a free-market encourages manufacturers to produce the cars the customers want. The Wall Street Journal story on the Ford F-150s points out: “In 2004, as the auto market soared, Ford sold a record 939,511 F-series pickups. That amounted to 5.5% of the entire U.S. vehicle market. But four years later, gas prices rose above $4 a gallon, sales of pickups began tumbling.” Then, consumers wanted small cars with better mileage. I often quote an ad for Hyundai I once saw. As I recall, it said: “It’s not that complicated. If gas costs a lot of money, we’ll produce cars that use less of it.”

In response to an article in US News on the 5.45-mpg CAFE standard, a reader commented: “ALL CAFE regulations should be repealed. Let the market and fuel prices decide what vehicles are purchased. The federal government should not be forcing mileage standards down the throats of the automaker or the consumers. This is still America, right?”

Sometimes a picture does say it all...

In the Latest Issue of Taliban Magazine …..
Pamela Geller / Atlas Shrugs

Here are the latest offerings from Obama’s “peace” partners (scroll). Despite their continuing war against America and their vicious, bloody campaign to impose sharia, Obama relentlessly stalks them for “peace,” handing over money, power, and mindless accommodation in exchange for humiliation, murder and mayhem.

Obama gave them legitimacy, and they repay every day him in blood. President Karzai confirmed that the Obama Administration actually told him that the Taliban, which provided al Qaeda its base of support for September 11, was not an enemy of the U.S. He said:

Last year, during my visit to Washington, in a very important briefing a day before I met U.S. President [Barack Obama], his national security adviser Tom Donilon, and senior White House officials, generals, and intelligence officials, the national security adviser met with me. He told me: “The Taliban are not our enemies and we don’t want to fight them.”

And therein is the Obama Doctrine: He is with them and against us. And his propaganda wing, the enemedia, rides shotgun in selling this unprecedented anti-American, anti-freedom policy of submission.

Taliban jihadists behead Afghan children, poison girls’ schools and slaughter our soldiers in green on blue attacks, target and AP journalists, slaughter Afghans who dare to attend a party where dancing takes place. Our soldiers are forbidden to criticize the Taliban, pedophilia, or “anything related to Islam,” or “advocate for women’s rights.” Barack Hussein Obama used the NATO summit to pressure Afghan leader Hamid Karzai to engage with greater urgency with the Taliban about a “political settlement” in Afghanistan.

Obama has declared that Afghanistan is a “major non-NATO ally.” The non-NATO ally declaration allows for streamlined defense cooperation, more money, expedited purchasing ability of American equipment, and easier export control regulations. And he has committed to more jizya for the Taliban.

Has Obama seen what the Taliban have run in a previous issue of their magazine, Azan?  http://www.theblaze.com/stories/2013/05/09/taliban-magazine-cover-says-obama-wanted-dead-only/

Florida: Judge blasts FBI for failing to produce records on Saudi family in touch with 9/11 hijackers that fled U.S. just before 9/11

Robert Spencer / Jihad Watch

 

 

Why is the FBI dragging its feet and not producing the requested records about this wealthy Saudi family? (Pictured is the home they abandoned suddenly just before 9/11 — a sumptuous mansion in a Florida gated community.) Could someone high up be implicated in some illegal activity? Clearly something is happening here, and we don’t know what it is. I expect that if a comprehensive history of the U.S. response to the 9/11 attacks is ever written, or ever could be written, it would contain more than a few surprises, if it revealed exactly why the U.S. government and the mainstream media has been so unanimously against facing the problem realistically and doing anything genuinely effective to defend basic principles of human rights, particularly the freedom of speech and the equality of rights of all people before the law. I expect it has more to do with stupidity than complicity, although in this particular case, there does seem to be more than a hint of a cover-up. In any case, I doubt that such a history will ever be written.

“Judge blasts FBI over Saudi family investigation,” by Michael Pollick for the Sarasota Herald-Tribune, April 4 (thanks to Kenneth):

A federal judge on Friday chided the FBI for failing to produce records tied to a prominent Saudi Arabian family who seemed to abandon their Sarasota home suddenly just prior to the 9/11 terror attacks.

U.S. District Court Judge William Zloch ordered the FBI to conduct a much more thorough search than it had previously done and deliver all pertinent documents — uncensored — to him by April 18 for review.

The judge said the FBI must comply using its most advanced document search system, called Sentinel, to search for records pertaining to a year-and-a-half old Freedom of Information lawsuit filed by the Fort Lauderdale news site Broward Bulldog. The Herald-Tribune Media Group joined the suit earlier this year as a “friend of the court.”

Under the judge’s order, the FBI also must search for documents related to the Saudi family, a home in Sarasota’s gated Prestancia subdivision and the investigation following the 2001 attacks using Sentinel and multiple other search systems.

The agency initially refused to search for the family’s names, claiming that would result in an invasion of privacy.

Judge Zloch ordered the FBI to also inform the court of any documented communications between it and other government agencies concerning the investigation.

That information, and an explanation of how the FBI is complying with the judge’s order, is due by June 6.The 23-page order Friday was Judge Zloch’s second in favor of the Bulldog and its editor, Dan Christensen.

In the latest order, Zloch takes the FBI to task for failing to exhaustively produce documents pertaining to the case.

He describes the agency’s initial search as “preemptively narrowed in scope based on agency decisions that categories of documents are exempt and thus, will not even be sought.”

He called one of the government’s characterizations of the Bulldog’s requests “literal to the point of being nonsensical.”

Tom Julin, the attorney for the Bulldog, praised the judge’s action.

“That is just exactly the kind of order a federal judge should render when the FBI refuses to acknowledge the existence of important documents like this,” Julin said. “I hope the FBI will follow his order to a ‘T’ and we will finally get to the bottom of this controversy.”

In joining the case in mid-March, the Herald-Tribune and the Miami Herald cited articles written about the Prestancia case and described ways in which a further search would be in the public’s interest.To date, the FBI has turned over 35 pages of heavily redacted documents — out of the 15,000 files it has acknowledged were part of its Florida inquiry into the 9/11 attacks.

Last summer, Zloch asked Julin to explain in writing how an FBI search could be done better. The FBI, the lawyer noted, did not even search for documents using the names of the family members residing in, or owning, the Prestancia home.

The home was owned by Saudi businessman Esam Ghazzawi and his wife, Deborah. Ghazzawi is known to have connections to the Saudi royal family.

For the six years before the terror attacks, the home was occupied by their son-in-law, Abdulaziz Al-Hijji, and their daughter, Anoud.

The Al-Hijjis came to the FBI’s attention after the couple apparently returned abruptly to Saudi Arabia two weeks before the attacks on New York and Washington, D.C., leaving behind clothes, food, children’s toys and cars.

Federal agents also linked phone calls from the Prestancia home — some dating to a year before the attacks — to known 9/11 suspects, the Bulldog has reported.
The calls were made to, or received from Mohamed Atta, fellow pilots and 11 other terrorist suspects, the Bulldog reported.

Atta and Marwan al-Shehhi had learned to fly at Huffman Aviation at the Venice Municipal Airport. Ziad Jarrah also took flying lessons nearby, at the Florida Flight Training school.

---

Security Expert: WTC Breaches 'Embarrassing'
Newsmax 

A leading security expert says his firm uses software that likely would have prevented three recent security breaches at the World Trade Center.

In September, three men parachuted from the top of the tower, the tallest building in North America. Then on March 16, a teenager climbed to the top of the building, eluding an "inattentive" security guard on the 104th floor, according to the Port Authority of New York. And on March 24, two CNN producers broke onto the site while covering a story. All three incidents led to arrests.

Richard "Bo" Dietl is a former NYPD detective and the chairman and CEO of Beau Dietl & Associates (BDA), a New York-based security firm. He is critical of security efforts at the WTC site, an area that has already been attacked twice by terrorists.

"There have been some pretty embarrassing breaches of security at this site," he declared. "We have been lucky that none of these people had been engaged in terrorist or criminal activities."

BDA has invested hundreds of thousands of dollars to develop proprietary software, "TrackNet," which keeps track of all security guards through a GPS system. It sends a message to a guard every 15 minutes to ensure the guard is responsive. It can also provide real-time intelligence to guards in the event of security concerns.

"I truly believe that had the WTC employed this type of security, their security program would have been more robust and these breaches would have been detected before occurring," Dietl said.

"We have the personnel and the technology to minimize any breaches in the security at the World Trade Center. Why are we waiting?"

Dietl was appointed chairman of the New York State Security Guard Advisory Council in 1994 and is a frequent contributor on Fox News.

He said his firm prefers to hire military veterans as security guards and pays them higher wages than average.

"What often comes into play is, 'I want the best security for the cheapest price,'" he said. "This is an oxymoron. You get what you pay for."

TEA Party Patriots Newsletter

Dear Patriot, This week, Tea Party Patriots announced some exciting events in April around Tax Day, the First Amendment carried the day in an important decision by the Supreme Court and the White House tried to claim victory on Obamacare of all things. Here are some things you need to know this week. Tea Party Patriots Tax Day Events The complexity, the extortion, the cronyism, the cost, the uncertainty, the corruption, the lack of transparency, and the targeting. The IRS is becoming more and more oppressive every day, and Americans can no longer trust their government to implement the tax code fairly and justly. Find out more information on two Tea Party Patriots events in April aimed at taking on Obama’s IRS… Read More> Freedom of Speech Wins the Day On April 2, the United States Supreme Court affirmed that the First Amendment right to free speech extends to political contributions. In McCutcheon v. Federal Election Commission, five of the court’s nine judges agreed to overturn aggregate limits on campaign contributions… Read More> It's Working...Against the American People Tuesday’s victory lap by the White House was peppered with arrogance and utter disregard for the majority of Americans who still oppose the Affordable Care Act – not to mention those who’ve been harmed by the law. Even though only of Americans support Obamacare, according to Associated Press-GfK survey, that didn’t stop the President from making the following strong-arm statements… Read More> Mexican Soldiers Crossing US Border Proves Need for Border Security On January 26, 2014, a “foreign military incursion” was reported and confirmed just 50 yards past the U.S.-Mexico border into Arizona. According to documents obtained by the Los Angeles Times, two heavily-armed and camouflaged Mexican soldiers crossed the borderand engaged in a tense, 35 minutes-long standoff with U.S. Border Patrol agents. Guns were drawn… Read More> Read Jenny Beth Martin's Breitbart Column Watching congressional Democrats and Republicans wrestle over the budget is a little like watching Thelma and Louise. Democrats want to stomp on the gas pedal and race to the edge of the cliff at top speed, while Republicans want merely to set the cruise control. Neither approach addresses the fiscal realities of the situation… Read More>