The Uncharity of College: The Big Business Nobody Understands
Author here. Another long read -- apologies!The TL;DR of this essay might perhaps be:- College degrees are more valuable than ever in post-industrial economies, so applicants to top-tier schools are up 240% over the last 25 years- Meanwhile, available spots at top-tier colleges in America have increased just 2% over the last 25 years (Thanks to Tyler Cowen & others for complaining about this publicly)- Microeconomics 101: Fixed Supply + Increased Demand = Increased Price- That’s the obvious part- The non-obvious part is that this is intentional...- ...because the Charity-status ( 501(c)(3) ) of Colleges in America depends on more-than-half of their students being unable to afford the education (read: “receiving financial aid”)- That Charity-status protects the Investment Returns of College Endowments from Uncle Sam & the IRS- Investment Returns Compound over time, and there is no more powerful force on Earth — anyone not playing the game to maximize Compound-returns will lose to everyone who is- Thus: if Colleges want to keep their Investment Returns tax-free, Tuition MUST remain unaffordable for at least 50% of undergrads