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Universities Could Have Lowered Tuitions—but They Didn't

Online courses gave them the chance
By Neal Colgrass,  Newser Staff
Posted Apr 14, 2019 2:20 PM CDT
Updated Apr 21, 2019 7:33 AM CDT
People walk on the Stanford University campus in Palo Alto, Calif., in this file photo.   (AP Photo/Ben Margot)

(Newser) – Think college debt is killing America? Then consider how universities missed the chance to lower tuitions—by hoarding a secret windfall and giving the rest to companies you've likely never heard of, HuffPost reports. Called "online program managers," or OPMs, the companies create online courses for such prestigious colleges as Yale, Harvard, UC Berkeley, and USC. They also take 60% or more of the tuition, even though online courses are cheaper to run and can host thousands of students at once. A good example is the company 2U, which creates online-course software, hires adjunct professors, and assumes all the financial risk. Colleges enjoy their cut, but students get nothing: USC's master of social work costs the same $107,484 online as it does in class.

One issue is whether OPMs are exploiting the public dollar. Authorities have cracked down on college misconduct before, like abuses around the 1944 GI Bill and the brazen recruitment of anyone who could "breathe [and] scribble his name" to for-profit schools before 1990. The Obama administration also got involved by strengthening regulations against schools sharing tuition revenue, but 2U convinced them in 2010 to change their mind. Now the Trump administration appears ready to further loosen the rules. The prize: access to a higher-education market estimated at $300 billion. Amid all this, 2U founder John Katzman has launched a new startup to create online courses at nearly half the going rate, per Inside Higher Ed. But can he guarantee tuition will go down? "No," he says. "That's way over my pay grade." Click for the full article. (The 10 states with the most student debt.)

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