Ric Reveals the Biggest Scam in Higher Education
In-state students are more likely to be rejected than those out-of-state
Ric Edelman: And if you want to talk about the biggest scam in higher education, it's the following: what you pay to go to college depends on where you live. If you go to a state college or state university, you'll pay three times more than other students if you don't live in the state of the university itself. This is a big deal because, as you're looking to go to school, are you going to choose an in-state school or are you going to go to an out-of-state school? You pay three times more to go to an out-of-state school than a resident of that state. You might say, look, you know, I understand that, I'm fully aware of it. I live in Virginia, but I prefer to go to the University of Pennsylvania. Well, that's a personal choice. You realize it's going to cost you more. But here's the thing. You might want to go to the University of Virginia, but the University of Virginia won't admit you. Why? Because state schools admit more students who live out of state than they admit who live in state. And this forces students to choose out-of-state schools, even though they would really rather not. South Carolina has the University of South Carolina. It also has Clemson. Only half of Clemson's students are in-state. At Purdue, only 45% are in-state. There are 36,000 students who live in California who go to school in other states. 32,000 who live in Illinois, who go elsewhere. 31,000 who grew up in New Jersey, who go elsewhere. It's causing students nationally to spend $52 billion on extra tuition costs.
Ric: To me, it looks like a cartel. All the universities in all of these states all agreeing on the same thing: we're not going to allow our residents to get admitted. That will force them to go to your school in your state. You do the same thing and send your students to our state. And all of these universities all over the country earn massively more tuition revenue than if they simply all taught their own local kids. I mean, think about it. Why would a kid growing up in Pennsylvania choose to go to UVA when a kid growing up in Virginia chooses to go to the University of Pennsylvania? If it's good enough for one of them, it's good enough for both of them. We should be telling our students: you're going to go to college where you live. And for parents who take the attitude: but my state doesn't really offer all that great a set of higher ed options, then move. It’s as simple as that. Parents routinely move to a town because the schools are better. Well, you shouldn't just do it for K-12. You should do it for higher ed as well.
Ric: We're talking about hundreds of thousands of dollars in tuition expenses based on where the child lives. It's a scam in higher ed, the biggest, most expensive, and it's astonishing to me that it's permitted. You need to be aware of it, so you don't allow it to occur.
Ric: Fortunately, one school is doing something in the right direction: Princeton University. It costs $80,000 a year, $300,000 over four years. Princeton is now paying the full cost of college for every student whose family earns under $100,000 a year. Princeton's got an endowment of $37 billion, and they're actually beginning to use the money for the right way and the right reasons. This needs to be adopted by universities across the country. And by the way, if Princeton recognizes that it's only families who earn under $100,000 who need financial assistance, why is President Biden's loan forgiveness dealing with families of $250,000? Something for us all to be thinking about, especially those occupying the White House.