A News Blog item about a letter Charles Miller, the former chairman of the federal Commission on the Future of Higher Education, sent to the College Board — accusing it of acting like a “cheerleader” for higher education — got plenty of comments from readers.
In response to the letter, Sandy Baum, a senior policy analyst at the College Board and an economics professor at Skidmore College, wrote:
The College Board’s 2007 report, “Education Pays,” carefully documents both the monetary and the non-monetary returns to the investment in higher education for individuals, as well as for society as a whole.
Charles Miller’s letter to Gaston Caperton correctly points out that many observers exaggerate reality when they claim that college graduates earn a million dollars more than high-school graduates over their work lives. Our report does not make that error. Using assumptions that are much more reasonable than those Mr. Miller suggests, we estimate that the earnings advantage of the typical four-year public-college graduate has covered the cost of tuition and fees, interest on loans to cover those charges, and four years out of the labor force within approximately 11 years after graduation. The higher tuition at private colleges adds about seven years to the break-even time. These calculations would be even more favorable if they took into account the reality that most students receive grant aid to defray part of their tuition costs.
Mr. Miller makes a serious error in suggesting that a college degree is not worth the price for the typical student. The careful calculations in our publication, in addition to extensive analytical work by numerous highly respected academic economists, indicate a very high rate of return on average — both monetary and non-monetary — to both individuals and society as a whole from investment in higher education.
We share Mr. Miller’s concern over increasing access to college for low- and moderate-income students. We agree that both more-effective action by institutions of higher education in reducing the cost of providing quality education and reform of the student-aid system to make it simpler, more efficient, and more equitable are vital to reducing the financial barriers to college opportunity, which are also described in the “Education Pays” report.