MIT: If you're family earns less than 75k per annum, tuition is free

Discussion in 'Economics' started by ByLoSellHi, Mar 9, 2008.

  1. I applaude this move. We need a meritocracy in the U.S. if we are to compete in a global economy filled with talented, bright and hungry competition, which we lacked for the better part of the post WWII era.

    http://www.nytimes.com/2008/03/09/education/09mit.html?_r=1&oref=slogin
    M.I.T. Cuts Tuition Based on Income

    By THE ASSOCIATED PRESS
    Published: March 9, 2008

    CAMBRIDGE, Mass. (AP) —
    The Massachusetts Institute of Technology says undergraduates whose families earn less than $75,000 a year will not have to pay tuition.

    The university says in its plan approved Friday that students will also not be expected take out loans beginning next academic year.

    The plan is the latest move by elite American universities to cut costs for middle-class families. It is expected to cover about 30 percent of the university’s 4,000 undergraduates.

    The university is increasing its financial aid budget by $7 million to $74 million a year, and students who have work-study jobs as part of their aid will work fewer hours.

    The school says tuition and fees will go up next year by 4 percent to $36,390.
     
  2. Pretty much every elite school has a system like this nowadays.

    Stanford recently announced the free tuition for students with family income less than $100k.

    All these universities have a huge endowment anyways.
     
  3. yes, with a student body less than 10,000 and an endowment of greater than 10,000,000,000, it doesn't matter whether the students pay tuition or not.
     
  4. It seems as if the elite schools are using this as a way to fend off government taxation or oversight for their wildly successful investment portfolios/endowments.

    I think it also is a recognition of the impossibility of repayment of student loans for many students who choose not to work on wall street or become attorneys / mba's.

    The most interesting part is that the plutocratic approach to ivy admissions is changing - its hard to say for certain without being there, of course - but it does seem that the old strategies for ivy admission are changing, and therefore, the selection of future 'elites'.

    It used to be that some attention was paid to the parent's ability to pay. Feeder schools - the elite private prep schools in the northeast - ensured a steady stream of matriculants. For the most part, this has resulted in a stream of children who have been selected based upon a meritocracy of their parent's wealth. (plutocracy by a stretch)

    However, this move may (or may not) represent a sea-change in selection criteria, where it becomes a true meritocracy, and not related to family wealth, etc... This would allow penetration of these smart kids (give 'em that, please) into public service or back into academia - professions that might have been closed to them if they needed to repay crushing $250,000 student loans. Consider that - four years of college without parental support, solely on student loans - $1500 monthly student loan repayment on a 30 year term! $18,000 a year requiring (@30% tax rate) a pre-tax income of $23,400 annually. And that's not for anything else but the priveledge of an education! How can anyone choose to do anything else besides a high-paying profession? Forget about public service - you would be living at near poverty wages.

    Somehow, I think this isa good idea. But I do think it will have significant effects on our elite 20 years from now. Probably a good thing.
     
  5. ammo

    ammo

    with rising educ costs and depleting middle class standard of living i doubt few of these loans will be paid on time ,majority not at all.
     
  6. How many students are in this category ? The costs of housing and eating are very real as well.....

    E Education...Internet based education is absolutely essential to all countries....

    The 2nd generation of the internet must make available equal and fair educations no matter where the student sits....

    The very same student could go to MIT....study the very same text.....and make the very same grade.....

    And at the end of the day.....the student who was labeled as a MIT resident will get the job over a non MIT resident....

    This is bullshit.....The job should be based on pure qualifications....not fraternity memberships.....

    To suggest that elimination of on site tuition is a step in the right direct....but is simply not efficient enough....and not fair enough....

    Also the financial coffers of MIT will dramatically improve....in that lots of smaller amounts of money....add up to lots more total money....

    MIT is simply a strong franchise.....Using the very same textbooks....one will pay a little more for an E education by MIT than a lessor franchise name....

    Educational facilities should compete against each other like any other business.....

    It is not right to make one child pay more than another....


    E Education is the correct solution.....
    ...............................................................................................

    The US has the best chance for structural change.....and will quickly become an unbeatable superpower with account surpluses if the following takes hold....

    E Education
    Eliminate the IRS....consumption tax only....
    Eliminate legal largesse
    Enhance Electronic stock exchanges
    Make medicine a non business
    E government...eliminate the sound byte commercial advertising system....

    Don't think so ?.... THINK AGAIN.....
     
  7. LOL!. And IF a frog had wings, he wouldn't bump his ass when he jumped.
     
  8. nitro

    nitro

    It is extremely interesting that schools are doing this. But let me tell you a small story.

    My next door neighbor works at Northwestern U as a financial aid officer. She says that more and more kids are taking out these huge loans, and majoring in things like cooking. She tries to tell these kids that, if you go to NW and take out a huge loan, you go there because you should expect that you will be able to pay back your loan based on the salaries you will make with your NW education. So if you really want to study cooking, or whatever that the market does not pay very well, transfer to an equially good school in cooking and pay 1/10 as much for tuituion!!

    It goes in one ear and out the other.

    nitro

     
  9. rdannes

    rdannes

    Why stop at education? Why shouldn't the costs of all good and services be based on one's "ability to pay", rather than arcane notions of supply/demand and perceived value to buyer and seller? Is education more important than housing, food, clothing, transportation? Progressive pricing models should be instituted for all these things, and many more.

    Soon, this would remove any incentive to become "rich" and thereby eliminate incentives to produce wealth, thereby eliminating the need for new industries and jobs.

    Oh, wait....
     
  10. In fairness, with the experience of comp sci grads and outsourcing, do you think that acquiring a skill like cooking that you could actually use to open a family-run resturant business is such a terrible idea?

    I'm sure that the kids are just clueless like Dustin Hoffman in the Graduate, but I can't say that working your tush off for a degree in a field that ceases to exist is smart either.

    Finally, there is an assymetric component to the student loan - YOU acquire the knowledge, but its not like your lender can reposess your brain.

    Just some thoughts.
     
    #10     Mar 9, 2008