By Joel D. Joseph, Chairman,
Made in the USA Foundation
When I attended college in the late sixties and early 1970s student debt was extremely low, college coaches made modest salaries and there was little homelessness on college campuses. John Wooden, one of the most revered basketball coaches of all time, made $40,500 in 1975 when he won his 10th NCAA title for UCLA.
In the last forty years, the college world has been turned upside down. Coaches are paid astronomical salaries, even if they perform poorly. Tuition has gone out of control, and simultaneously student loans have skyrocketed. As a result of high tuition, tens of thousands of students have become homeless.
Steve Alford, UCLA's basketball coach, was fired recently for not doing very well in NCAA tournaments. Alford made $2.6 million per year, more than the governor of the state, more than the president of the United States and more than 99% of the population. Alford was paid fifteen times what John Wooden made (after adjusting for inflation), and 25 times what the top professors earn today. This craziness has got to stop.
Incredibly, Alford was paid less than 22 other college-basketball coaches. Mike Krzyzewski led basketball coaches with a nine-million-dollar salary from Duke University. University of Kentucky's John Calipari came in second at eight million dollars.
Football coaches are paid gobs of money also, led by Alabama's Nick Saban at $8.3 million. Saban's eight-year contract cost the State of Alabama $74 million, enough to fund 7,400 students with $10,000 scholarships. Alabama and Kentucky need to increase scholarships more than most states, as they are often near the bottom of states concerning higher-education funding.
Wisconsin HOPE Lab at the University of Wisconsin, Madison, recently released a study that surveyed students at 70 community colleges in 24 states. It found that 14 percent were homeless. Those conclusions buttress findings of a study released last year by California State University that estimated that eight percent to 12 percent of its students were homeless.
Tuition and Student Debt is Rising Out of Control
Since the 1970s, tuition rates have risen over 1,000 percent, while state funding of universities has declined by 40 percent. And the proportion of young Americans with education debt has more than quadrupled, from five percent to 22 percent.
Student-loan debt has spiraled upward. In 1970, a year at Harvard University cost less than half the median family income ($4,070 including room and board against a median $9,870 income). Tuition then cost $2,600 per year, approximately $16,650 in 2017 dollars. Today, that same education costs more than $63,000 per year including room and board, with tuition accounting for more than $43,000 of that total. And it isn't just the Ivy League schools that have seen astronomical increases in tuition. Between 1995 and 2015, in-state tuition at public universities rose by 300 percent.
Student-loan debt increased dramatically from $90 billion in 1999, to $480 billion in 2006 to $1.5 trillion in 2017. Remarkably, student-loan debt now exceeds the total of all credit-card debt in the United States.
What Can Be Done?