Government's Role in Soaring College Costs

"Americans have watched in anguish as the cost of college has soared out of reach," write Investor's Business Daily editors. "What they don't know is that a big reason for rising costs is the surge in federal spending over the past 35 years."

A new report from the Center for College Affordability & Productivity tells a story many Americans probably haven't heard — that college costs are rising fast not only because of a flood of new students, but also because federal spending is pushing up costs across the board.

The sprawling college aid program, say authors Richard Vedder, Christopher Denhart and Joseph Hartge, "contributes to skyrocketing costs, finances a wasteful academic arms race, weakens academic standards, lowers educational opportunity and worsens the underemployment/overinvestment problem."

The report notes that tuition after inflation was increasing at a modest 1% a year before 1978. Since then, fees have ratcheted up 3% to 4% annually.

A big reason for this is the 1972 Pell Grant Program, which was greatly expanded in 1978 by President Carter to include middle-class families for the first time.

The "long trek back to affordability" for America's college students, the authors' argue, will begin by reining in costs and curbing the size and scope of federal spending on education.