In a closed-door meeting Tuesday night, the University of California Regents announced a 5% increase in all executive salaries, with some executives seeing proposed increases as high as 33%. As mentioned in my previous blog, this occurred the same day that President Bush vetoed the College Opportunity & Affordability Act.

While the two are probably not connected, I find it very poignant that they did occur within hours of each other. Some may not realize that the failure to pass the College Opportunity & Affordability Act has left many middle class families in a difficult situation. On the one hand, they are not poor enough to receive financial aid and on the other hand, they cannot afford to send their children to a decent college even for an arm and a leg.

Providing financial aid to students does not justify an annual increase of undergraduate “fees” of 5-7% (double-digit increases for graduate and professional schools). In fact, without increasing financial aid (even to adjust for inflation), not only has the nominal cost of college increased but also the real cost. As a result, many people choose either not to go to college, to delay getting a college education, or to resort to borrowing tens of thousands of dollars. There are obvious problems to all three of these approaches.

Not going to college

With free trade agreements popping up left and right such as NAFTA signed by President Clinton or CAFTA signed by President Bush, manufacturing jobs are leaving our country faster than you can say “NAFTA.” Therefore, the future of our country’s economy depends on sectors that require a college education. For the 75% or so high school graduates who do not go to college, they will only contribute to the growing working class that is so often neglected in public policy.

Delaying a college education

How much can one earn with just a high school diploma or GED? That will not even pay for the basics in most places let alone health care and going to college once the government scraps financial aid. Yes, not everyone who delays pursuing a college education is trapped in the cycle of poverty, but like I mentioned in the previous situation, a college education is becoming more important and not something that ought to be delayed.

More Loans, and High Rates, and Debts…Oh My!

The average college student graduates with over $19,000 of loans to repay. At the current rate of 6.8% for Stafford Loans over the course of ten years, the average college student pays over $27,000 when all is said and done. That means that every month after deducting taxes and rent (assuming that rent is not increasing by over 13% like it is in reality), you can expect to pay somewhere around 20% of your remaining income on repaying college loans.

Something tells me that when UC executives are paid six-digit salaries (some approaching half a million dollars), providing students with financial aid is not what is driving up the costs of going to college.