By Jonathan Peri • Posted September 27, 2022

Student loan debt forgiveness is a contentious national issue because of perceived fairness.  Our nation is divided on partisan lines. On one hand is the relief needed by recent college graduates in a post-pandemic economy, on the other is the issue of undue taxpayer burden. Both arguments have merit, albeit unequal.

Unfortunately, while one side is arguing debt forgiveness is needed because college costs are too high, the other side is arguing that college costs are too high, but it’s no reason to saddle the American people with debt they did not bargain for. The common element of both arguments is too often oversimplified. There is a hastiness to impugn the cost of a college education without looking at the value or return.

The costs to achieve higher learning are indeed high at some institutions, but the costs of higher education are not out of control in every state or at every institution. In fact, Pennsylvania has incredibly affordable post-secondary education and is nationally the fourth-most dense with post-secondary institutions, giving students far greater selection options, which in turn controls cost through competition.

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Saying the “price of higher education out of control” is convenient rhetoric that fails to scrutinize the facts. At the nonprofit independent colleges in Pennsylvania, i.e., at the 90+ institutional members of the Association of Independent Colleges and Universities of Pennsylvania (AICUP), the average net annual tuition is $13K per year. Net annual tuition is the average price students actually pay.  It’s a bargain considering the return on investment.

People who graduate with a bachelor’s degree in the U.S. have median lifetime earnings of around $2.3M, as compared to high school graduates with no college, who have a median around $1.3M (Carnevale, Rose & Cheah, 2009). This is in 2009 dollars. In today’s numbers, the bachelor’s degree value is probably closer to $2.8M-$3M, particularly in a “great resignation” market where employees have an advantage.

Calculate that against the cost. If we are conservative and say that a bachelor’s degree gives median lifetime earnings of $2.5M, and if we say average net tuition for four years is $52K, then the cost is 2.08% of the return.  In other words, the return is 48 times the cost. Name another time you earned 48 times an initial investment.

Even if the cost were twice as much, the return would be 24 times the investment. In terms of borrowed money, it’s usually not the total cost. When AICUP students graduate, they average less than $36K in total debt, which incidentally is less than the average for Pennsylvania’s public institutions, who are averaging just under $38K.

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The framing of higher education’s price as being “out of control” strikes a particular chord with me because the college where I serve as president is literally a model institution. Manor College is a small private Catholic institution that serves 60% diverse students, 65% first generation students, students who work while in college by a margin of 75-85%, and 76% students from the inner city of Philadelphia. On average, our students graduate with less than half the debt of other colleges: Manor’s median debt for graduates is $16,432. We do it all by offering an excellent education at the most affordable private residential college tuition in the state, by a margin of $14, to be exact. This is what higher education should be: mission-centric, practical, academically excellent, and within the reach of all families.

When students, parents and guardians are searching for higher education, they need to be prudent about their selection. Picking the right institution in the right state makes all the difference. Choosy consumers find the best value at the best price. Generalizing higher education’s costs is like generalizing anything, it misses the mark on the details. Higher education in Pennsylvania is affordable with an incredibly strong return on investment.  Whether you are for, or against, student loan forgiveness, is up to you in November. But either way, look at higher education for what it is, the predominant investment that catalyzes upward economic mobility for families and individuals in our country.

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Jonathan Peri, Ph.D., J.D., is the president of Jenkintown-based Manor College, a private Catholic college with deep roots in the Ukrainian American community.