How much money do colleges really make?
By: Justin Leeds
Colleges have way too much power. To start off a college can control education and money flow for a local economy. If a college has a large name sports team like the Alabama or Duke that alone brings in millions of outside money to the local economy. Some colleges even build up large surpluses
A college is classified as an educational institution or establishment, in particular. Some of these colleges can be anywhere from 62 thousand a year to free depending on level of school and other outside factors. But did you know that some of these colleges might as well become banks with all of their extra income. According to The Ten Richest College Harvard has more than $30 billion, but this isn’t just Ivy League school building up large stacks of money, Michigan has saved up nearly 8 billion to lead the big ten as the richest school. Not all of these schools have built up these bank like funds from high tuition. University of Michigan- Ann Arbor only cost 25 thousand in state. All of this saved money is slowing down the economy from operating at its maximum potential.
This is not to say that Universities should spend all of there money and live tuition to tuition but there is no reason for holding an excess of over 5 billion dollars. Universities should be required to spend no less than 90% of their income to help create a much stronger economy. Not only will this directly increase the economy but with the multiplier effect the GDP for that local area will increase much larger than initial payment.
Not only do University make large amounts of money from tuition and alumni support but the athletic programs are not doing too bad either. According to USA today some colleges like, for say, Texas make 163 million dollars. Ohio State just edges out Michigan with 142 million a year just from their athletics programs. This is mostly outside money being brought to the town of the local sports team.
These two reasons are why college towns do more than just exist but thrive. For example when Michigan (trying to keep a constant example, sorry if it seems like I am in love with this college) host a football game there will be over 110 thousand people in the stadium. Now all of these people start spending money in the college town’s economy instead of their local all of this money trickles down and leads to better money flow. Also as soon as graduation happens there are thousands of highly trained workers ready to join the work force in a quick way to be off of unemployment.
Now for all of this information is top end teams and colleges but the ability for a college to control a local economy is greater than the government in some extreme cases. Which leads back to the really question, do colleges hold too much power?
I never would have thought that schools could make so much money. One would think that they would use it to better themselves by finding a better way to educate the students, or to build upon the actual school structure. But as human beings they only will in most likelihood to deepen their already deep pockets.
ReplyDeleteAfter seeing how much colleges actually make from their students tuition, I can’t help but think that they should be able to lower the prices to attend their colleges to make it more affordable for people to actually go there and get their college degrees. In the long run, lowering college prices so more people could obtain degrees means a more educated society and better paying jobs to boost up the economy. That’s just my opinion though.
ReplyDeleteDivision 1 colleges are one of the most expensive because how much they pay for their athletes. The top schools don’t always make money like it seems. But you have to account for the money they spend on their students full ride scholarships. There is also transportation costs, hotel costs, and many more costs to have their athletes have the best equipment and the best environment to help them win.
ReplyDeleteAs I get ready to head off to college in the fall and make one of the biggest financial investments of my life, I started to wonder about what all of the tuition money actually goes to. I find it extremely hard to believe that colleges need all of the money they get from student's tuition to pay for university needs and education. After learning that they are saving up billions of dollars I see absolutely no reason for them to be unable to lower costs. Like you said, by them doing so, the economy is unable to function at its full potential.
ReplyDeleteI wouldnt expect some of the colleges to be so expensive, and they would make so much money on little things like the athletic program. I understand that they are making it to where there is more money being put into it however I dont believe theyre using it as well as they could be anyways with all of that money being put for college. Its a little unethical and quite ridiculous.
ReplyDeleteColleges seem to be able to set their own prices because of the need for education in this country. If a person wanted to go without college they would have a harder time making a living but at the same time will not have as large a debt. Colleges are making enough money off of the students that they are able to do a lot for the students.
ReplyDeleteThe price of education has grown drastically, unnecessarily. The actual price to put a student through college is far less than what they charge. While state schools are regulated by the state and not allowed to build up big surpluses, private colleges are. That is why their tuitions are so high. The economic benefits do not seem to match the economic costs of education. This was a very good topic to write about as it is pertinent to many of us as we begin to look at colleges and attempt to pay for it.
ReplyDeleteThis is a great topic! Many of us will be going off to college in a few months and I know most of us have wondered where the tuition money from all the students come from. Schools whose tuition's are well over $20,000 a year definitely makes more than they need too. And It seems very unnecessary for the university to just basically pocket the money for themselves and let it build up like that. And if they are saving that much money, then there is no reason that they can't lower the prices. Lowering their prices could possibly bring more students in.
ReplyDeleteBefore i comment on what was said in this blog post, I'd like to voice my view on the subject, i believe all in all colleges probably make a little too much money, the amount of money that go into college tuition and funds and etc each year is simply mind blowing, but the thing that makes this OK is that now a day college is a must and isn't something that can just be ignored. Universities can make from hundreds of thousands to billions, but it doesn't mean much if the money is being pocketed instead of distributed back into the economy somehow. Especially the major schools that make millions a year off students which can vastly effect the economy in a beneficial aspect because America making money and the money getting put back into America is simply a plus in the long run.
ReplyDeleteHow do you propose they put the money into the local economy? I think the best thing to do with the extra money is to lower tuition for all students, athletes or not. This would increase the amount of students attending, and thus bolstering the local economy through the increased action of more students.
ReplyDelete