December 11, 2007

Harvard gives financial aid to the rich

Harvard decided to change it's financial aid policy yesterday. The big change is that Harvard is now going to be extremely generous to families making between $120,000 and $180,000. Essentially, annual tuition will drop to a relatively paltry $12,000 a year.The New York Times hails this as Harvard aiding the "middle class."But, let's be honest here. A family making between $120,000 and $180,000 is not middle class. In fact, it's not even remotely close to middle class. The median household income in the US was $48,201 in 2006. Data on income distribution from 2005 indicates that only 15.73% of households make more than $100,000, and only 5.84% make more than $150,000. I know that there is a sense that anyone who isn't hyper-rich or wasn't born into wealth is middle class, but that's a stupid basis to be forming policy around.Regardless, I can't help but be troubled by Harvard's decision here.There is a growing concern that top colleges are only accessible to the children of high earning families. Those kids enjoy many advantages like SAT prep courses, expensive college advisors, and private school education (or a well funded public school education). Harvard's move here seems to only enhance that idea. I loved it when Harvard decided that anyone who makes less than $60,000 goes to Harvard for free. This move seems to undo everything that could have achieved.To be honest, Harvard's move seems purely selfish. They probably lose fantastic students every year that choose to go to lower ranked schools that offer great financial aid packages or public schools that are cheaper (like Berkeley). Now that Harvard is out of the Early Admissions game they might want to re-establish their market power to woo those top students. This isn't a bad move to achieve that, but it's just silly to pretend like this is being done to help America's "middle class."