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Opinion: Columnists

Hugh Hewitt: A reminder about what's good for the Harvard goose

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Harvard University president Drew Faust Gilpin was in a conversation before the assembled reunion gatherings of the classes of 1978 and 1988.

The day before, Oprah had exhorted the departing seniors of the College to expect and then overcome failure, and President Gilpin had...blasted the sequester.

Washington Post writer Melinda Henneberger noted how "the announcement that the Class of '88 alone had just raised $115 million sort of undercut [Faust's] perfectly valid message about the damage done by cuts to research funding, especially post-sequester."

That announcement also provided the backdrop for the Harvard president's remarks about tuition made to the alums. The topic was the runaway cost of college.

Only 40% of students paid "sticker," she explained, so not to worry so much about the $60,000 annual tab of a year in Cambridge. The real average cost of tuition per student was only $12,000 a year.

The bottom line, delivered with no little pride, is that Harvard is less expensive than most state schools for most students. This is a bizarre situation.

First, the idea that the world's most prestigious university has a "rack rate," which applies only to those the university decides are able to pay full freight suggests a lack of transparency that would be criticized in any other setting.

This purposeful confusion between asking price and real price is a standard practice in higher education, but the practice creates huge barriers to understanding the costs and direction of higher education.

Parents thinking about college a decade down the road have no real and reliable information on which to base their savings models as a result. Indeed, the elite institutions may be sending a message that it is better not to accumulate assets as college and universities will descend to swoop them up in short order.

The approach also effectively creates a new and much higher income tax bracket on those with a child or children in college. It is impossible to figure out what that new rate.

For families with two or more children in college, paying after-tax dollars to fund tabs of even two-thirds the cost of Harvard, the total cost is at least $300,000 over four years.

One mom told me she expected income taxes plus college tuition costs to absorb nearly all of the household's income that year, meaning of course that the family would have to live off capital - it's savings - or borrowed money.

This is a staggering hit on the "bottom high end" of wage earners, those folks targeted by Team Obama in 2012, the 1%. No sympathy for them in the public square, of course, but if Harvard assumes the families of the top 40% of their students sorted by income are well off enough to absorb the hit, then why should taxpayers worry about Harvard's research budget and the impact on it of the sequester?

If we assume that the highest income earners in the land should pay full freight with no subsidy, why should subsidies be extended to research universities sitting atop billions in endowment?

Harvard's endowment alone is near $35 billion. Should any student enrolled there be using a Pell grant? Should any federal research dollars be flowing there at all?

The Feds want the research done by the best and the brightest, of course, but there is no argument at all for a grant of funds to a highly capitalized institution that is not linked to a specific deliverable.

The reply, of course, is that Harvard does great things with the money it receives from both the government and high-income families. And it does. But it is a 1% institution, heavily favored by long-standing arrangements and vast networks of powerful alums.

Such an institution doesn't need subsidies, and its protests should be met with a pointer to that 40% of its student population is paying "sticker" -no subsidy - and a reminder that what is good for the goose ...

Washington Examiner Columnist Hugh Hewitt is a law professor at Chapman University Law School and a nationally syndicated radio talk show host who blogs daily at HughHewitt.com.

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