Despite claims that declining state appropriations are the problem, actual state appropriations have increased each year. When adjusted for inflation, state appropriations for higher education have been relatively flat. Figure 2 illustrates state appropriations for higher education going back to 1990-91. Calculated in constant dollars (2006), the state’s appropriation per student came in at $7.626 in 1990-91 and remains relatively stable at $7,663 for 2008-09.

In fact, according to Figure 3, state appropriations have remained relatively flat since as far back as 1980-81. Tuition has increased steadily, as have higher education gifts and endowments. Overall, the per student cost at the state’s public colleges and universities has climbed from just above $20,000 in 1980-81 to more than $35,000 in 2006-07 in constant dollars. This means that today’s education is roughly $15,000 more today than it was in 1980, even when adjusted for inflation.

This trend suggests that the increases in tuition are a symptom of a larger problem—higher education costs have increased substantially overall. In fact, it seems that as the state’s appropriation has remained stable, it is the increasing costs at colleges and universities that have necessitated the increases in tuition.

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Should we focus on tuition?

But why have higher education costs increased?