College Discount

Elite Ivy League students can expect a break on tuition. What about everybody else?

YALE UNIVERSITY is following Harvard's good example in tapping into its large endowment to make college more affordable. Students and their families will benefit. But they'll be a lucky few: The initiative, while certainly commendable, will do little to help students nationally and may even have the unintended consequence of hurting those most in need.

Yale's program will cut the average cost of going to college in New Haven by more than 50 percent for families with financial need, beginning next fall. The sharp increase in financial aid takes an expansive view of families who should be helped. Those earning less than $60,000 annually won't have to make any contribution while households with annual incomes as high as $200,000 will see significant savings. For instance, a family with two children in college receiving financial aid with $180,000 in income and $200,000 in assets will be billed $11,650 total instead of $22,300. Harvard unveiled a similar expansion of its financial aid last month.

Yale President Richard C. Levin candidly admitted that one spur for the new program was pressure from Congress. Sen. Charles E. Grassley (R-Iowa) is considering a proposal that would require the well-heeled institutions of higher education to spend a minimum percentage of their endowments each year. No doubt places such as Yale, with an endowment of $22.5 billion, and Harvard, with an endowment of $35 billion, have the ability to do more to help families with the cost of education. Harvard's endowment grew by $6 billion last year alone, and its new policy will cost $22 million. That, as the New America Foundation pointed out in its higher-education blog, is about one-third of 1 percent of the growth in the endowment. The group noted that Congress just spent $6 billion to cut in half interest rates for undergraduate loans over the next five years -- nationwide.

Other elite private universities are rushing to follow the direction set by Harvard and Yale, and that can only be good news for college goers. Still, that will do little to help the more than 75 percent of higher education students who go to public colleges and universities, most of which don't have huge endowments. It's worrisome that some see an adverse trickle-down effect from the Ivy League's new generosity: In order to compete for top students from middle- to upper-class families, some colleges may shift scholarship money away from those most in need. Already, in response to Harvard, some flagship schools have said they'll have to increase fundraising for merit scholarships.

Adding to the pressure is an expected economic downturn that could well see diminished state support for higher education. Mr. Levin is right to argue that instead of criticizing his institution and Harvard for taking steps in the right direction, states should be reexamining their own practices.