3 min read
Are the rich paying their fair share? This is the question that has dominated our tax debate for the past few years, but it is really a question that could be applied to private institutions as well. In an op ed last week in the New York Times, R. Scott Asen, a graduate and former trustee of Groton School, writes that the rich should be paying more for private schools. Yes, you read that right. A price tag of $40,000 or even $50,000 may simply not be high enough. Ason explains that for many schools, the tuition they charge does not cover the cost of educating the students and so schools hold endless fundraisers in order to squeeze more money out of families. PTA mothers pressure others to bid at expensive school auctions or purchase pricey raffle tickets.

The solution Asen offers is that every family should be expected to make up some of the "gap" between the cost to educate their child and the actual tuition. Everyone will go through a process similar to the one for financial aid applicants, in which the school determined the family's wherewithal to pay more. Any family that declines such a review of their finances will have to pay the full amount of the "gap."

How is it that $50,000 is not enough to cover the cost of educating a student? He assures us:

For 10 years, I headed the development committee of the board of trustees at Groton School, a secondary boarding school in Massachusetts, and ran two major capital campaigns there. I can attest that expenses have so far outstripped revenues that no amount of cost-cutting at such schools, healthy as that may be, can come close to solving the problem. We need to also look in the revenue side for solutions.

No amount of cost-cutting? Of course that's not literally true. Public schools (especially charter schools), parochial schools and some secular private schools obviously manage to educate students for much less. But Groton is Groton. And if you want to attract a wealthy clientele, you need to offer a lot of frills that other schools do not. You have to know your market.

But then why not dispense with this entire system and just charge $100,000 a year for tuition and give out more in the way of financial aid? That's obviously the model colleges are moved toward. (When tuition, room and board is $60,000 a year at a university, just about everyone will apply for financial aid.) Just put some outrageous sticker price on and then charge every family individually what you think they can afford. Maybe the administrations just think a $100K price tag would be bad pr. Prep schools could probably get away with this even more easily, though, since no one thinks that a Groton education should be open to all the same way they believe a Harvard education should be open to all.

But what about the principle behind this? Should we all pay according to our means? In what arenas should the system work this way? Should our grocery bills be calculated based on what we can afford?

If more people understood the way the system worked in education, I wonder if they would make different choices. Why bother saving for your kids' college when you will just be penalized? The colleges will assume you don't need any help even though you have been scrimping and saving for years. Maybe these questions will make couples rethink whether both husband and wife should work or what kinds of professional choices they make. Sure you could be a corporate lawyer, but if you are a single-income family headed by a think-tank scholar, you'll have a better chance of getting your kids' education paid for. Heck, why not go into more debt buying expensive cars or homes. It will only "help" your bottom line in the end.

There are those who might find Scott Asen's plan to be more fair. They will say that the super-wealthy won't even notice another $20,000 or so. And they may be right. All of those rich people who say they want to pay more in taxes . . . it's true, they might not notice. But the system matters too. At Groton or Harvard, there is always going to be some financial aid czar at the top making arbitrary determinations about who deserves to pay less and who deserves to pay more. It is a process that often causes anger and envy. It does not reward industry and thrift. And for many, it doesn't seem fair.

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