People are outraged. 🤷♂️
University funding is being cut - 👻-hoo
For decades the US Government heavily subsidized some of the most expensive universities. Now this relationship is being "torpedoed" ....
AND
People are outraged. 🤷♂️
"I just don't understand how anybody could think this is a good idea!" - they exclaim.
Meanwhile, since 1980 Ivy League tuition grew at an average annual rate of 5.87%.
This outpaced CPI "inflation" at 3.03% annually over the same time period.
Inflation is in air quotes because the nature of the "basket" and its readjustment periods have changed several times over the last ~50 years.
The official CPI now tracks the cost of maintaining a standard of living, not just the cost of a fixed basket (as in 1980).
This means the CPI is less about
H𝘰𝘸 𝘮𝘶𝘤𝘩 𝘥𝘪𝘥 𝘱𝘳𝘪𝘤𝘦𝘴 𝘨𝘰 𝘶𝘱?
and more about ...
𝙃𝙤𝙬 𝙢𝙪𝙘𝙝 𝙢𝙤𝙧𝙚 𝙙𝙤𝙚𝙨 𝙞𝙩 𝙘𝙤𝙨𝙩 𝙩𝙤 𝙡𝙞𝙫𝙚 𝙩𝙝𝙚 𝙨𝙖𝙢𝙚 𝙬𝙖𝙮, 𝙜𝙞𝙫𝙚𝙣 𝙝𝙤𝙬 𝙥𝙚𝙤𝙥𝙡𝙚 𝙖𝙘𝙩𝙪𝙖𝙡𝙡𝙮 𝙖𝙙𝙖𝙥𝙩?”
And moreover the CPI calculation is somewhat of a fool's errand because the more apt inflation metric is the real CAGR of the M2 money supply which is ~6% since 1980.
Hmmmm. so interesting. Ivy League tuition increased 5.87% during the same time period ....
What does that mean?
It means the Ivy's (read: insiders) had no interest in having their revenue model diluted by money creation so they kept up with the real inflation rate.
ＲＥＡＬ ＷＡＧＥ ＧＲＯＷＴＨ ＦＯＲ ＴＨＥ ＭＥＤＩＡＮ ＷＯＲＫＥＲ
ＨＡＳ ＢＥＥＮ ＡＬＭＯＳＴ ＦＬＡＴ ＦＯＲ ４５ ＹＥＡＲＳ
... at about 0.35% per year.
Basically zero.
Your purchasing power has declined ~6% PER YEAR since 1980.
So why do you give a shit if expensive universities are losing subsidies?
Update on 17 June 2025:
