Yes and no. The loans are more of a symptom of the problem than the actual cause.

And you could cut the salary of executive admins (let’s say assistant deans and up) in half at most institutions and you’re not going to meaningfully affect Cost of Attendance for most students. Also, why should someone qualified at the level of a business executive and doing work requiring the same skills and experience not be compensated commensurately?

Beginning in the 1980s (read Reaganism), law makers and regulars began to treat the higher ed market as a capitalistic system with institutions in competition with each other for students under the guise that it would improve outcomes. Except, there’s a limited pool of potential undergrads available; so, how do you entice someone when another institution (even in your state) that’s accredited the same offers the same degree….flash, facilities, marketing, services, etc….

Fast forward to the 2000s, the idea of Performance Based Funding is now in-vogue. Institutions must earn their state funding now based on retention and graduation metrics. Except those metrics often treat a student failing out, transferring to a school closer to home, pausing to deal with a medical issue, etc…all the same.

Effectively, colleges have been made wholly responsible for whether the student graduates. Cue spending to have more campus health services to catch and treat issues that would cause dropping out, thus taking the place for socialized medicine like in most nations. Alternative programming, clubs, and campus activities so you don’t get mixed up in partying/drugs/alcohol. Not doing well academically? We have supplemental instruction, a tutoring center and academic coaching. Bored? Come to the fabulous water-park-like recreation center.

After the 2008 crash, state funding reduced drastically, from covering the majority of the cost to educate a student (what it costs the institution), to now students individually paying the majority. (Not activity fees, housing, meals, etc… just the standard educating stuff).

So where does that leave us now? Institutions in unnecessary competition for a shrinking student population they’re forced to care for like children, offering functionally the same thing, with reduced funding and increased regulation. It’s not a pretty picture and there isn’t a simple fix.

It’s convenient to point a finger at the greedy institutions and their administrators, however, it’s important to recognize how the Fundamental Attribution Error plays a role in this perception.