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by brohoolio 3305 days ago
Sports often generate enough revenue to cover the costs for the top tier schools. Top ranked universities use sports to build donations from alumni, brand awareness, etc.

If you want to tackle a good portion of the high cost of higher education tackle medical costs. It influences the cost of everything in the US. If you earn $50,000 a year the university is paying another $10,000 - 20,000 for insurance.

4 comments

"Nearly every university loses money on sports. Even after private donations and ticket sales, they fill the gap by tapping students paying tuition or state taxpayers."

https://www.usatoday.com/story/news/nation/2013/09/15/athlet...

How do you do that without massive numbers of voters losing their jobs? The US spends 17% of its GDP on healthcare. Europe spends an average of 10%[1]. Do you know what it is called when a country loses 7% of its GDP? Recession.

How do you incentivize a group of politicians to intentionally do that?

[1] http://data.worldbank.org/indicator/SH.XPD.TOTL.ZS

Actually, I think this is at least part of the reason for increased healthcare costs. The consumer almost never the one paying for healthcare. It might help to lower healthcare costs if there was no longer a tax incentive for employers to use healthcare as a form of payment. If that happens it will make far more sense for employers to let their employees deal with the administrative overhead of finding health coverage and pay them higher wages to make up the difference. Suddenly the employee is much more aware of what their health coverage is costing and now has a much greater interest in it costing less. Without the consumer being the one paying for things costs can on paper get a bit crazy when in reality it costs the company a reasonable amount overall as they've negotiated with the insurer and the insurer has negotiated with the hospital.
This is of course self-reinforcing. The reason they want lots of donations from alumni is because it increases profits. But they can only get those donations if the alumni have very fond memories of college. Thus they need to spend donated money on making students feel like they're part of something special, something they'd want to contribute back to. And that increases costs further.

(I went to a humble college, got a degree that doesn't do much more than tick boxes on job or visa applications, and enhanced it with self-study to get an effective education. I feel no obligation to send donations back to my college.)

I have no inclination to donate back to the university I attended since I paid more than enough in tuition. Also, as an out of state student at the time, the tuition and fees I paid was used, in part, to subsidize in state student costs.