This paper will focus on the economic impacts of the policy decision by California Governor Brown to decrease funding of the California State University and University of California systems by way of looking at the impact on the economy of less college graduates. I will do this by looking at two variables. I will first look at the multiplier effect of the state putting money into the California State University system and what will happen as a result of the divestment due to the budget cuts. I will then look at the decrease in the median income due to the fact that the budget cuts will cause a decrease in enrollment which means there will be fewer college graduates and college graduates earn more money than their non-graduate counterparts …show more content…
(California State Governor’s Office) According to a report presented to the Office of the Chancellor by IFC International for every one dollar spent by the state on the California State University system “the CSU generates $5.43 for California’s economy annually. When enhanced earnings by graduates are taken into account, the annual return rises to more than $23 for each $1 invested.” (ICF International) This, however, does not necessarily mean than the $542.4 million in cuts is multiplied by $23, resulting in a total decrease of $12.475 billion in spending. This is because the relationship isn’t necessarily completely linear. Since the decrease is only 8.5% then the relationship might still be linear, which would mean that there will be $12.475 billion in spending lost. The other reality might be that it is not linear, which would mean the total loss of spending would be less than $12.475 billion.
Another area I will look at for the California State University system’s budget cuts is the resulting enrollment cuts. With less money coming in from the state the universities have to save money by enrolling fewer students. However, the money cut from the CSU budget doesn’t have a direct relationship to a decrease in enrollment. The change in enrollment is determined by the universities and is filled every semester. Enrollment is scheduled to decrease in
Neill provides data on the increase of amount of students working full-time and part-time jobs during their education. She shows how this has been increasing since the 1970’s and more students are having to work while attending college to pay for expenses. This source also helps demonstrate how a shrinking middle class is affecting college students because low-income students need to work during college. It also provides more evidence on how increasing tuition is affecting students in general.
Some may feel that this is soley the students fault, while in actuality, budget cuts take a major toll as well. Marcus obtained information from Califorrnia State University that two-thirds of their students couldn't register for the clasess they needed, because of funding,
These budget cuts often effect the teachers by their salary. Also, if the teacher in the Teacher Forgiveness Program got laid off because of budget cuts before their five years where up then none of their loan would be paid.
The state of California has long been reliant on the University of California system to provide its resident companies with skilled and educated business, technology, and science leaders. Highly regarded as one of the top educational systems in the world, the University of California boasts a high number of distinguished and respected faculty members in almost every field of study. However, while most private colleges and universities have learned how to streamline their processes in order to better respond to stakeholder needs, public educational institutions, such as the University of California, have not been willing to control their bureaucratic growth resulting in a rise of tuition rates and a decline in the level of student satisfaction. In her article for the TIME magazine, Kate Pickert writes that as recently as November of this year the University of California has approved a plan that could raise tuition rates by up to 28% (Pickert). Pickert also points out that the tuition rates at the University of California have more than tripled since 2001. The University of California has blamed the increased tuition on the state of California budget cuts caused by the economic downturn of recent years. However, a closer examination of the University of California faculty and administration data makes it obvious that the higher rates of tuition are cause by the inability and
The National Conference of State Legislatures said, “School budget crunches have been a trend over the past couple years and span the entire nation” (qtd. in Van
The state's funding equation is tied directly to enrollment, meaning a decrease in enrollment results in decreased funding.
Liberals say that with prop 30 in affect that finally students will get the reward of more classes and less education cuts in California. This will allow more students to enroll in higher education classes and hopefully be able to decrease the cost of education, if not lower keep at a tuition freeze for a few years. With more students enrolled in classes it will generate more of educated society. According to Sash Abramsky “The university of California projects a 20% midyear tuition hike and $250 million cut that will immediately trigger if proposition 30 does not pass and there will be automatic cuts to education totaling $5.4 billion dollars to the state of California” (Abramsky). With that being said that could have affected millions of college students in school today. They would have had to cut classes as well as teachers who teach the classes. This also would have probably driven the cost of tuition even more than it already is. Sasha Abramsky says “proposals to eliminate taxes and said no, or they looked at proposals to increase taxes and said yes. Several anti-tax initiatives did pass—including a supermajority requirement in Washington. But no state ballot measure was as high-profile, or as significant to the national debate, as
This budget contains grants, reimbursements from schools, and payments that is from schools. $72.9 billion was set aside for public and higher education institutions. Most of the money is difficult to get if it is for a project that it was not intended for. Since the legislature cannot take money out of these two accounts when they would like, they just cut the budget. This is to give them more wiggle room in other areas that they would like to see the budget go to. There is a cycle that can be seen throughout the government. If the state wants money they need to spend what they have in order to receive federal
One of the important drawbacks of the budget was the cuts and delays in education funding. As published in the article “California lawmakers pass long-overdue budget” (2010), by Fox News “Under the deal, nearly $2 billion in payments to K-12 schools and California's community colleges would be delayed until the next fiscal year”. This was one of the consequences of the late deficit budget, which lawmakers agreed upon. Stopping payments to educational institutions was not seen as a positive feature of the budget. The delay in funding kept the educational programs on hold, which affected many educational
Report by the Legislative Analyst's Office that predicted a severe budget shortfall meant that most of the California public school students were to experience shorter school year. Governor's tax measures tried to solve the cuts of public school financing. Menifee district depended on Governor Jerry Brown's initiative or the education to face $5.5 billion, thus advising school districts plan for the worst case scenario in their endeavors to come up with their 2012/2013 budget.
The cost of attending college has risen drastically over the years. Statistics show that there has been a 260% increase in tuition costs since 1980. The increase in tuition cost equates to an increase in money borrowed to fund higher education. An increase in money borrowed results in an increase in debt accumulated over time. As a result of the rising figures, the economy as a whole has also suffered because of the restricted financial space many graduates find themselves in upon completion of their degree. In this paper, we will discuss college costs, reasons why they have risen, and the best way for students to pay for it.
Revenue would not fall or remain the same it would increase more likely due to the economic industry. Tuition have risen in the past and it has not stated the same
The cost of tuition for higher education is quickly rising. Over half of college freshmen show some concern with how to pay for college. This is the highest this number has been since 1971 (Marill and O’Leary 64-66, 93). The amount of college graduate debt has been rapidly increasing also. With limited jobs available because of the high unemployment rate, college graduates find themselves staying in debt even longer. Although grants and financial aid are available to students, students still struggle to pay for their college tuition. Higher education costs are prohibitively expensive because the state’s revenue is low, the unemployment rate is high, and graduates cannot pay off their student loans.
I appreciate you listening to my concerns about the one hundred sixty-nine million dollars cut that governor Jerry Brown has taken away from the CSU expenditures. Since the funds are taken away from for the CSU campuses I would truly appreciate that you would consider not increasing the tuition by a lot and keeping in mind that college should be affordable for everyone. Without a doubt being in college is extremely stressful and know students not merely have to fear about making additional money to pay for their education, but have concerns about affording food,
According to an article from Capital Ideas, the results of budget cuts can be severe on schools with a high poverty rate. In order for these schools to stay within their budget, they must take drastic actions. Some of these actions include limiting bus travel for students, cancelling summer classes, overcrowding classrooms, and so much more. (Ginn 2012) Each of these “actions” has different consequences for each student. For example, overcrowding of classrooms can cause little to no