Scott Fitzgerald on Ivy League Collusion, Rising Tuition, and Shrinking Class Sizes

Higher Education as a Collusive Industry

• 🎯 The higher education sector in the US is a $700 billion industry, with institutions like Harvard holding endowments larger than the GDP of many nations.
• 💡 Instead of competing on price and quality, Ivy League schools are accused of colluding to raise prices and spending revenue on administrative bloat.

Escalating Costs and Reduced Access

• 📈 While other industries have seen costs decrease due to competition, college tuition and textbooks have risen by over 180%, with annual costs at Ivy League schools now exceeding $100,000.
• 📉 Tuition at Harvard has increased from $600 in 1950 to nearly $60,000 today, demonstrating a dramatic skyrocketing of costs.
• 🎓 To maintain exclusivity and perceived prestige, Ivy League schools have deliberately kept class sizes small, even as applicant numbers have surged.

Historical Collusion and Legal Challenges

• 🤝 The "Ivy overlap group," formed in 1958, acted as a cartel to fix prices by agreeing on shared financial aid formulas, leading to a 1993 antitrust lawsuit settlement.
• ⚖️ Despite an antitrust exemption granted in 1994, elite schools formed the "568 President's Working Group" in 1999 with the same objective: to avoid price competition.
• 💰 A 2022 lawsuit revealed internal documents where administrators expressed concern about not finding enough wealthy students to pay high tuition, highlighting a focus on maximizing revenue from affluent families.

The CSS Profile and Pricing Strategies

• 🔍 The CSS profile is used by colleges to gather sensitive financial data, enabling them to determine and charge families the maximum amount they can afford.
• 💸 Even with multi-billion dollar endowments and taxpayer funding, these institutions prioritize profit and prestige over accessibility and educational quality.

Broader Economic Impact

• 📈 The Ivy League's tuition setting acts as an industry standard, creating an umbrella effect that allows other colleges to charge more in a non-competitive market.
• ⚠️ The discussion aims to address how these anti-competitive practices may harm students, taxpayers, and the nation's future.