CHART OF THE WEEK

 

 

 

The chart shows how rapidly college tuition and fees have risen even after adjusting for inflation.

 

Government-subsidized credit to students can hurt the very population it was intended to help by enabling colleges to raise tuition prices and causing larger student loan burdens.

 

The link between subsidies and higher tuition was recognized as early as 1987 by William Bennett, then-Secretary of Education. A New York Fed study found that for every dollar of subsidized student loans received by a college, tuition increased by 60 cents and for every Pell grant dollar received, tuition increased by 40 cents.

 

From 2007 to 2016, tuition and fees at 4-year public colleges increased by 40% in inflation-adjusted terms. Over the same time, outstanding federal student loan debt exploded from about $500 billion to $1.3 trillion.

 

For more details on this subject, please refer to Chapter 5: “Addressing Higher Education” in JEC’s 2017 Joint Economic Report, p. 105.

 

LAST WEEK

News & Commentary Weekly Highlights

• The Hill: "Republicans are fighting for patient-centered care" by Chairman Tiberi
• E21: Only United Arab Emirates Beats America’s Corporate Tax Rate
• E21: Want to Help Women? Lower Marginal Tax Rates
• Wall Street Journal: U.S. Preparing Cases Linking North Korea to Theft at N.Y. Fed

 

Top Economic Indicator Highlights

• Chicago Fed National Activity Index (CFNAI) (February)

December 2016 was the first time since January 2015 that the 3-month moving average of CFNAI was greater than 0 (indicating above average growth). January and February continued the trend of growth above average:

Feb: 0.25        Jan: 0.07         Dec: 0.08

 

JEC Releases

• Consumer Directed Health Plans with HSAs are Growing in Popularity

 

THIS WEEK

 

Upcoming Economic Data and Events

• Monday
  • Dallas Fed Manufacturing Survey (10:30am)
• Tuesday
  • Advance Economic Indicators (8:30am)
  • Consumer Confidence Index (10:00am)
  • Richmond Fed Survey (10:00am)
  • Dallas Fed Texas Retail Outlook Survey (10:30am)
• Wednesday
  • Pending Home Sales (10:00am)
  • Dallas Fed Energy Survey (10:30am)
• Thursday
  • Gross Domestic Product (Final Estimate) (8:30am)
• Friday
  • Personal Income/PCE Deflator (8:30am)
  • Chicago Purchasing Managers Index (9:45am)
  • Michigan Consumer Sentiment (Final) (10:00am)