Governments around the world have sharply reduced funding for public education, and colleges and universities increased tuition fees as a result (Simpson 14). These measures became a response to the current economic crisis and the decrease of governmental donations. Moreover, education became the matter of private concern and seized to be the issue of national importance (Hrenberg 29). At the same time, the position of educational institutions has reeled with the development of on-line education. The function of collages can narrow to providing the service of accreditation in the nearest future if the educational and motivational environment will not be improved. On the one hand, universities claim high fees. On the other hand, the quality of education does not grow, and talented students can achieve competitive results without attending a college or university. While a great number of students tries to buy their diploma, the Internet provides capable students with an opportunity to achieve prominent results through self-studying almost free of charge.

The research paper examines the fundamental change in the system of higher education financing in the USA. It claims that the increased access to the self-education through the Internet has led to the reduction of need in traditional academic fulltime learning. Universities and colleges should maintain and establish creative learning environment and implement a reasonable tuition fees policy. Otherwise, the cheaper distance education will engulf the fulltime learning. The solution to the problem of tuition fees reduction is in promotion of the distance education on the state level.

Maintenance of Higher Educational Institutions in the USA

The reasons for tuition fees increase in the last decades in the USA were the same as worldwide: the reduction of governmental donations and reduced funding from the private sector (Samuels 49). Diversification of sources of financing of higher education has become a strategic approach for governments experiencing the pressure from various public spending. In response to a slowdown in government subsidies, the enterprising leadership of colleges and universities has developed a number of new financial opportunities. The practice has demonstrated the reality of governmental revenue but raised many ethical questions.

The dominant strategy to diversify revenue in higher education institutions became a significant increase in tuition fees and various forms of contributions. Students of public and private institutions of all kinds may have noted that over the past ten years, tuition has increased by more than 20%. Two-year public institutions credited 38% of the students and have the smallest increase of 23% in tuition fees (Reynolds 22). Four-year public and private colleges have had an increase by 36-38% (Reynolds 22). “America is facing higher education bubble” (Reynolds 12). Moreover, in recent years, the US students protested against the increase of tuition fees in the state university system of California (Hrenberg 32). The costs for studies gradually increased and doubled in a decade, but the sudden additional increase of 32% in November 2009 triggered the student protests. Since 1970, it was the largest and most widespread discontent in American campuses and the students seized the building of universities and organized demonstrations (Hrenberg 32).

Claiming their demands, the California students focused on social inequality caused by high tuition fees and a decrease in funding of university as a whole. It was obvious that the group most severely affected by these changes were the poor, but capable students. The demonstration shows that the modest success of a project creating a more accessible university education for the masses of the population that took place in the twentieth century, gradually lost its relevance. Christopher Newfield, the professor of the University of California, Santa Barbara, explained that over the last 30 years, public universities that teach the majority of American students were systematically underfunded. It made all the improvements in the education an exclusive privilege of the students with the highest incomes. Such approach broke the previous global advantage of the right for free public education (Newfield 37).

Strategies for Universities Funding Improvement

Since the growth or rate of government subsidies slowed, US colleges and universities, as well as their foreign counterparts, actively and vigorously took up various private sources of funding. Universities have historically always needed patrons. In the middle ages, the church donated to education. Later, the government took responsibility for the intellectual development on the state level. Nowadays, there has been a shift in the direction of the business, industry and other private sources. Private funding sources have become an important part of the revenue to maintain the research. Despite the fact that private financial support for science is only 7% of total expenditure in American universities, this factor has become the most rapidly growing source of cash flow. For the last 30 years, the ratio has doubled (Reynolds 25).

Many universities around the world initiate or develop efforts to create an alumni association, but tangible results have to wait a long time. Nowadays, most of the institutions are very active in attracting remittances and research grants from international foundations and agencies. In addition, to the tuition fees and the search for international support, there is a wide range of strategies to diversify revenue streams, depending on the legal, economic and cultural contexts. In the USA, colleges and universities organize a growing variety of alliances with businesses and industry. These alliances take a form of donations, partnerships, research grants and contracts, training programs, and joint degree programs, to list a few. Nonetheless, even in relatively weak economies in transition, some universities are developing productive cooperation with emerging or resurgent private enterprises.

It should be noted that the situation in the USA universities is comparatively better than in other parts of the world. While, in the UK, Italy, and other European countries, students are fighting with police and experimenting with new ways of protest against the government, the American campuses maintain relatively calm. The student movement in California was significant but not as intense and long-lasting as in Europe. The obvious reason for such a difference was the gradual nature of the changes in the American university. In the United States, tuition at public universities has long been higher than in most of the European countries, and the recent rise has been relatively modest. Raising fees by 32% in California in 2009 was not comparable to the planned increase in the UK by almost 300% (Newfield 42).

However, despite a relative stability in the USA universities and colleges, the funding system of American education has developed unresolved contradictions between the raised inflation, prices and the family incomes. The importance attached to the public higher education sharply decreased. Many applicants disappointed in the system and started looking for an alternative of the academic studies. The problem of tuition fees reduction needs an intervention on the state level. The university education should be a priority for society and not an individual goal, and the distance education is an alternative for the mass public education improvement (Newfield 44).

The Correlation between Private and State Funding

There is a philosophical question about the role of government and the state’s economic efficiency, namely, whether higher education is a public good or private interest. The World Bank and other influential organizations and individuals have long argued that government subsidies in higher education in many countries are too large, and therefore, are not cost-effective. Private investors may want to place the social capital private investment in higher education because the benefits and profits from such activity can be significant. The argument in favor of higher education as a private interest was championed by Milton Friedman, the Chicago School, the London School of Economics, the World Bank and others (Hrenberg 38). Nowadays, this argument, with some exceptions for the Nordic countries, has become almost a postulate in political circles throughout the world. The debate is about the extent to which the tuition fee can be enlarged.

Economists believe that the market should regulate the price limits (Hrenberg 44). One of the key political issues around the world, accompanied by a rapid rise in prices for education is an issue of student financial aid. This question is particularly troubling in the situation of unstable income, which is the basis for determining the needs of the student financial assistance. The system of student loans needs improvement taking into account their financial position. This factor raises a serious question of the strategy of the private capital attraction as a guarantee of access to education for those who do not have sufficient funds.

In the book Tuition Rising: Why Colleges Costs So Much, Ronald Hrenberg states that the increase of tuition fees has always been attractive for the majority of rectors and presidents of colleges and universities because this approach has broadened the opportunities for the multiplying university budget. Diversification of revenue gives more shared resources, flexibility and financial stability, in contrast to the previous situation, when all the funding came from the Ministry with a strict control of expenditure. Many economists and politicians claim that reducing of the proportion of government subsidies for higher education is a condition for a good economy. The need for highly qualified personnel leads to a well-paid graduates, and therefore, further reinforces the thesis that higher education is a private interest (Hrenberg 45).

However, the global dominance of the market as general economic and political philosophy has led to the strengthening of the position for growth in prices for education. Higher education institutions are constantly seeking to maximize revenues, reluctantly, but deliberately move to increase of tuition fees. However, while authorities vigorously seek and find sources of funding, the problem of the lack of quality education remains open and unsolved. Students turned into passive consumers of knowledge and feel confident in the positive outcome and getting a diploma evening cases of poor studies and academic performance. Joanna Williams notes that, “consumers’ status ultimately erodes students’ autonomy and reduces learning to an instrumental focus on credit accumulation” (32). The scholar emphasizes the mechanization and artificiality of the learning process in modern universities and draws attention to the importance of critical thinking development and autonomy efficiency in studies. This opinion shows one more advantage of the distance education in comparison with traditional full-time university learning.

Competition between Distant and Fulltime Higher Education

In the United States, distance education started active development at the turn of 1980-1990 (Moller &Huett 19). The original purpose of its appearance was to increase the skill level of certain categories of the population, who wanted to pursue higher education remotely. As a rule, the major portion of that category were workers who, after graduating from high school, were forced to go to the production facilities for the purpose of earning funds. Such way of studies was also acceptable for immediately and temporarily disabled citizens.

Taking into consideration that such approach saves much time, money and efforts and due to the development of telecommunication means, this form of self-education gains popularity and attracts students originally oriented on the full-time academic learning. It should be noted that today, the importance of mass education to the nation’s development is no less than 50 years ago, but the economic importance of the different fields has changed. Together with a wide range of scientists, Toni Negri believes that in recent decades, a dominant position in the economy shifted to the so-called “bio-political production” (as qtd. in Samuels 46).

The concept implies a humanitarian approach to the development of a person, including the creation of ideas, images and other intangible benefits. In regard to this change, the mass education of engineers and scientists is no longer the main key to the economic competitiveness of a state. In bio-political economy mass intelligence, especially linguistic, advanced communicative and social skills drive and move the economic innovation. University policy around the world has not kept pace with these changes. Private investment, which compensate requires of the universities for the decline in public funding, allocated mainly technical and natural science areas. The humanities, which are more relevant in the bio political economy, lack funding and stay weak (Hrenberg 46).

In recent years, widespread use of the Internet provides students with access to an immense number of sources that are in many cases free of charge (Moller &Huett 29). Distance learning opportunities are widely used by different departments in the process of training and retraining. The system of corporate remote training received extensive development. The use of these systems in corporations and companies shortens the high cost of retraining and separation from work in the process of eternal staff training. Characteristically, the distance learning programs of companies and corporations have a focus on training in the field of business and such approach can provide a student with the necessary knowledge for successful performance of one’s duties in a company. The current status and development of distance learning is in retraining and accomplishment of bachelor’s and master’s degree programs. “Control of the learning process is shifting away and into the hands of learners” (Moller and Huett 33).

In the light of these changes, the whole system of education loses its traditional function of information transition and acquires the role of efficient manager and controller of the research and development process. The current task of a university is not to teach, but motivate and organize the most productive learning and creative environment. Nowadays, many universities have already deciphered a threat of the high tuition fees for their maintenance with regard to alternatives of distance education. Moreover, a great number of higher educational institutions have already reduced the tuition fees and lure capable students with attractive loans and grants. The promotion of distance education on the state level is the best solution of the tuition fees raise problem.


Despite the current economic crises in the world, educational institutions should be very careful with the raise of tuition fees. The universities have to pay more attention to ensuring that performance of their service meets the requirements of the high standards of quality and modern progress. The requirements of the society and modern trade market are gradually tightened. The fulltime traditional form of learning is substituted by the distance education. Modern universities should work at the credibility and prestige and attract not rich but capable young people in order to provide and maintain sound competition. Both students and teachers should work on the improvement of the rating of educational establishment. Tutors should avoid treating students as a source of their income, and the fees for tuition should decrease. Otherwise, the distance education will divulge the fulltime education at universities and colleges. If the state authorities will promote and enhance the popularity of distance education, this strategy will add to the process of tuition fees reduction.

I-Search Paper


a. Before I started conducting my research on the topic of reasonability of the college tuition fees’ raise, I knew that the universities applied to various methods to multiply the revenue of their establishments. The administration attracted foreign students with low level of IQ and general development and declined talented students due to the inability to pay the increased entrance fees.

b. Before I started my research, I believed that the fees tuition is the price stated at some governmental level. In fact, the system of higher education is mostly out of state control. Higher educational institutions establish the level of fee in accordance with the laws of supply and demand in the free market. I believed that attending university according to the fulltime schedule was the only way to get a quality higher education.

c. I chose the topic because it reveals the problems of many students in the USA and worldwide. I wanted to analyze the quality, value and alternative approaches to the education fulfillment. I wanted to understand the role and essence of the service provided by modern colleges and find a solution for a problem of constantly increasing tuition fees.

d. When I started my research, I had an intention to analyze the efficiency of higher education system. I hoped that I could suggest the winning solutions for myself and the state authority
e. The solution to the problem of tuition fees reduction is in promotion of the distance education on the state level.


a. My research process started with reading and analyzing books and surfing the relevant sites on the Internet (Western Governors University). I found many sources confirming the idea that distance education has a very strong potential in substituting the traditional form of university attending. I made notes and wrote a draft. I tried to find the sources where the authors were explicit and clear in their views and gave statistical evidence supporting their claims. I analyzed the site of Western Governors University and found out that distance education offers a great variety of opportunities and promises the relevant quality and assessment. I also discussed the problem with my friends who shared their experience and opinion on the real and desired state of affairs.

b. I found the best information in the books Tuition Rising: Why College Costs So Much by Hrenberg, and The Higher Education Bubble by Reynolds. The authors underlined the fake and unreasonable claims of the university authorities with relation to the fees and the quality of service provided. Reynolds emphasizes a necessity of tuition fees reduction in the situation of going far ahead inflation. Hrenberg witnesses the cases of power centralization and unfair redistribution of the university income on the highest administrative level. The scholar describes a higher educational system as a monopoly.

c. The greatest success I see in the perception and reflecting on the idea of a shift from traditional academic learning to distance education. The book by Leslie Moller, and Jason Huett, The Next Generation of Distance Education: Unconstrained Learning proves and clarifies this idea.

d. It was difficult for me to detect the peculiarities of the funding process and the distribution of the money among the university staff and administration. I tried to analyze and perceive the advantages of governmental intrusion into the system of higher education and found out that, in modern digital world, the intrusion should be on the level of distance education promotion.

e. My friends were helpful in understanding the problem from the inside and its relevance to the current situation in the sphere.

f. I had setbacks in finding the relative statistical information, and analyzed and compared different sources on the issue.

g. Throughout my work on the paper, I realized that students have a choice and privilege with the access to the Internet and numerous sources of information. The task remains in proper self-organization, timing and will. Assessment remains the prerogative of the university. It would be helpful to make the system of testing more transparent and centralized.


a. The main finding of the paper is the provision of a solution to the raised tuition fees problem. Through assessment and evaluation of the modern system of higher education in the USA, I detected distance education as an alternative for the students and threat for the traditional funding of universities provided by high tuition fees. The outcome lays in the passing of a great proportion of students to the alternatives of the remote individual studies. Creative human potential should become and remain the highest priority of the universities that care for their credibility. The paper discussed the invalid reasons for the tuition fees’ increase and the correlation between private and state funding in the system of higher education. The speedy development of science and technology demands from students an utmost mobilization and rationalization of their personal income distribution in a pursuit for higher education completion. The paper showed the current competition between fulltime and distance forms of learning.

Motivation to improvement comes from the students themselves, and the task of the university is in creation of the credible scientific environment with the open critique and problem discussion. Despite the high ratings, many of the American universities focus on the infrastructure and learning facilities improvement. However, knowledge comes through the inner motivation to studies, love to the subject, and involvement in the process of learning.

Development occurs in the cases of crises, competition and revelation. High tuition fees drive students in the search for sponsors and relevant sources of income while they need to focus on the professional growth. Such situation makes many of the applicants reject from traditional academic learning and apply to distance education service. It creates the situation when universities loose students in number and, consequently, do not have the expected profit.

b. “America is Facing higher education bubble” (Reynolds12).
“Consumers’ status ultimately erodes students’ autonomy and reduces learning toan instrumental focus on credit accumulation” (Williams 32).

“Control of the learning process is shifting away and into the hands of learners” (Moller and Huett 33)


a. Conducting my research, I have learned that a choice in favor of distance education can be considerably lower my expenses on studies. At the same time, I will help to develop research skills as well as self-control, and learn to use my time effectively and work autonomously. Reading about a problem and discussing it with friends gave many insights into its essence and significance.

b. While working on my paper, I mobilized my inner sources and conducted a profound research of credible sources, and it gave me new insights for my future career and inspired my confidence. At the same time, I felt difficulties with detecting the statistical data in different sources and comparing them.

c. Conducting a research the next time, I will try to find more apt direct citations.

d. I hope the paper will inspire confidence and aspiration in the students who feel frustrated due to the raised tuition fees. The positive changes have already marked in the salvation of the problem because currently many colleges already experience the lack of students. State authorities should promote and support the distance education as an alternative to the academic higher education. It will make the authorities of universities reconsider the reasonability of the high tuition fees.

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