Ordinarily this would be a good time for me to make some erudite comparisons between the two presidential candidates’ education plans, but it seems like only one has any. So instead I’ll remind you of a Federal Reserve Bank of New York staff report, originally published last year and updated this spring, that demonstrates a correlation in availability of student loan dollars and increases in college tuition. Specifically the report shows that increases in the availability of student loans results in increases in college tuition, especially at for-profit schools. In fact the report cites an earnings call by The Apollo Education Group, one of the nation’s largest for-profit college operators (Apollo operates the University of Phoenix, among others), in which then-president Brian Mueller said, in response to a question about why the group had raised tuition the amount it had:

“The rationale for the price increase at Axia had to do with Title IV loan limit increases. We raised it to a level we thought was acceptable in the short run knowing that we want to leave some room for modest 2 to 3% increases in the next number of years. And so, it definitely was done under the guise of what the student can afford to borrow.”

Got that? The schools increased tuition based on more loans being available to students, not based on any measure that improves educational attainment or quality. To be fair, the report points out that this trend is more prevalent in for-profit schools:

“In terms of changes in subsidized loan caps, private institutions and non-four-year institutions (community colleges or vocation institutions) displayed the largest tuition sensitivity, as did those that charged higher tuitions… For-profit institutions experienced significantly larger increases in disbursed aid over the years of the aid cap changes. Correspondingly, these institutions also displayed sticker tuition increases of about $212, on average, as compared to $56 for non for-profit institutions. These larger tuition increases are consistent with the results in the paper and the heavy reliance of for-profit institutions on federal student aid.”

Now, let’s return to our candidates. If it’s true that profit-seeking schools have been increasing tuition in response to greater availability of aid, leaving students with higher loan burdens and less disposable income without a commensurate increase in the quality of education they received, that might be a problem we as a nation want to solve. Here is the National Association of Student Financial Aid Administrators’ comparison of the two candidates’ higher education proposals.