Washington Post: When faculty, facilities and reputation fail to attract stellar students, many American universities sweeten their admissions offers with cash. So-called merit scholarships can mitigate the bite talented students and their parents feel when tuition bills arrive, and they give colleges a chance to edge out their competitors for the best students.
The problem is that too often, merit money goes to families that don't need the help, to the detriment of need-based financial aid programs. The Wall Street Journal reported last week that in the decade ending in the 2003-04 school year -- the last school year for which data are available -- intense competition among colleges caused the amount of cash schools devoted to merit scholarships to shoot up. School and government merit aid increased from 1.3 billion in 1993 to 7.3 billion in 2003.
In 2003-04, according to Pennsylvania State researcher Donald Heller, 30 percent of the merit money colleges distributed went to families that made 92,400 or more a year. Only 20 percent went to families earning 33,350 or less. The amount of need-based aid roughly doubled over the same period, yet many students still find it difficult or impossible to pay for their educations.
A 2002 U.S. Education Department study reported that every year 170,000 qualified high school students will not be able to afford to attend college.
It's good to hear, then, that some colleges are shrinking or dropping their merit scholarship programs. Growing controversy over merit scholarships has convinced institutions such as the University of Florida to lower the amount of money they devote to grants to gifted students. Ivy League schools offer no merit awards.
The Journal also reported that groups of private colleges in Minnesota and Pennsylvania are considering asking the Justice Department for an exception to federal antitrust rules in order to decrease merit aid in concert. They should, and the Justice Department should give it to them.