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The Best Things In Life Are Worth Paying For

According to its institutional lore, 19th-century industrialist Peter Cooper founded Cooper Union to provide a higher education that is “as free as air and water.”

But air and water - at least air and water that anyone would want to consume - are definitely not free. Neither, of course, is education.

The water system that sustains New York City extends 120 miles to the Catskills. This engineering feat was completed in 1915, largely by low-paid immigrant workers. Much of the system crumbled in the ensuing decades due to neglect and underfunding for repairs. As New Yorkers’ water bills rise, the fact that clean, reliably delivered water is not free has become obvious. Clean air, meanwhile, costs money in the form of pollution controls, substituting cleaner fuels for dirtier ones, and other regulations.

An education at Cooper Union was never free either; it was simply paid for through stewardship of the wealth with which Cooper endowed the institution. A tenured faculty certainly isn’t free. It isn’t even cheap. Neither is maintaining and updating century-old property that sits on prime real estate in the middle of Greenwich Village.

Until recently, however, none of those costs fell to Cooper Union’s students. Last week marked the end of that era. The chairman of Cooper Union’s board of trustees, Mark Epstein, addressed students and faculty to announce a new policy: a “steeply sliding scale” that will determine how much, if any, of their tuition newly enrolled students are expected to pay. Those students on the high end of the scale will pay around $20,000 per year. Other students, with greater demonstrated need, will continue to attend the institution’s renowned programs in art, engineering and architecture on full scholarships.

Cooper Union’s trustees are not so much turning their backs on tradition as turning to face a reality that was always present, but previously overlooked. If Cooper’s ideal of a “free” education is unsustainable, then what is the essence of that ideal? The trustees concluded that it consists of providing an affordable education to as many of its students as possible. It seems like the right decision, especially if the alternative could have been the school’s eventual financial collapse. (The New York Times, citing Cooper Union president Jamshed Bharucha, reported that Cooper Union currently operates at a deficit of $12 million.)

Like nearly all excellent colleges today, Cooper Union is discovering that the only way to educate the poorest students for free is to take money from their better-off peers. Most schools accept a sizeable number of high-revenue students (foreigners and out-of-staters at state institutions, and affluent students paying full freight at private ones) to subsidize the rest. If its fees max out at $20,000 or so, Cooper Union will remain a value standout among its academic peers.

It will be interesting to see how selective Cooper Union remains once the free ride for students is over. Almost certainly, the school will fall in college rankings, because its applicant pool is bound to shrink once the allure of a tuition-free education is gone.

College rankings, however, are not as important as college missions. Neither are the traditions and myths that claim education is, or even should be, free. Those who are unhappy with the decision should also consider: If Cooper Union were forced to close its doors due to financial hardship, it wouldn’t be educating anyone at all.

Life is full of trade-offs. The school’s trustees made the most intelligent compromise they could under the circumstances. In order to pay for students’ education, they had to shatter the illusion that education can come without a price tag.

Larry M. Elkin is the founder and president of Palisades Hudson, and is based out of Palisades Hudson’s Fort Lauderdale, Florida headquarters. He wrote several of the chapters in the firm’s recently updated book, Looking Ahead: Life, Family, Wealth and Business After 55. His contributions include Chapter 1, “Looking Ahead When Youth Is Behind Us,” and Chapter 4, “The Family Business.” Larry was also among the authors of the firm’s book The High Achiever’s Guide To Wealth.

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