Thomas Sowell

The latest academic scandal is that scholarships are beginning to be based on— scholarship. Those people whose personal experience has been confined to the real world may have to reorient themselves to the academic way of thinking, in order to understand why it is considered scandalous to base financial aid on a student’s academic achievement level.

For several decades, colleges and universities have been following a policy of basing financial aid, not on the student’s academic performance, but on "need" as defined by some rigid formula. The idea of providing financial incentives for students to excel academically in high school, or investing the scholarship money in a way that gets the most bang for the buck, has been anathema in academe.

In other words, the most marginally qualified student, who just barely managed to get admitted to the college, was entitled to as much financial aid as a class valedictorian with straight A’s and stratospheric test scores. If the student who just barely made the cut happened to come from a family with not as much money as the valedictorian’s family, then the scholarship money would be greater for the weaker student.

Strange as this might seem to those beyond the ivy-covered walls, it is perfectly consistent with the whole mindset that pervades the academy. The ideal is "fairness" in the sense of equalized conditions.

Increasingly, in recent years, there have been expressions of regret and much hand-wringing as this ideal has been eroded. Two things have brought this on. First, blank checks from government to academia are no longer available to finance every program, policy, or illusion that becomes fashionable on campus. Second, a Justice Department antitrust investigation of collusion among colleges put an end to an incredible cartel that had developed among the top trend-setting institutions.

For more than three decades, financial aid officials from Ivy League colleges, MIT, Amherst and other such institutions met each spring to compare what each of them was offering as financial aid to each of the students applying to more than one institution in this cartel. The net result was that financial aid from each member of the cartel would be set so that the student would have to pay the same net amount, regardless of which of these institutions he or she chose to attend.

Since the tuitions listed in college catalogues are simply list prices that are seldom actually charged, what was called "financial aid" was often more like discounts from the list price, such as are common in many commercial transactions. The cartel was essentially engaging in price discrimination, violating antitrust laws.

Once this cartel was broken up, its members began competing with one another for the best students. That is how scholarships came to be based on scholarship, much to the anguish of academic utopians.

"We are experiencing a heaping on of greater privilege to wealthy and middle-class kids," according to Professor Morton Schapiro of the University of Southern California. The way he sees it, "the poor" are being "restricted" to community colleges and are "even being squeezed out of four-year public institutions."

Those unfamiliar with academic Newspeak may need a translation: Students who do well academically are receiving a "privilege" rather than a reward when they get scholarships, because they are likely to come from middle-class or higher-income families, who promote academic achievement among their children. It is "unfair" in some cosmic sense that some children come from education-minded families and others do not.

While youngsters from low-income families who do well academically are equally eligible for scholarships and admission to elite colleges, their academic levels often will not get them past the community college levels. A further "injustice," from this perspective, is that a growing unwillingness to finance high school "remedial" courses in college means that those students who have not bothered to get prepared for college will be "squeezed out."

In this Alice-in-Wonderland world, "merit" is a dirty word and things like incentives and rewards smack too much of the world of business, to which academics feel vastly superior. The question is not why academics think this way. The question is why so many others go along with them.