Footing the Tuition Bill

What this book actually teaches

Footing the Tuition Bill (2007) by Frederick M. Hess — a resident scholar at the American Enterprise Institute and a prolific writer on education policy — is a policy-oriented examination of college financial aid rather than a consumer guide to paying for college. The book's central argument is that the college financial aid system, as structured in the mid-2000s, creates perverse incentives that drive tuition inflation, obscure real costs from families, and distribute aid in ways that frequently serve institutional interests rather than student or public interests. Hess writes primarily as a policy analyst rather than as a financial planner, and the book's value is in understanding the structural dynamics of college finance rather than optimizing a family's individual college savings strategy.

The first section of the book examines how the aid system evolved from its original purpose — expanding access for low-income students — into a sophisticated price discrimination mechanism that allows colleges to charge high sticker prices while offering strategic discounts calibrated to enrollment goals. Hess documents the shift from need-based to merit-based aid, the rise of "enrollment management" as an institutional function, and the role of the FAFSA and Expected Family Contribution formulas in creating information asymmetry that disadvantages families who don't understand how college pricing actually works. The analysis is drawn from institutional research and policy literature rather than from original reporting, but it is well-organized and more substantive than the typical consumer-side treatment of these dynamics.

The second section examines the policy interventions — federal loan programs, state grant structures, tax benefits for college savings — and assesses each for its effect on tuition inflation and access. Hess's assessment of federal student lending is consistently skeptical: his argument is that the availability of federal loans enables tuition increases by providing colleges with a captive demand source, and that the programs designed to make college more affordable have contributed to making it more expensive. This argument was not novel in 2007 — the "Bennett hypothesis" (named for Reagan education secretary William Bennett) had been circulating since the 1980s — but Hess synthesizes the evidence more clearly than most popular treatments.

The weaknesses are inherent to the genre. This is a policy book, not a planning guide, and families looking for concrete advice on 529 plans, aid application strategy, or school selection will not find it here. The 2007 publication date means the book predates the significant expansion of income-driven repayment and Public Service Loan Forgiveness programs, which altered the risk calculus for student borrowing in ways Hess's framework does not account for. The AEI affiliation signals the ideological orientation: Hess is skeptical of federal intervention and generally sympathetic to market mechanisms, which shapes which policy alternatives he takes seriously.

For education policy researchers, journalists, or policy-engaged parents who want to understand the structural dynamics driving tuition inflation — rather than optimize their own family's aid strategy — this book provides a well-grounded and readable account of how the system was built and why it produces the outcomes it does.

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About Frederick M Hess

Read more from Frederick M Hess and explore the full bibliography on ClearValue Books.