College Costs Skyrocketing

A new report suggests there is a crisis in American higher education and the losers are parents.

The College Cost Calamity, published in the Economist, says universities have been enrolling more students and jacking up their fees. The average cost of college per student is three times the rate of inflation since 1983. And the cost of tuition alone has soared from 23 percent of median annual earnings in 2001 to 38 percent in 2010.

But even these huge increases have not helped universities deal with their debt and bleak future. The same report looked at the cash flow statements of more than 1600 universities and colleges between 2006 and 2010 and found that one-third were significantly weaker than previous years and their long term debt is growing at 12 percent a year.