The Elite Universities Cartel: A History of Anticompetitive Collusion Inflating the Cost of Higher Education

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

objection. The chair is authorized to declare recess at any time. We welcome everyone to today's hearing on collusion in higher education. Without objection, I ask unanimous consent for Mr. Nehls to be permitted to participate in this hearing to question the witnesses if a member yields him time for that purpose, of which I will yield him 5 minutes. I'll now recognize myself for an opening statement. According to the National Center for Education Statistics, U.S. colleges and universities are $700 billion—a $700 billion industry. Harvard's endowment alone, which stood north of $50 billion as of 2023, is larger than the GDP of 120 nations. Six of the eight Ivy League schools have endowments exceeding $10 billion. Ivy League schools should be competing to offer the best product at the best price possible. Instead, they collude to raise prices and spend their inflated cartel earnings on administrative bloat. According to the Bureau of Labor Statistics, while products like cars, clothing, and TVs have become more affordable as businesses reduce costs to attract buyers, the cost of college tuition and textbooks has risen by more than 180% and, respectively, continues to go higher. Today, the cost to attend an Ivy League school can exceed $100,000 per school year. Ever since the Ivy League was established in the 1950s, these schools have been focused on exclusivity, maximizing profits, and artificially inflated prestige rather than expanding access to education and serving students. In 1950, Harvard charged $600 a year for tuition. Today, that number is nearly $60,000. Not only has tuition skyrocketed, but these schools are also deliberately keeping class sizes small to maintain exclusivity and inflate their perceived prestige. Between 1978 and 2023, while the U.S. population grew by just 50% and the number of applicants increased by 450%, Harvard reduced its class sizes by 258 seats. Across all Ivy League schools, demand has steadily increased, yet admissions remain flat. As you can see from the graph displayed, although each Ivy League school on average receives more than 50,000 applications, it accepts less than 2,000 students per year. These price increases and shrinking class sizes are not coincidental. Ivy League schools have a history of coordinating pricing practices to avoid competing on cost. In 1958, MIT and the eight Ivy League schools formed what is widely known as the, quote, "Ivy Overlap Group," a cartel to fix prices. These schools agreed to use a shared formula for calculating financial aid, ensuring students admitted to multiple schools would pay the same price no matter where they went. In 1989, the Department of Justice began investigating these practices and ultimately filed an antitrust lawsuit. By 1993, all nine schools had settled. In response, Congress adopted Section 568 of the Improving America's Schools Act of 1994, granting colleges an antitrust exemption, provided they did not consider a student's ability to pay while making admissions decisions. In 1999, elite schools formed a new cartel: the 568 Presidents' Working Group. The goal was the same: to create a shared financial aid formula and not compete for students based on price. Even with a legal exemption, these elite schools still chose profit and prestige over access and fairness. In 2022, former students sued many of the Ivy League schools for colluding on financial aid formulas that favored wealthy applicants. In one internal document uncovered through discovery, a college administrator complained about not being able to find enough qualified students with well-off parents to pay the high sticker prices. She said, quote, "sure hope the wealthy next year raise a few more smart kids." Ivy League schools can maximize the price paid by each student using detailed financial data collected through the College Scholarship Service Profile, or the CSS Profile. It is a comprehensive financial aid form that most colleges do not require. The CSS Profile gives these schools access to sensitive information, including family homeownership, savings and retirement accounts, and more. With that information, they can determine how much a prospective student's family can apparently afford to pay and then charge them that amount. Despite valuing their degrees at nearly $400,000, having multibillion-dollar endowments, and receiving billions more in taxpayer funding, these schools don't prioritize accessibility or quality of education. They prioritize profit and prestige. And even though the Ivy League schools no longer have an antitrust exemption to coordinate on pricing, tuition continues to skyrocket. By setting the industry standard for tuition, the Ivy League creates an umbrella effect that allows other colleges to charge more than they could in a competitive market. Today, we are starting an overdue conversation about how the Ivy League's anticompetitive practices may harm students, taxpayers, and ultimately our country's future. I want to thank the witnesses again for appearing before us today, and I look forward to your input. I will now recognize the ranking member, Mr. Nadler, for his opening statement.

Ranking Member Jerrold Nadler (D-NY)SPEAKER_02

Mr. Chairman, before before I start my opening statement, let me mention a personal stake in this. I am the first member of my family to go to college. We didn't have much money. My father worked on a gas station, and I was offered full scholarships by two Ivy League colleges, Yale and Columbia. I chose Columbia, and I never had to pay a cent. Mr. Chairman, this hearing, like so much else that we have done in this committee under Republican control, takes a serious issue and uses it as little more than an excuse to launch a decidedly unserious so-called investigation. Let's be clear: The cost of tuition at many colleges and universities, not just Ivy League institutions, is too high and is unaffordable for too many families. But the same Republicans who today claim to be concerned about the ability of students and their families to afford college tuition proudly cast their votes 2 weeks ago for a budget reconciliation bill that would take direct aim at student loan programs and other vital student aid. If they really cared about consumer prices, they would not undermine the ability of all students, especially low-income students, to access and afford higher education. They would not make cuts to Pell Grants that would reduce or eliminate access for up to 4 million students. They would not cut student loan subsidies, raising costs for an average borrower by up to $200 a month. They would not make student loan repayments even more difficult and push more students into the predatory private loan market. And they would not include devastating cuts to Medicaid, which will deprive roughly 3.4 million low-income students of much-needed healthcare. But Republicans showed us very clearly that their priority is tax cuts for billionaires, not affordable higher education. So it is a little difficult to take their concerns seriously today. This hearing also comes in the context of the Trump administration's all-out assault on education and research at colleges and universities across the country, and particularly at Ivy League and other elite universities. The administration has slashed billions of dollars in research grants to universities, which will set back technological innovation and medical advances by decades, not to mention harming our economic growth. At the same time, they are revoking student visas and sending an unmistakable message to prospective students around the globe that they are not welcome. The result is that the brightest minds in the world, who once flocked to this country, will now look to bring their brains and talents elsewhere. But this attack on higher education has an even more sinister purpose. Its real target is academic freedom. Taking a page from the authoritarian playbook, the Trump administration is using every tool at its disposal in a pressure campaign to impose its ideology on independent academic institutions and to bend them into submission. And unfortunately, they have a willing partner in the Republicans on the Judiciary Committee. Instead of using their power as legislators to make education cheaper, more accessible, and easier to pay off for all Americans, Republicans are using the power of this committee to aid and abet President Trump's ideological war against a very narrow slice of higher ed institutions. How absurdly narrow is their focus? They are targeting eight schools out of about 4,000 in the United States. That amounts to a focus upon less than one-half of 1% of the American undergraduate population. While President Trump threatens individual schools with cuts for not adhering to his ideology, they are using the power and resources of this committee to pursue yet another empty antitrust theory so that they can bully their political targets. Sadly, this follows a familiar pattern. Last Congress, this subcommittee unleashed baseless antitrust investigations designed to undermine the free speech rights of advertisers and investors that held views disfavored by the majority. When advertisers made the reasonable determination that they did not want their brands associated with extremist views and hate speech on social media platforms, Republicans used a flawed antitrust theory to justify a campaign to threaten and intimidate them into abandoning their efforts at responsible advertising. When investors threatened the profits of big oil and gas companies by considering the risks that climate change posed to our economic future, the committee rushed to the defense of their corporate allies with another hollow antitrust investigation. And now today, they return to the same tired playbook, using the power of this committee to support the Trump administration's efforts to target academic institutions. After having launched an overbroad fishing expedition against Ivy League universities, they're now holding a hearing today to justify these efforts at harassment and intimidation. As I noted at the outset, there are real concerns when it comes to the cost of tuition at colleges and universities. If there is indeed collusion among the Ivy League schools, enforcement by our antitrust agencies, the Federal Trade Commission and the Department of Justice, is the answer, not a partisan probe that merely serves as another broadside against education in America under President Trump. There is much we could do together to bring down the cost of tuition and broaden access to education. Unfortunately, Republicans would rather slash student loans to pay for tax cuts for billionaires while threatening universities that do not bend to Donald Trump's will. Unfortunately, there is one clear loser in the Republican war on science and education. It is the students they claim to support. And I should add, the public that benefits from scientific and medical discoveries that will not now happen in the United States. I appreciate our witnesses for appearing today. I look forward to hearing from them, and I yield back the balance of my time.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Gentleman yields back. I now recognize chairman of the full committee, Mr. Jordan, for his opening

Full Committee Chairman Jim Jordan (R-OH)SPEAKER_06

Thank you, Mr. Chairman. So first, they set the same general price. Then second, they demand large amounts of information from the student and their family for each student, and then they squeeze every dime they can out of that family for tuition. And then third, they limit class size. So they agree on price, they perfect price discriminate, and they limit output. That's about as anticompetitive behavior as you can get. And then with this windfall of money they get—perfect price discrimination, collusion on the price, limiting the class size at the at the institution—this windfall of money they get from students and their families and the government, the taxpayers, they hire an unbelievable amount of administrators. Mr. Shieh has pointed that out. Such a deal. Such a deal for taxpayers and families. That's what's going on. And thank goodness the chairman's having a hearing on this. It's ridiculous and everyone knows it. Not to mention all the crazy things we saw and witnessed at these institutions over the last few years—all kinds of crazy protests, taking over buildings, antisemitic behavior. I mean, not to mention all that. That's what's going on. And the ranking member of the subcommittee says we're wasting our time? You've got to be kidding me. The taxpayers appreciate that their tax money actually is used in the right way, not like it's being used at these institutions. So again, I want to thank the chairman for this hearing. I look forward to our witnesses and thank them for being present today and testifying. With that, I yield back.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Gentleman yields back. I now recognize the ranking member of the full committee, Mr. Raskin, for his opening statement.

Full Committee Ranking Member Jamie Raskin (D-MD)SPEAKER_10

Thank you very much, Mr. Chairman. Thanks to our witnesses for joining us today. Republicans convened us in the middle of the night a couple of weeks ago to pass their billionaire tax break bill, which even Elon Musk, their great hero, now calls a disgusting abomination, another class war tax scam that will not only throw 14 million Americans off of their Medicaid, but increase the national debt by $3 trillion. In case our friends missed it, Elon Musk, who you've been praising since this administration began, has a message for you today: shame on you, shame on those who voted for it. You know you did wrong, says Elon Musk. So, I was pleasantly surprised to see we were going to have a hearing on antitrust, because there used to be Republicans like progressive trustbuster Teddy Roosevelt who actually believed in protecting the American people against price-fixing conspiracies, monopoly, and runaway corporate power. I thought perhaps, Mr. Chairman, we could get together to protect our personal data, to investigate alleged monopolization of live events tickets, and lower prices on everything from eggs and other groceries to credit card junk fees, which have been soaring under the Trump administration despite his promise that he would lower the price of eggs and everything else on day one. Silly me. Like everything else, antitrust in the hands of our friends is just one more chance to attack America's colleges and universities that refuse to surrender control to that luminary academic scholar Donald Trump, who wants the federal government to take over faculty hiring, student admissions, and academic affairs at every university in America. And I don't even know why Donald Trump's so mad at Harvard. They let in his son-in-law Jared Kushner after the Kushner family donated $500,000 to get him in, just like Trump pardoned Kushner's father Charles, a major Trump donor who's our new ambassador to France, for his multiple convictions for tax evasion and witness tampering. Now, that would be a worthwhile hearing, Mr. Chairman: how wealthy people like the Kushners and the Trumps buy their way in to America's elite institutions, as Donald Trump calls them. But antitrust is now just a weapon of political attack, not economic analysis. When businesses advocate sustainable investing, House Republicans accuse them of violating antitrust. When consumers want to exercise their right to boycott, Republicans accuse them of violating antitrust. Gee, if you don't support their monstrous, ugly tax break bill for billionaires, they'll accuse you of violating antitrust. We'll probably be having a hearing on how Elon Musk is now violating antitrust since he's turned against Donald Trump and their appalling bill. So, today they're accusing eight universities, who represent less than 1/2 of 1% of undergraduate students in the entire market across America, of engaging in some completely vague and massive antitrust conspiracy. Republicans actually trotted out this pathetically weak theory in the first Trump administration. And, of course, no antitrust scholars took it seriously, and even their own Department of Justice didn't do anything with it. They control the Antitrust Division again. Why do they need another hearing in this committee? Why don't they just bring their case if there's a case? They've got the power. That's what they've been talking about. Look, this is pure power politics. President Trump's attacks on higher education reflect a standard move by authoritarians like Vladimir Putin in Russia and Viktor Orbán in Hungary. This is right out of the dictator's playbook: subdue and control any institution that could provide a check on your lying and your corruption; prevent any possibility of opposition and dissent from forming against the autocrat and his regime; clear a path for the agents of propaganda and disinformation; and destroy the institutions that have given us great advances in scientific discovery and intellectual inquiry, as Mr. Nadler points out. JD Vance gave the whole game away, by the way, when he repeatedly quoted Richard Nixon to say the professors are the enemy. Nixon said, The professors are the enemy. Write that on the blackboard 100 times and never forget it. Department of Education Secretary Linda McMahon ominously warned, if schools want to continue to do research, they must fall in line with the administration and its goals. They must be, quote, in sync with the administration and what the administration is trying to accomplish. That's a federal government takeover of every private and public university and college in America. Now, Harvard has stood up to the administration's attempted hostile takeover, rejecting its blatantly unconstitutional demands to control its governance, its curriculum, and the ideology of its faculty and students. In response, the administration has come after the university's research contracts and grants and, more recently, even its ability to enroll foreign students, only to be shut down by the courts—and not left-wing rogue Democrat judges, but Republican judges too—for violating the university's First Amendment rights. We've got academic freedom in America under the First Amendment. And now the Trump administration ridiculously threatens to come after the university's tax-exempt status. They want to revoke Harvard's tax-exempt status, and they've asked all federal agencies to cancel all of the contracts they have with Harvard to get the work of the American people done, contracted work. But Trump is losing in court every day and Harvard is winning as it stands up for academic freedom and its right to make scientific and academic progress. And hundreds of colleges and universities across the country are standing with Harvard. DHS head Kristi Noem has said that its actions against Harvard should serve as a warning to all universities and all academic institutions. After Trump canceled more than $1.5 billion in research grants, we know that state universities and community colleges have been have been hit hard. At smaller schools, researchers are going to lose their jobs, labs will close, and important work will go undone. Our Republican colleagues have no interest in making higher ed more accessible and more affordable. In their big, beautiful bill, they're cutting programs that help students pay for college, all to fund their tax cuts for the wealthiest Americans. Those cuts to higher education in America include severe limits on Pell eligibility, the end to subsidized loans, and a host of other destructive changes that will push college way out of reach for hundreds of thousands of Americans. The administration also proposed nearly an 80% reduction in federal work-study funding and eliminating support for childcare for students who are parents. What world are these people living in? This this is breathtaking duplicity to claim that the Ivy League schools are conspiring against their students to make tuition unaffordable when House Republicans are complicit in the largest setback in access to higher education for working-class Americans in decades. Not content to undermine American students through these direct cuts to education, they're also proposing cutting $880 billion from Medicaid and $300 billion from SNAP, the nation's primary anti-hunger program. Do you know what happens to millions of low-income students who don't have healthcare and don't have enough food to eat? Most of them are going to drop out of school. Today's hearing just regurgitates the MAGA agenda: persecute and punish anyone who refuses to submit to Donald Trump's right-wing ideological agenda or gets in the way of their plan to fund tax cuts for the wealthiest Americans on the backs of everybody else. It is a cruel, dangerous program, and it's got nothing to do with antitrust law. I yield back.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Gentleman yields back. Without objection, all other opening statements will be included in the record. We'll now introduce today's witnesses: Dr. Preston Cooper. Dr. Cooper is a senior fellow at the American Enterprise Institute, where his work focuses on higher education, student loans, and higher education reform. He previously served as a senior fellow in higher education policy at the Foundation for Research on Equal Opportunity, a research analyst at AEI, and as a policy analyst at the Manhattan Institute for Policy Research. Next, Mr. Alex Shieh. Mr. Shieh is a rising junior at Brown University, where he studies computer science and economics. He's also a journalist, serving as a contributing opinion writer for the Boston Globe and as the publisher of the Brown Spectator. Mr. Scott Martin. Mr. Martin is a partner and co-chair of the Antitrust Practice Group—excuse me—at Hausfeld LLP. He has spent more than 25 years in civil litigation, and his practice specializes in pricing, distribution, and other competition issues. Ms. Julie Margetta Morgan. Ms. Morgan is the president of the Century Foundation, a progressive think tank. She previously served as the associate director of Research, Monitoring, and Regulations at the Consumer Financial Protection Bureau. We welcome our witnesses and thank them for appearing today. We will begin by swearing you in. Would you please rise and raise your right hand? Do you swear or affirm under penalty of perjury that the testimony you are about to give is true and correct to the best of your knowledge, information, and belief, so help you God?

Rep. Troy Nehls (R-TX)SPEAKER_03

Yes, I do.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Let the record reflect that the witnesses have answered in the affirmative. Thank you, and you can be seated. Please know that your written testimony will be entered into the record in its entirety. Accordingly, we ask that you summarize your testimony in 5 minutes. And Dr. Cooper, you may begin.

Dr. Preston CooperSPEAKER_14

Good morning, Chairman Fitzgerald, Chairman Jordan, Ranking Member Raskin, and Ranking Member Nadler, and distinguished members of the subcommittee. Thank you for the opportunity to testify today on the enrollment and pricing practices of Ivy League universities. My name is Preston Cooper, and I am a senior fellow focusing on the economics of higher education at the American Enterprise Institute. The eight institutions of the Ivy League show many hallmarks of anticompetitive behavior. Most Ivy League institutions severely limit undergraduate admissions, turning away thousands of qualified applicants. The schools charge among the highest tuition prices in the country and are less likely to provide financial aid than other private institutions. At the same time, Ivy League universities enjoy a significant surplus that funds high levels of institutional expenditures, administrative bloat, and seven-figure salaries for some college presidents. Some Ivy League universities recently enjoyed an exemption from antitrust law, provided they admitted students on a need-blind basis. In 2022, a group of students filed a class-action lawsuit against 17 elite universities, including several Ivies, alleging that admissions are not actually need-blind. Most of these schools eventually settled the lawsuit for a collective $320 million. Another lawsuit was filed in 2024, alleging that elite universities have continued to coordinate their pricing decisions even after the antitrust exemption expired. My testimony does not take a position on whether Ivy League universities are coordinating their pricing decisions or whether they are in violation of federal antitrust law, but the enrollment, pricing, and spending practices of the Ivy League raise some red flags. Classic cartels limit supply in order to drive up prices and profits, and we observe a version of this happening among Ivy League schools. Let's start with restrictions on supply, a fundamental aspect of cartel behavior. Harvard College admitted about 2,200 students to join the class of 1982. Due to population increases and higher rates of overall college attendance, one might expect that number to grow. Instead, Harvard admitted just over 1,900 students to join its class of 2028. Unlike most other private colleges, Ivy League universities have mostly not increased admissions to match rising demand. Instead, the schools have opted to become more selective, with the average Ivy League admissions rate falling from 15% in 2002 to just 5% in 2022. As student demand rises, but Ivy League institutions keep admissions relatively flat, the obvious result is upward pressure on prices. The annual price of tuition and fees at Ivy League universities ranged between $59,000 and $69,000 in the previous academic year. That's between 56% and 82% higher than the average for private colleges. Ivy League students are also less likely to receive financial aid. While 84% of students at non-Ivy colleges enjoy a discount off the sticker price, the share of Ivy League students receiving institutional financial aid is just 52%. In a traditional cartel, restricted supply and higher prices enable monopoly-like profits. While nonprofit universities don't earn profits in the traditional sense, they still enjoy surplus revenues. Ivy League universities spend an average of $126,000 per full-time equivalent student, compared to just $35,000 for the average private college. These high levels of spending fuel a vast administrative bureaucracy. The average Ivy League institution employs one non-instructional staffer for every two students, compared to one staffer for every six students at other private colleges. All of this matters because Ivy League institutions have an outsized impact on the future of America. Ivy League graduates are vastly overrepresented among elites in business, politics, and media. A group of institutions which limits enrollment and charges excessive prices denies opportunity to thousands of students, particularly middle-class students with strong academic qualifications, who face an unfairly low likelihood of admission today. The surplus revenues that Ivy League institutions currently enjoy fuel administrative bloat, but they could instead be used to create more seats for qualified applicants. The market for elite education bears many of the telltale signs of anticompetitive behavior. Whether it meets the legal definition of a cartel is an open question, but it unambiguously leaves students and society worse off. Thank you for your attention, and I look forward to your questions.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Thank you, Dr. Cooper. We will now recognize Mr. Martin for 5 minutes.

Mr. Scott MartinSPEAKER_04

you, Chairman Jordan. Ranking Member Thank you, Chairman Jordan, Ranking Member Raskin, Chair Fitzgerald, Ranking Member Nadler, and distinguished members of the subcommittee. I thank you for extending an invitation to testify today. My name is Scott Martin. I'm an attorney whose work has focused on antitrust litigation for more than 30 years. That includes more than two decades primarily spent on defense work and the past 10 years principally litigating on behalf of plaintiffs. I'm also an author and co-editor of a multi-volume antitrust treatise. I care deeply about the benefits of competition and free markets, which is a truly bipartisan goal, as well as active, but fair enforcement of our nation's antitrust laws. As the members of the subcommittee know, the antitrust laws address both unilateral conduct, anticompetitive acts undertaken by a single actor with market power, and concerted conduct, particularly when the latter involves direct or horizontal competitors. Most of my remarks will be directed to the latter as an area of concern regarding higher education historically, principally the potential for cartel activity, which the United States Supreme Court has labeled the supreme evil of antitrust. In testifying today, I make no prejudgment about any current conduct, nor has my law firm represented a party in the cases I'll discuss. Indeed, the hope of antitrust lawyers is always that free markets are operating properly and that unlawful conduct is not interfering with that. But there are several reasons here for heightened vigilance to protect and encourage robust competition in higher education. First, as members of the subcommittee, as well as many American students and parents know, the price of higher education, specifically for private schools, has outpaced the rate of inflation. Since I was in college, the Consumer Price Index has inflated the dollar by a factor of three, but tuition prices at the most selective institutions in particular have gone up on the order of sevenfold. Meanwhile, output in terms of class size has not kept pace with population growth. This is true despite increased demand and increasing multibillion-dollar endowments. Common sense begs the question whether such a market is working properly. Second, the somewhat cloistered nature of these institutions, their nonprofit status, not to be confused with their massive endowments, and a belief, of which I am not questioning the sincerity, that they are engaged in noble work of the advancement of knowledge may create an atmosphere suggesting that relaxation of rules of competition would be appropriate for this industry. Not so. Most legal scholars will tell you not only that antitrust exemptions are rare, and rightly so, but also that special sectoral rules and regulation have at best a mixed track record in our nation. In a different higher education context, my law firm brought the O'Bannon case that challenged NCAA restraints on college athletes. That marketplace has flourished, and the sky has not fallen. And third, there are numerous markers here familiar to antitrust practitioners that this is a market ripe for distortion by collusion. Among other things, this is a somewhat concentrated industry with relatively few highly selective institutions as participants. There are numerous opportunities for those entities to collude, whether directly, such as at meetings of university presidents, or facilitated through intermediaries, such as the College Board. And there are, of course, exceptionally high barriers to entry into the market. As I mentioned by way of context, this industry has been the subject of investigations and litigation raising competition concerns in the past on issues ranging from no-poach agreements concerning graduate school faculty members to monopolization of markets and college for college bookstore sales and local housing. The Common Application, used by over 1,000 colleges and universities throughout the United States, also has been the subject of a private antitrust action, ultimately settled. And perhaps most pertinent to the subcommittee here, in 1989, as you've heard, the DOJ filed a civil antitrust case against a group of universities alleged to have employed the same analysis to compute family contributions toward the cost of attendance for purposes of collectively determining financial assistance offered to commonly admitted students. That case resulted in a 10-year consent decree in 1991 under which those universities committed not to agree on student financial aid, and subsequently to the congressional passage of the so-called 568 exemption, permitting colleges to formulate common approaches to awarding financial aid, provided they strictly adhered to need-blind admissions. 568 exemption expired on September 30, 2022, and was not renewed. However, as you know, current and former college students allege in a class action filed in 2022 that members of the 568 Presidents Group of 17 top private colleges and universities have conspired to eliminate competition among them for financial aid. To date, 12 of those 17 schools have resolved the lawsuit in settlements totaling approximately $320 million. I thank you again for your attention and your vigilance in this regard.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Thank you, Mr. Martin. Mr. Shieh, you may begin.

Mr. Alex ShiehSPEAKER_13

Chairman Fitzgerald, Ranking Member Nadler, Chairman Jordan, Ranking Member Raskin, thank you for inviting me to appear before you today. My name is Alex Shieh, and I'm a rising junior at Brown University, one of the most exclusive institutions in the world. But I'm not here to glorify the Ivy League. I'm here to warn you that the promise of American higher education, of opportunity through meritocracy, is under attack. I'm a legacy student at Brown. I went to a prep school that feeds to the Ivy League. My parents are doctors who can afford the $93,000-a-year sticker price. In other words, I'm exactly who the Ivy League was built for. But what about the kids who weren't born on third base? Statistically speaking, for a smart kid from a poor family, an Ivy League degree can power their ascent to the upper income brackets better than anything else. That's the American Dream. But today, that dream is now a luxury good. According to The New York Times, at Brown, the median student's family makes over $200,000 a year. Half the student body comes from the top 5% of earners, and research by Brown's own professor, John Friedman, shows that even equally qualified low-income students are vastly underrepresented. At this very moment, the American people are tightening their belts, and Brown is raising tuition to beyond $90,000 a year. And even while charging students the price of a luxury car, Brown is on track to run a $46 million deficit this year. Where's all the money going? I'll tell you where it's going. It's going into an empire of administrative bloat and bureaucracy. Brown employs 3,805 full-time non-instructional staff for just 7,229 undergrads. That's one administrator for every two students. This isn't education. This is bloat paid for on the backs of students and families who are mortgaging their futures for a shot at a better life. Meanwhile, Grace Calhoun, Brown's athletic director, earns over $1 million. A household assistant on payroll tends to University President Christina Paxson. And when budget cuts are made, these expenses stay while the student experience deteriorates. My dorm floods when it rains, and the burger patties in our dining hall have been replaced by an unappetizing beef-mushroom blend. The idea that Brown's administration can be streamlined isn't conjecture. We didn't use to have this many administrators. Across the nation, the number of university administrators has risen by 162% in recent decades. And it's no coincidence that, correspondingly, the cost of education has risen 181% in inflation-adjusted dollars since the '90s. Across the pond, a world-class education at Oxford or Cambridge can cost about half as much as an Ivy League degree, in part due to a much lower administrative burden. The status quo has a real human cost. I recently learned of a brilliant young man from Pensacola, Florida, who got into Brown but was forced to walk away because the financial aid wasn't enough. Brown says it meets 100% of demonstrated need, but Brown gets to decide what that need is. Middle-class students, in particular, suffer from these policies, earning too much to qualify for generous scholarships, but not enough to go to Brown without straddling themselves with significant amounts of debt. And let's not forget that Brown is one of several Ivy League schools that settled a federal antitrust lawsuit last year for allegedly colluding to suppress financial aid offers. I'm a reporter for The Brown Spectator, and to document this problem, I created a website called Bloat at Brown that used AI to assess whether each administrative role was actually necessary. I sent each administrative employee a DOGE-style email to ask them, What do you do all day? Instead of answering, Brown's response was retaliation. My Social Security number was leaked, our website was hacked, and Associate Dean Kirsten Wolfe launched a disciplinary investigation into a litany of baseless charges such as emotional harm. When they couldn't get me, they charged every single board member of The Brown Spectator, an unprecedented attack on student journalism. But we refused to back down, and we won our hearings. There was no misconduct, only exposure, and that's what Brown feared the most. This committee has a responsibility not just to investigate Ivy League antitrust violations, but to reclaim the American Dream from those who have twisted it into a racket. I call on you today to subpoena Brown's president, Christina Paxson, and ask her why Brown costs $93,000 a year. The American Dream isn't just for the legacies, the coastal elites, or the children of privilege. It belongs to the kid in rural Kansas with a 4.0 GPA, the first-gen student working a night shift, and the families who did everything right and still got priced out. They deserve a seat at the table. They deserve a shot at making it big. Their American Dreams matter, too. I thank you for the opportunity to testify, and I welcome your questions.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Thank you, Mr. Shieh. Dr. Morgan, you may begin.

Ms. Julie Margetta MorganSPEAKER_00

Good morning, Chairman Fitzgerald, Ranking Member Nadler, and members of the subcommittee. Thank you for the opportunity to testify at this hearing. The rising cost of college beyond high school in this country is a major concern for many American families. Whether they're looking at an associate's degree in nursing, a vocational certificate to become an HVAC technician, or a 4-year degree in business, Americans looking to get ahead in the job market are facing high tuition bills, and most families are forced to cope by taking on student loan debt that becomes a lifelong burden. I applaud the committee's interest in the cost of higher education. However, the focus of this inquiry is misplaced. Ivy League institutions train less than 0.4% of undergraduate students in this country, whereas the vast majority of students attend public community colleges and open-access state colleges. Ivy League admissions and tuition practices have no effect on the schools that most Americans attend. Looking for a solution to college costs in the Ivy League is like looking for a needle in a haystack while the rest of the haystack is on fire. And here's the latest source of that fire: legislation approved by the House of Representatives pays for tax cuts for the richest Americans by increasing the price of college for low- and middle-income students, including taking away Pell Grants from 1.4 million Americans and reducing them for another 3 million. The deep cuts to Medicaid and SNAP in that bill will also likely increase public school tuition by squeezing state budgets, as higher education will be at the top of the chopping block to cover state budget shortfalls. Antitrust at elite colleges is deeply inadequate for solving the problem of high prices of college in America. Attempting to leverage antitrust as a global fix to college pricing and admissions while simultaneously slashing federal support for higher education could very well result in less access to college for lower- and middle-income families, not more. Congress has powerful tools at hand that could really change the price of college and improve the value of the government's investment that are outside of this committee's jurisdiction. For example, the federal government could use its muscular role in higher education finance to the advantage of millions of American families by negotiating the price of college tuition. There's strong bipartisan precedent for this in Medicare, where the federal government assigns payment rates to healthcare services provided to Medicare beneficiaries. And while Ivy League practices don't trickle down to open-access schools, the predatory practices of for-profit colleges are definitely trickling up. Community colleges must contend with for-profit schools that siphon off students through aggressive marketing and then leave them with high debt and low earnings potential. As Congress looks to roll back regulation of for-profit colleges, these conditions will only worsen. Lastly, today's focus on Ivy League colleges comes after a string of actions by government leaders aimed at gaining unprecedented levels of control over the minutiae of administration at certain elite colleges. Instead of simply enforcing the law, federal officials are openly looking for any punitive measure that they can apply to bend a handful of wealthy, elite colleges to their will. Federal officials have put forward a variety of diffuse reasons for this obsession with the Ivies, but I think this line of attack, taken as a whole, is most reasonably viewed as an attempt to turn back the clock and restore the role of the Harvards and Yales of the world as finishing schools for the children of wealthy and well-connected, rather than knowledge centers that can freely evaluate and challenge social and political trends. This attack on Ivy League schools has worrisome parallels to the actions of an authoritarian regime. And regardless of our views on elite higher education, it should be of concern because it's a sharp departure from the law and from our norms and democratic values. A strong higher education system is critical to the country's economic strength, to the strength of our democracy, and to creating more broadly shared prosperity. We need to be working together to ensure that we are building a system that meets all of our communities' needs. Thank you, and I look forward to your questions.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Gentlewoman yields back.

Ranking Member Jerrold Nadler (D-NY)SPEAKER_02

Mr. Chairman,

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

gentleman's recognized. I

Ranking Member Jerrold Nadler (D-NY)SPEAKER_02

have a unanimous consent request.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Without objection.

Ranking Member Jerrold Nadler (D-NY)SPEAKER_02

Mr. Chairman, I ask unanimous consent to enter China Really Wants to Attract the Talented Scientists Trump Just Helped from today's New York Times.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Without objection.

Ranking Member Jerrold Nadler (D-NY)SPEAKER_02

Thank you. I yield back.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Thank you, Dr. Morgan. Now proceed under the five-minute rule with questions, and the gentleman from California is recognized, Mr. Issa.

Rep. Darrell Issa (R-CA)SPEAKER_01

Thank you. Dr. Morgan, you went to Boston College, also known as one of the New Ivies, right?

Ms. Julie Margetta MorganSPEAKER_00

did go to Boston College for law school. I have no idea whether it's called a New Ivy.

Rep. Darrell Issa (R-CA)SPEAKER_01

Google says it is, and who else can we ask? The bottom line is undergraduate is now over $67,000, over $88,000 all-inclusive. Is that one of the elite schools that you would be referring to beyond the original eight Ivy Leagues?

Ms. Julie Margetta MorganSPEAKER_00

Absolutely. I do think that colleges like—

Rep. Darrell Issa (R-CA)SPEAKER_01

And let me ask you a question. Since you made such a point that Boston College or that other colleges, the basic eight and we'll just add the new Ivies that charge similar amounts, they should be exempt from antitrust because they have a small market share and cater to the ultra-

Ms. Julie Margetta MorganSPEAKER_00

My testimony offers no opinion. No,

Rep. Darrell Issa (R-CA)SPEAKER_01

no, no. You, you, you, you made a point as an antitrust point that they, because they had such a small market share, they had little or no effect.

Ms. Julie Margetta MorganSPEAKER_00

I'm sorry. Can, can I answer the question?

Rep. Darrell Issa (R-CA)SPEAKER_01

No, I want you to answer that question.

Ms. Julie Margetta MorganSPEAKER_00

Okay. So the point I'm making about the— I

Rep. Darrell Issa (R-CA)SPEAKER_01

don't want to know the point you're making. You can say yes or no. Did you say that?

Ms. Julie Margetta MorganSPEAKER_00

Can you restate the question, please? What did I say?

Rep. Darrell Issa (R-CA)SPEAKER_01

You said, and I'll paraphrase, thank you very much. You said that, that, you know, that we shouldn't be concentrating on them because they had such a small market share. Is market share a factor in antitrust activity of multiple companies working together in collusion?

Ms. Julie Margetta MorganSPEAKER_00

I believe we should be focusing on— Now,

Rep. Darrell Issa (R-CA)SPEAKER_01

thank you for not answering that. You make it easy on me, Doctor. Mr. Martin, is collusion, even without large market share, if it's— if it makes prices unreasonably high, if it has an effect, is that antitrust behavior?

Mr. Scott MartinSPEAKER_04

It's per se unlawful.

Rep. Darrell Issa (R-CA)SPEAKER_01

Okay, so you have per se unlawful behavior alleged, and yet the Democrats' witness, for some strange reason, wants to say, Oh, don't look at that shiny object. Instead, what we heard today was give us more funding for the bloated state universities that also are raising their prices. Mr. Shieh, you described yourself as sort of part of the wealthy and entitled, which is unusual in this body for anyone. Everyone else seems to want to be Horatio Alger, but your family was able to pay what needed to be paid at an Ivy League school, correct?

Mr. Alex ShiehSPEAKER_13

Right. And most Americans can't afford this, though. $93,000 a year. That's like 150% of the median American income.

Rep. Darrell Issa (R-CA)SPEAKER_01

Okay. And the evidence that's being presented today is that the effect is not just Ivy League schools, but if you take away the subsidies being paid by other taxpayers, all universities are rising at very high rates because of these practices, including what you talked about, this massive amount of, uh, of overhead, if you will, inefficient overhead by administrators.

Mr. Alex ShiehSPEAKER_13

Absolutely. Administrative overhead is growing not just at the Ivy League but at state universities. All across the country. It's risen dramatically in recent years.

Rep. Darrell Issa (R-CA)SPEAKER_01

And Dr. Cooper, is it fair to say that one of the things you see among cartels, antitrust activity, and so on is you see higher prices and less efficient, higher overhead? Isn't that kind of a hallmark when you give antitrust exemption?

Dr. Preston CooperSPEAKER_14

That's correct. We often see higher prices and higher profits.

Rep. Darrell Issa (R-CA)SPEAKER_01

So for our witnesses, is it fair to say that if in fact we bring back real competition at all levels, at all universities, and as a result, we then would be able to drive down prices, drive up the efficiency, we could in fact allow more people to be able to leave college without burdensome debt.

Dr. Preston CooperSPEAKER_14

I think that's correct. Uh, we need more competition in higher education.

Rep. Darrell Issa (R-CA)SPEAKER_01

Okay. So today's hearing is really about antitrust behavior by the most esteemed university. And Mr. Shieh, I'm going to ask you a question. Is it your understanding, as a rising junior, if I'm correct, that if you go to one of these great universities, the rest of your life, your career income is, on average, greater, isn't it?

Mr. Alex ShiehSPEAKER_13

This is empirically true, is that going to an Ivy League school can definitely raise your potential earnings, especially if you're from a low-income family.

Rep. Darrell Issa (R-CA)SPEAKER_01

So, Mr. Martin, the tendency by the universities that will deliver the highest lifetime earning to restrict, to reduce, and as a result, to deny to the people who otherwise would have that opportunity, isn't that one of the real detriments of this antitrust behavior?

Mr. Scott MartinSPEAKER_04

It, it should trouble us as antitrust lawyers.

Rep. Darrell Issa (R-CA)SPEAKER_01

Thank you. I yield back.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Gentleman yields back. Now recognize the ranking member for 5 minutes.

Ranking Member Jerrold Nadler (D-NY)SPEAKER_02

Thank you, Mr. Chairman. Dr. Morgan, before I begin my questions, can you please say your answer to Mr. Issa question on market size?

Ms. Julie Margetta MorganSPEAKER_00

Yes, I believe that market size is relevant here to the question of where we should be focusing our attention. The vast majority of students in America do not attend Ivy League colleges, and they don't attend colleges who are affected by the competitive forces that the committee is discussing here today. We need to be focused on open-access colleges and community colleges, who take their cues from the state legislators and federal legislators who provide sufficient resources for their budgets.

Ranking Member Jerrold Nadler (D-NY)SPEAKER_02

Thank you. For many, college is a good investment that ensures greater earnings over a lifetime and an opening to the middle class. However, the cost of tuition at many schools is too high, closing the door to families who cannot afford the high sticker price. Despite this affordability problem and the growing disparity between the richest few and the many who are seeing rising prices in all parts of the market, the Republicans' reconciliation bill takes direct aim at student loan programs and other critical student aid programs. The Trump administration has also taken aim at students and universities while pulling critical research funding and kidnapping students and academics off the street. Dr. Morgan, how does the Republican budget impact low-income students and the public's access to higher education going forward?

Ms. Julie Margetta MorganSPEAKER_00

The Republican budget is going to have drastic negative impacts on the cost of higher education for most students in this country. As I said in my testimony, it's going to cut Pell Grants for millions of students, making them foot the bill for more of college. It's going to make student loans more expensive to repay on the backend. It caps the amount of federal student loans that people can take on, but not the amount of tuition, meaning that more people are going to have to take on private student loans to cover that gap.

Ranking Member Jerrold Nadler (D-NY)SPEAKER_02

And how does higher education support the country and our economy generally?

Ms. Julie Margetta MorganSPEAKER_00

Higher education is incredibly important to our economy, and it serves a number of purposes. Number one, those open access schools and community colleges that I referred to are educating people to become doctors— sorry, to become nurses, nurse practitioners, HVAC repair people, electricians, you know, the people who serve our communities every day and make our economy robust. But our educational institutions also provide funding for or receive funding to do research that provides innovations that are incredibly important to our society. Society. They make us safer, they make us healthier, and they make our country more competitive.

Ranking Member Jerrold Nadler (D-NY)SPEAKER_02

Well, following up on that, how does the gutting of federal research programs at the National Institutes of Health, the Centers for Disease Control and Prevention, and the National Science Foundation impact not just the institutions, but society and even humanity?

Ms. Julie Margetta MorganSPEAKER_00

I think we're all going to feel the impacts of these cuts for a long time. We're not going to be developing the drugs that make us safer and healthier in this country. We're not going to be developing the innovations that help keep us competitive and power manufacturing within our country. So it's going to have a really big impact on, on us as a whole. I also think that it's going to move more innovation to the private sector, which means that we're really only going to be developing the innovations that are profitable and not necessarily the ones that are best for, for the public as a whole.

Ranking Member Jerrold Nadler (D-NY)SPEAKER_02

And most of our drugs are not initially profitable without federal research. Dr. Morgan, the United States has been the beneficiary of foreign students coming here, being educated here, the best and the brightest, and staying here. It's one of the reasons for our scientific supremacy. What is the effect of the Trump administration's hostility to foreign students and denials of visas and even revocations of visas? What would be the effect on our economy and on our scientific primacy?

Ms. Julie Margetta MorganSPEAKER_00

Yes, I think that first of all, we have to view this attack on foreign students at American colleges as part of a larger punitive effort to bend certain colleges to the administration's will. So this is really part of an effort to kind of turn the screws in any place that the administration can to bring colleges around to a set

Ranking Member Jerrold Nadler (D-NY)SPEAKER_02

of— What would be the result?

Ms. Julie Margetta MorganSPEAKER_00

Oh, sure. So, um, I think the result of this, these, um, of, uh, this change to, um, to admission for international students is going to have an effect on our country's ability to bring in minds from all across the world and benefit from their academic excellence, um, to provide, um, you know, an opportunity for those students to take part in our democracy and learn our values.

Ranking Member Jerrold Nadler (D-NY)SPEAKER_02

In short, it promises to shift scientific primacy from the United States to China. Would you agree with that?

Ms. Julie Margetta MorganSPEAKER_00

I totally agree with that.

Ranking Member Jerrold Nadler (D-NY)SPEAKER_02

Thank you. I yield back.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Gentleman yields back. We now recognize the gentleman from Washington for 5 minutes.

Rep. Michael Baumgartner (R-WA)SPEAKER_07

Well, thank you, Mr. Chair, for holding this important hearing. There is zero doubt that the Ivy League institutions behave in an anticompetitive manner. In fact, if you look at their pricing and value and marketing model, it looks very similar to some famous jewel companies and how they control the supply of diamonds and inflate what is a commodity into a precious item of limited scarcity. But I do believe that American higher education is a gem of American society. What it does for research, social mobility, and overall aid to our economy is extremely important. Unfortunately, it's a gem that has been thrust into the mud largely by Democratic leadership. And Democrats are great if you're a college administrator and want to see your salary increase or your job supply increase; they're terrible if you're a college student and you don't want to see your debt levels increase. The right price for college should be the price at which a student can get through with zero debt. College should be priced at the level you can work a part-time job or a summer job. And, the problem with an 18-year-old is they don't know the difference between $6,000 in debt or $60,000 in debt. They've never had a job and had to pay it back. So what this body should be doing is how do we create an environment where all students can get through school with no debt? When I was in our state Senate, as Republicans, when we took control in the state Senate, we actually dropped the price of college tuition 20% in Washington State under Republican leadership because we were working for the middle class. I've had the experience of going to a big state school, Washington State University, where my father was a professor. I spent a year as a teacher at Catholic University of Mozambique teaching war refugees. I was a teaching fellow at Harvard when I did my master's there, and I was short-term on the faculty at Sciences Po University in Paris, which is kind of the Harvard of France. And across all those experiences, what I saw is that the amount of growth in administrators in American universities is simply out of control. When you go to Sciences Po, there's no diversity deans, student housing deans, student welfare deans. There is simply this reliance on college students to behave as adults and figure stuff out for themselves. In doing that, they're able to provide college at a much, much lower level. So what this body needs to do is to figure out ways to get all the BS out of higher education, get back to basics, and create mechanisms to bring costs down. Now, I do want to touch on this issue of the Ivy Leagues and Harvard specifically, which does have some real problems. When I went to Harvard, there was a lack of viewpoint diversity. We used to call the Republican Club the phone booth club because there were so few of us we could fit in a phone booth. Now I make that joke and a lot of students don't even know what a phone booth is. But in any event, the solution to this is just to make these universities reflective of American society. It's like Noah's Ark—just increase access and viewpoint diversity. This shouldn't be hard, except the fact the far left does not want to give up its stranglehold on America's most elite universities, but this is going to happen. Secondly, there is a problem with the Chinese government and foreign institutions utilizing America's most elite universities. When I went to Harvard, there was sort of a small-scale scandal that they refused to fly the flag of Taiwan at that time. And in fact, we have some important legislation here in this body in the DETERRENT Act, which we passed out of the House, that would illuminate how much foreign influence is going on in college campuses from places like China. And even today, Harvard resists implementing that bill. I'd like to enter for the record this column, this newspaper article that Harvard has trained so many Chinese communist officials, they call it their party school. So there very much is a problem of China at these universities, if I could enter this in the record. Thank you, Mr. Chair. And finally, I just want to thank all the panelists for fighting this antitrust issue. But as we think about these issues, we all need to realize that college enrollment is about to go off a cliff due to demographic changes in America. We have a silver tsunami of older Americans, and we have a dwindling, rapidly, supply of college students because of demographic factors in terms of birth rates and also the cost. So this anticompetitive behavior will likely become worse in coming years as the market, total market for college students, reduces. With that, I yield back.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Gentleman yields back. Mr. Nadler is recognized for unanimous consent request.

Ranking Member Jerrold Nadler (D-NY)SPEAKER_02

Mr. Chairman, I ask unanimous consent to enter into the record an article from New America titled "The House reconciliation bill makes college less affordable, all to pay for tax cuts for millionaires and billionaires" that argues low-income to moderate students will, quote, "borrow more, but with worse terms."

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Without objection.

Ranking Member Jerrold Nadler (D-NY)SPEAKER_02

Thank you. And I also seek unanimous consent to enter into the record 2 articles, one entitled The Number of 18-Year-Olds Is About to Drop Sharply, as the gentleman said.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Without objection.

Ranking Member Jerrold Nadler (D-NY)SPEAKER_02

And another entitled Declining Enrollment Is Leading to School Closures.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Without objection. The ranking member of the full committee, Mr. Raskin, is now recognized for 5 minutes.

Full Committee Ranking Member Jamie Raskin (D-MD)SPEAKER_10

And thank you, Mr. Chairman. Mr. Shieh, so you describe yourself as a son of wealth and privilege. I think you describe yourself as a legacy student. Does that mean your parents or your grandparents went to Brown?

Mr. Alex ShiehSPEAKER_13

Yeah, my father went to Brown.

Full Committee Ranking Member Jamie Raskin (D-MD)SPEAKER_10

But other than having some complaints like the beef mushroom blend, You're, you're really speaking not so much for yourself, but for other kids. You say the kids who are not born on third base, is that right?

Mr. Alex ShiehSPEAKER_13

Absolutely. I think the value of an Ivy League degree used to mean that that you were smart, that you're brilliant, but I think it's being diminished.

Full Committee Ranking Member Jamie Raskin (D-MD)SPEAKER_10

And as you know, the vast majority of young people who want to go to college are not going to be able to go to Brown, even if you increase the class size, as you've advocated, by a couple hundred kids. The vast majority are going to end up going to, if they can afford it, state universities, community colleges, and so on. So my question for you is, will you use your platform here today to oppose the major cuts in Pell Grants, which have allowed an avenue for upward mobility in education for young people, that are built into the current tax bill? 1.4 million Americans would be thrown off, and I just wonder if you would oppose the cuts to Pell Grants, the cuts to student loans, and the 80% cuts to college work study, which allows people to work their way through college.

Mr. Alex ShiehSPEAKER_13

Well, I think something that we've observed economically is that— No,

Full Committee Ranking Member Jamie Raskin (D-MD)SPEAKER_10

no, I'm going to— like my friend, I'm going to ask you to answer the question. Do you oppose all those cuts or do you support them?

Mr. Alex ShiehSPEAKER_13

I guess I believe that subsidizing education only increases the cost because— So

Full Committee Ranking Member Jamie Raskin (D-MD)SPEAKER_10

You favor those cuts. You would just get rid of the Pell Grant program, is that right?

Mr. Alex ShiehSPEAKER_13

I'm not an expert on the Pell Grant program, but I know that generally— You

Full Committee Ranking Member Jamie Raskin (D-MD)SPEAKER_10

seem to be an expert. So you don't favor federal student aid to kids who want to go to college, for Pell Grants or for college work-study. You're opposed to that?

Mr. Alex ShiehSPEAKER_13

I think that when students don't pay the cost of going to college, then we've seen prices rise.

Full Committee Ranking Member Jamie Raskin (D-MD)SPEAKER_10

made yourself clear, and thank you for coming in for your testimony. Look, a point was made before that collusion is per se illegal, which of course is true as a matter of antitrust law, but per se collusion is only illegal if there is actually per se collusion. Now, this reminds me of a hearing that we did over in the Oversight Committee with Chairman Comer about impeachment, where the Republicans lined up all these witnesses about impeachment of Joe Biden, and then all of them said that they didn't see evidence, they were not aware of evidence that would justify impeachment. And so the two expert witnesses here, Dr. Cooper and Mr. Martin, as I'm reading your testimony, are saying that they don't have evidence of price fixing. Mr. Martin says, I think you just stated it, I am making no judgment about any current conduct. You're not making a statement. And, Dr. Cooper, you said, My testimony does not take a position on whether Ivy Leagues are coordinating their pricing decisions or whether they're in violation of federal antitrust law. So again, this is much ado about nothing. This is an attempt just to create kind of a propaganda smokescreen to attack the Ivy League schools, and your expert witnesses are saying that they don't have evidence that there are antitrust violations going on. And of course, they're correct, because if there were, the Trump Department of Justice would actually be engaged in prosecution or an investigation of them. So we have one champion of the working class at Brown University who is opposed to Pell Grants and other means for kids to actually go to college in America, where most kids do go to college, and two expert witnesses who don't see price fixing taking place by the Ivy League institutions. But there is a real problem in America. Only 10% of college students go to for-profit colleges, but they're responsible for 50% of all student loan defaults. And I'm going to ask for unanimous consent to enter a campaign statement by Marco Rubio entitled, "Trump University Is an Absolute Scam: Get the Facts About Pending Litigation," if we could, Mr. Chairman. But Dr. Morgan, let me go to you. How does the Republican attack on regulatory protections against for-profit colleges and universities affect the fraud against students taking place in the education market generally? Because they are dismantling the regulations that were put in place to protect students against for-profit university fraud?

Ms. Julie Margetta MorganSPEAKER_00

Yeah, we're seeing action both here in Congress and at the Department of Education that are dismantling or laying the groundwork to dismantle all of the protections that have been put in place for for-profit schools. And what we've seen cyclically over time is when those rules are pulled back, we have increased enrollment in for-profit colleges, we have increased debt that people can't pay off, and we have increased allegations of fraud.

Full Committee Ranking Member Jamie Raskin (D-MD)SPEAKER_10

Okay, and what about their move to abolish the Department of Education and to gut the Consumer Financial Protection Bureau? Will that exacerbate the difficulties that young people are having paying for college?

Ms. Julie Margetta MorganSPEAKER_00

We're taking the cops off the beat who can actually identify that fraud and stop it and put money back into people's pockets.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

gentleman's time. Gentleman's time has expired. I ask unanimous consent to enter into the record the following: an article from Ivy Coach titled, "Ivy League Tuition and Fees for 2024-25," comparing tuition rates amongst the eight Ivy League schools, and also an article from Ivy Coach titled, "Ivy League Admission Statistics," comparing the acceptance rates amongst the eight Ivy League schools. I now recognize the gentleman from Virginia.

Rep. Ben Cline (R-VA)SPEAKER_08

Thank you, Mr. Chairman. I appreciate the hearing and I appreciate the comments of the ranking member. Let's define what collusion is. Let's actually look at Cornell Law School's definition, an Ivy League definition of collusion in antitrust law. Horizontal collusion exists where competitors at the same market level agree to fix or control the prices they will charge for their respective goods or services. For instance, two parties may collude by limiting or restricting supply, sharing insider information, or dividing the market. It's very clear that the eight Ivy League member institutions have a long history of colluding with each other and other elite higher education institutions. Back in 1958, they formed a cartel called the Ivy Overlap Group that created a common formula for calculating financial aid packages to ensure that a student admitted to one or more of the overlap group institutions would pay the same maximum price to attend, regardless of the institution that they chose. The overlap group would accomplish this by sharing information and determining the maximum price that admitted students' families could afford to pay. Later, operating under a now-expired antitrust exemption, many of the Ivy League institutions and other elite higher education institutions formed the 568 Presidents' Working Group, which likewise created a common formula to ensure 568 PWG schools would not compete on price. So, this behavior led to lawsuits and settlements against many of the Ivy League institutions. Dr. Cooper, does this cartel of elite higher education institutions have the ability to raise the cost for students and their families who are attempting to pay for college?

Dr. Preston CooperSPEAKER_14

Absolutely, Congressman. I believe the opaque financial aid system enables Ivy League colleges to charge much higher prices than they would be able to in a competitive market. There is a billion-dollar consulting industry that helps Ivy League institutions figure out exactly how much each family is able to pay and then charge that amount.

Rep. Ben Cline (R-VA)SPEAKER_08

We've seen collusion on pricing before enactment of the Section 568 exemption, and while the exemption was in effect, now we are concerned it persists today, even though the exemption has expired. What gaps in enforcement have allowed Ivy League institutions to effectively operate as a pricing cartel?

Dr. Preston CooperSPEAKER_14

So the, uh, the, the prices that colleges charge are very opaque right now. You have to apply and be admitted in order to figure out how much you're going to pay. And at that point, the college sort of has you captive, that you— it's going to be very difficult for you to comparison shop at that point, go to a different school, and you kind of have to accept the the price that the school is charging you, or else maybe not go to college.

Rep. Ben Cline (R-VA)SPEAKER_08

So, similar question to Mr. Martin. These institutions, through the Overlap Group and the 568 Presidents Working Group, used this common financial aid formula for decades to make sure they weren't competing on price. Do you think that these institutions could still be using that same revenue-maximizing formula to calculate financial aid awards that they used while the exemption was in place?

Mr. Scott MartinSPEAKER_04

Well, that's the subject of an ongoing litigation in the Northern District of Illinois. And to put a finer point, I make no prejudgment as to what the outcome of that litigation would be. I only note that 12 of the 17 member institutions have settled it for a total of $320 million. It survived a motion to dismiss. It's gone on through through discovery, and quite candidly, some of the documents in that case will be challenging for the remaining defendants.

Rep. Ben Cline (R-VA)SPEAKER_08

And if they are shown to be using the same formula, could that present significant antitrust issues?

Mr. Scott MartinSPEAKER_04

It, it could. There are substantial damages alleged in the case.

Rep. Ben Cline (R-VA)SPEAKER_08

Mr. Shieh, Brown's estimated cost of attendance during the '25-'26 academic year is $97,284 per year. That means Brown values a degree from its institution at almost $400,000. Do you think a degree from Brown is worth nearly $400,000?

Mr. Alex ShiehSPEAKER_13

That's a very good question. I think that is that empirically, it's it's just barely worth it. But I think that for the kids who it could help the most, that's that's too much for them to pay upfront.

Rep. Ben Cline (R-VA)SPEAKER_08

I appreciate that. I would argue that it does not— the worth is not, uh, 4 times the worth of an in-state school or 6 or 8 times that of a community college education. And with that, I would yield back.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Gentleman yields back.

Rep. Becca Balint (D-VT)SPEAKER_12

Mr. Chair, I have a UC

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

member recognized.

Rep. Becca Balint (D-VT)SPEAKER_12

I ask unanimous consent to enter into the record ABC News article, Judge Finalizes $25 Million Settlement for Victims of Donald Trump's Fraudulent University, and USA Today, Judge Finalizes $25 Million Settlement for Students of Sham University.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Without objection. Uh, gentleman from California is now recognized for 5 minutes.

Rep. Lou Correa (D-CA)SPEAKER_15

Thank you, Mr. Chairman. Appreciate you and the ranking member. Thank you for holding this hearing today. I'm sure here in Washington, D.C., discussing Brown, discussing Harvard, discussing private elite universities is very important somehow, somewhere, but not to my district. We're blue-collar middle class. My dad wasn't a doctor. He was a union worker making cardboard boxes, and my mom used to clean hotel rooms at $1.50 an hour, and we managed to survive. My neighbors, myself, we were all in the same boat. Never thought about Harvard because we weren't going to have the grades, we weren't going to have the money, and we had to survive, pay the rent, pay the bills on a day-to-day basis. Appreciate holding this hearing today, talking about these elite institutions, but I can assure you back home, nobody gives a darn about this stuff. What they care about is how to survive on a day-to-day basis. Public policy, government subsidization of public education: What's that old saying? If it ain't broke, don't fix it. The GI Bill, World War II over, the Greatest Generation comes back, comes back to the US. We decide to pay for their college education. We educated a generation, the Greatest Generation, that built the greatest country in the world on the government dime. My generation. I did go to the Harvard of the West Coast, Cal State Fullerton, second-rate school, not a UC, but a Cal State that was right for this kid from the hood. By the way, my tuition then was zero. Pell Grant, Cal Grant paid for everything, and I skipped a few meals to make it happen. Here we are today discussing Harvard, Brown, I'm gonna have to go back and tell my constituents that the two or three hours we spent here today is gonna make a big difference in their life. I will tell you what they're looking at: Cal Grants, Pell Grants, cutting of Pell Grants, school loans. They want to know how they can also get the opportunity to go to college. And by the way, subsidization of education? I thought we were all taxpayers. Do we not have the opportunity as taxpayers to say where our tax dollars are going to go? And don't those taxpayers go to our children, the greatest gift God gives us, our children, to educate them? So what's wrong with a subsidized loan that they will have to pay back? What is against public policy here? Again, if it ain't broke, don't fix it. Let's go a little bit further. Current administration, public policy, research grants, California, immigrants. Chart behind me shows all of the AI companies that have been recently started up by immigrants in this country. I thought we were supposed to win the AI competition. And I bring this up in the context of, if it ain't broke, why are we changing education public policy, investing in research and development, investing in making sure the best and the brightest from around the world come to help us come up with new inventions in this country, keep us ahead of the rest of the world? So again, what is it that's broke that we are trying to fix?

Full Committee Ranking Member Jamie Raskin (D-MD)SPEAKER_10

Would the gentleman yield for question?

Rep. Lou Correa (D-CA)SPEAKER_15

Go ahead,

Full Committee Ranking Member Jamie Raskin (D-MD)SPEAKER_10

Mr. Correa, thank you for your very passionate and eloquent remarks. What would have happened to you if you had not had access to Pell Grants and Cal Grants and public money to go to school? What would happen to your working-class constituents

Rep. Lou Correa (D-CA)SPEAKER_15

Are you asking me to delve into a personal confession? The gift that my father gave me when I graduated from high school was he said, Can't give you a watch. Can't give you something nice, but I can free you. You don't have to help us pay rent or pay the bills. You focus on studying. And that's where that financial aid came into being. This kid from the hood who wasn't quite ready for college was able to make it with that financial aid.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

The gentleman's time has expired. Now recognize Mr. Gooden from Texas for 5 minutes.

Rep. Lance Gooden (R-TX)SPEAKER_09

Thank you, Mr. Chairman. I think one of the points Mr. Shieh was trying to make was that these universities shouldn't be so expensive in the first place. None of us want to take away Pell Grants and loan support, etc., financial aid for anyone that needs it. Our point is it shouldn't cost this much in the first place, to the point that we need $400,000, whether it's subsidized or not, to pay for these degrees. I'm curious, Mr. Shieh, when you started asking all of these questions and making noise at Brown University, what was their response to you?

Mr. Alex ShiehSPEAKER_13

They were not very happy. The Brown administration told people not to respond to our emails, and then they hit us with a disciplinary investigation charging me personally for bizarre things such as emotional/psychological harm. Apparently, that's a real student code of conduct violation, but I was found not responsible for anything. But they also dragged in the entire board of the Brown Spectator and charged all of us, and luckily we were cleared. But I think this shows that that there's rot and they're trying to cover it up.

Rep. Lance Gooden (R-TX)SPEAKER_09

Isn't that interesting that they had a problem with your free speech and the, the work you were doing, but they didn't have a problem with the pro-Palestinian encampments and all the anti-Semitism? Isn't, isn't that just wildly ironic that they would go after little old you, just a student that's banging the drum and kicking and screaming about high costs. And that pissed them off so much that they started an investigation and came after you, but they didn't have a problem with the anti-Semitism all over their campus.

Mr. Alex ShiehSPEAKER_13

This is certainly a double standard. In 2023, we saw that a large group of protesters were actually arrested for trespassing. They invaded one of the buildings and they were asked to leave. They didn't leave. They were arrested, and Brown told the prosecutor to drop the charges. They weren't disciplined at all. I think there is a there's a clear double standard here.

Rep. Lance Gooden (R-TX)SPEAKER_09

Well, I hope you'll keep—I hope you'll keep after it. The fact that the Democrats on this committee are going after you, not hard, I'll give—I'll give them credit, but trying to nail you down on a Pell Grant question, it really doesn't have anything to do with the point we're trying to make here. The point is, if college wasn't so expensive, we wouldn't even need all this financial aid because it wouldn't cost a fortune to go to college. It shouldn't cost $400,000, and kids that can't afford it wouldn't need the aid that they get, because they would have aid, but we wouldn't need $400,000 of it. And so I hope that every child, every student in America can go to whatever college they want, but they're not going to as long as class sizes are limited and the price tags keep going up. Another, another interesting tidbit that I have found in all of this is all these endowments. One of my colleagues on the other side said taxpayer money was meant to go towards funding this. If an Ivy League institution has billions of dollars in their endowments,. then I'm wondering how much needs to be given to this university with extra taxpayer dollars. Dr. Cooper, will you comment on that?

Dr. Preston CooperSPEAKER_14

Absolutely. Some of these Ivy League universities have endowments in the tens of billions. Harvard has an endowment north of $50 billion, and these institutions actually are less likely to provide institutional financial aid than other private colleges with fewer resources.

Rep. Lance Gooden (R-TX)SPEAKER_09

And yet my colleague over here seems to just be outraged that we would want Harvard or Brown or name your university to use their endowment billions to educate the masses, rather than to use taxpayer dollars to further their cost escalations and their price increases. Am I missing something, Dr. Cooper?

Dr. Preston CooperSPEAKER_14

I think you're right. Harvard and other Ivy League institutions could certainly be doing a lot more with the tremendous resources they have available to make college more affordable for their students and to expand to more talented students.

Rep. Lance Gooden (R-TX)SPEAKER_09

Well, I just I praise your work. I am sorry on behalf of my colleagues on the left that seem to be so angry with your exposing of the corruption and the collusion and the exorbitant cost increases of Ivy League educations. I can't hear one peep out of them with respect to the antisemitism in these same Ivy League institutions. They're all mad at President Trump for actually standing up against this antisemitism that we're seeing. They're actually They're mad at President Trump for trying to bring down the cost and saying to these Ivy League institutions, we're not going to keep sending you money of U.S. taxpayer dollars as long as you're helping to propagate this antisemitism. They're doing nothing about this. And Democrats are so mad at the president for standing up for the students and for standing up for the taxpayers that they instead are wasting your time going after you. So, keep it up. Mr. Shieh, Dr. Cooper, Mr. Martin, I appreciate your work, and I encourage you to keep the pressure on Brown, especially Mr. Shieh. Don't be discouraged, and know that the American people, the vast majority of the American people, support your efforts. And we stand with you, and we share your views. Thank you.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Gentleman yields back. We have a couple of unanimous consent requests. Mr. Correa first.

Rep. Lou Correa (D-CA)SPEAKER_15

Thank you, Mr. Chairman. Unanimous consent for including the following items in our record. First one, Trump is Crushing America's AI Leadership. We Still Have Time to Fix It, April 23rd, 2025.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Not objection.

Rep. Lou Correa (D-CA)SPEAKER_15

JD Vance wanted aggressively attack American universities, June 3rd, 2025. Cost of Federally Sponsored Research infographic on the Association of American Universities website.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Without objection.

Rep. Lou Correa (D-CA)SPEAKER_15

2022, Benefiting Society and the Economy: American Technology Transfer for 2023: Federal R&D cuts would be another unforced policy error; number seven, America's R&D rethink threatens its innovation supremacy; number eight, New American Fortune 500 in 2024, American Immigration Council; number nine, U.S. scientists warn that Trump's cuts will set off brain drain; number 10, These are the U.S. universities more dependent on international students; and number 11, Losing international students could devastate many colleges. Thank you, Mr. Chair.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Without objection, I'll ask unanimous consent to enter the record the following: a Washington Post article titled Students Overpaid Elite Colleges. $685 million price-fixing suit. A press release from Berger Montague titled Plaintiffs in Elite University Price-Fixing Case Settle with Caltech and Johns Hopkins. And then also plaintiffs' memorandum of law in support of their motion for class certification in the case of Carzo versus Brown. The gentlewoman from

Full Committee Ranking Member Jamie Raskin (D-MD)SPEAKER_10

Mr. Chairman, I just have one more, if I could.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Oh, go ahead.

Full Committee Ranking Member Jamie Raskin (D-MD)SPEAKER_10

It's just for one article entitled "Congressional Republicans' Budget Reconciliation Bill Imperils 4.4 Million Pell Grant Recipients."

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Without objection. The gentlewoman from Vermont is now recognized.

Rep. Becca Balint (D-VT)SPEAKER_12

Thank you, Mr. Chair. We should be able to work together and find bipartisan solutions to this problem. I have two teenagers myself. They're starting to look at colleges. I've got sticker shock, as do most parents who go through this process. And I am really worried about all of the talented students who don't even apply, not just because of the tuition or the room and board, but simply the fees in order to apply. It's out of reach for so many families, and the astronomical costs mean working people do not have a fair shot at higher education. I think that that is why we have been so vocal today about the cuts to the Pell Grant program. Everyone seems to agree that the high cost of college is a real problem in this country, but we can't seem to agree on how it is that we're going to bring down tuition costs. This is the kind of things that Americans want us to be working on. To the point that my colleague was making here, they want us to come together and actually dig into the problem of how we solve this so that every student has an opportunity to go to college. But that's not actually why we're here today. It's so clear that that's not what this is actually about. Dr. Morgan, I'm so glad that you're here, and I thank you so much for your time. Can you take us through sort of the crux of what it is that we're supposed to be doing here, which is unpacking all of this? What are the things that are driving these higher costs in education?

Ms. Julie Margetta MorganSPEAKER_00

Yeah, thank you for the question. It differs really by sector. There are a lot of varied factors that go into college costs, but it really, it really differs by the type of institution and the type of business model. So when we take a look at a for-profit college, you know, they're out to maximize their profits. So the cost of providing the education is actually quite low and doesn't really drive the tuition prices. Their cost of marketing is quite high because they're trying to bring people in the door. You know, when we think about state institutions and community colleges that are educating the majority of students who go to college in this country, studies have shown that the thing that is really driving their costs, or the cost of tuition, is state appropriations. And so that's why I've been quite focused on what federal and state aid, and local aid as well, is going to these colleges and how what we do at the federal level impacts those state budgets, because I think we are going to see a squeeze on state budgets that increases the price of tuition. And what we've seen in the past is that it takes a really long time to unwind that, even if we're looking at something that, you know, that only affects a given year.

Rep. Becca Balint (D-VT)SPEAKER_12

So, what you're saying is is true, that if we are not investing in the institutions that most of our students go to, we are compounding the problem. I really appreciate that. When we're talking about the affordability problem, are we talking about all institutions of higher education in the United States, or is it just the Ivies?

Ms. Julie Margetta MorganSPEAKER_00

You know, I think there's, there's a broad swath of colleges where the tuition is quite high and where they're using these opaque discounting models to get to a net price. But there are a lot of colleges in this country that have held their costs quite low despite despite weathering the storms of state budgets and cuts to federal aid, and are really doing their best to provide an education at a transparent price to people where they can come out with as little debt as possible. I do think one thing to think about with that group of institutions and that group of students is how the costs in the rest of those students' lives have gone up.

Rep. Becca Balint (D-VT)SPEAKER_12

That's

Ms. Julie Margetta MorganSPEAKER_00

right. For community college students in particular, they're going to be affected by cuts to things like SNAP. They're also affected by the impact of things like the tariffs and the cost of living increases that that's driving for families. So for them, the whole package and their indebtedness to achieve an education is going to be higher because of all of the rising costs that we're seeing right now.

Rep. Becca Balint (D-VT)SPEAKER_12

I really appreciate that. It's a complicated problem. It requires a seriousness of purpose and not some sham hearing. My Republican colleagues are not here to seriously investigate the problem of college affordability. They are here to advance Donald Trump's culture war against people and institutions that he doesn't like, and to go after anyone who remotely disagrees with him. He wants to continue to silence the opposition. The reason I know this is because my Republican colleagues—every single one of them, across the aisle here—voted to eliminate or reduce student aid, increase monthly student loan payments, and drive students to take out predatory private loans. So, this hearing, once again, which we have seen over and over again in this committee, is to do the president's dirty work. We have real work that we should be doing to support our students, but we are preoccupied with going after the president's supposed political enemies. It's a shame, and it's a disservice to our students across this country. I yield back.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Gentlewoman yields back. Gentlewoman from Wyoming is recognized for 5 minutes.

Rep. Becca Balint (D-VT)SPEAKER_12

Thank you. I yield my 5 minutes to Mr. Nehls from Texas.

Rep. Troy Nehls (R-TX)SPEAKER_03

Thank you, Ms. Hageman. Thank you for our witnesses taking the time to be here. As we've already discussed, the tuition rates at self-proclaimed elite universities have ballooned over the years due to longstanding collusion between them, longstanding collusion. This has allowed these schools to accumulate the kind of severe administrative bloat rarely seen outside of our own federal government. As Dr. Cooper testified, Ivy League universities average one non-instructional staff per two students. How do you like that ratio? Yet the average private university gets by with one-third the administrative staff. And much like we see in the federal government, at some point bureaucracies, they get so big, fat, bloated that they serve no real purpose other than to justify their own existence. If these elite universities have one administrative employee for every two students, then what exactly are they employed to do? Well, one of our witnesses, Mr. Alex Shieh, decided to ask—great question, Alex—pursuant to his work as a student journalist investigating administrative bloat at Brown. Mr. Shieh emailed all 3,805 non-faculty employees of the university to inquire about what their job entail, right? Rather than simply respond to the inquiry, Brown chose to initiate disciplinary proceedings against Mr. Shieh. I was so appalled when I heard about this that I wrote a letter to Brown urging them to reverse course. I believe our fearless leader, Chairman Jordan, and the committee, they wrote a letter, and Brown reversed course, and I'm glad they did. It's one thing to create a vast, useless administrative bureaucracy to justify an exorbitant tuition rate of $93,000, but to punish a student journalist for daring to ask a question about it is unacceptable. Mr. Shieh, what first prompted you to make the inquiry?

Mr. Alex ShiehSPEAKER_13

That's an excellent question. So Brown has a $46 million budget shortfall, even while charging students the price of a luxury car, and it doesn't seem like they want to cut any administrators. They're having hiring freezes, but they're not willing to cut any jobs. So I thought this was something that needed to be looked into.

Rep. Troy Nehls (R-TX)SPEAKER_03

Why do you think the employees at your email, they didn't, they didn't answer your questions? Many of them didn't respond.

Mr. Alex ShiehSPEAKER_13

Well, some of them answered, and the ones who answered seemed to have pretty useful jobs. So I guess we can maybe infer that the ones who didn't have jobs that are not so important.

Rep. Troy Nehls (R-TX)SPEAKER_03

The ones that didn't were too embarrassed. They were too embarrassed. They weren't going to respond to you. Why do you think elite schools like Brown might be more frugal in administrative spending if they had to pay the same 21% tax rate on their endowment profits as corporations?

Mr. Alex ShiehSPEAKER_13

Certainly. I mean, when, when you have to pay higher taxes, there's, there's less money floating around and you got to tighten the budget.

Rep. Troy Nehls (R-TX)SPEAKER_03

Now, that's beautiful. We put it in reconciliation now. So these universities, it was 1.4%, now it's going to go to 21%. 21%. I'm so excited that that legislation was in our reconciliation. How about you, Dr. Cooper, what do you think?

Dr. Preston CooperSPEAKER_14

I think that the 21% tax on endowments will probably induce some belt tightening among these Ivy League institutions. And I would also note that the tax is structured such that if you expand your enrollment, you face a lower tax rate. And that might be an inducement that some of these colleges need to actually admit more qualified students from middle-income backgrounds.

Rep. Troy Nehls (R-TX)SPEAKER_03

Well, let me be clear. We're not actually taxing the endowment itself. It's the net profits, the earnings on their investments. And we're expecting $7 to $10 billion annually. $7 to $10 billion. It's a big deal. Mr. Cooper, the average four-year private university costs around $35,000 per student, while the Ivy Leagues average $126,000. To what degree is administrative bloat attributed to this?

Dr. Preston CooperSPEAKER_14

I can't imagine that most of that extra $126,000 in spending per student is really going to benefit students. What we see is much higher administrator-to-student ratios at Ivy League institutions than other private colleges.

Rep. Troy Nehls (R-TX)SPEAKER_03

Thank you. Thank you, Ms. Hageman. Mr. Chair, I yield back.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

The gentleman yields back, and the gentlewoman from Wyoming's time is yielded back. I now recognize the gentleman from Illinois for 5 minutes.

Rep. Chuy Garcia (D-IL)SPEAKER_11

Thank you, Mr. Chairman. This hearing highlights a real problem: the crisis of affordability in higher education. But instead of focusing on systemic issues and solutions, Republicans have chosen a narrow and misleading target, the Ivy League, which enrolls less than 1%, half of 1%, of all undergraduate students. It's been stated before: Rising costs are not unique to the Ivy League. Over the last two decades, tuition and fees at private and public universities have increased by over 100%. So this problem isn't limited to antitrust violations by the Ivy League. It's a problem that affects working families regardless of which school students attend. And this problem is rooted in the commodification of education. Many schools have become real estate trusts and hedge funds that treat education as an afterthought. They game the ranking system by jacking up tuition, offering discounts in the form of financial aid, knowing that they can exploit the student loan program and load their students with debt. This model has been a disaster for students and for our economy. Higher education is becoming more essential and more unaffordable. Over 40 million people hold nearly $2 trillion in debt, and Black and Latino students, immigrant students, and first-generation students in particular are being priced out of opportunity. So in addition to antitrust enforcement, Congress must act. And we should consider policy options like tuition-free public college, caps on tuition increases, increased need-based aid, reforms to the student loan system, and support for trade and vocational schools. Not everyone needs to go to college, but if Republicans were serious about affordability, we'd see policy solutions. We don't see that. Instead, we see culture wars. Let's talk about what they actually do. Ms. Morgan, thank you for being here. Let me ask you a simple yes-or-no question: Does gutting the Department of Education lower tuition costs?

Ms. Julie Margetta MorganSPEAKER_00

It does not.

Rep. Chuy Garcia (D-IL)SPEAKER_11

Thank you. Does cutting research funding for universities lower tuition costs?

Ms. Julie Margetta MorganSPEAKER_00

It does not.

Rep. Chuy Garcia (D-IL)SPEAKER_11

Does funding financial aid— does cutting financial aid programs and student debt relief lower tuition costs?

Ms. Julie Margetta MorganSPEAKER_00

Definitely does not.

Rep. Chuy Garcia (D-IL)SPEAKER_11

Does suppressing free speech and enforcing a Trump-approved ideology lower tuition costs?

Ms. Julie Margetta MorganSPEAKER_00

It does not.

Rep. Chuy Garcia (D-IL)SPEAKER_11

Thank you. And as usual, Republicans are pretending to be firefighters when they're actually arsonists. We need to address the cost of higher education, but nothing in their cruel reconciliation bill does that. So this hearing is just a hypocritical, hypocritical distraction. Republicans fight culture wars, they manufacture outrage and funnel taxpayer dollars to billionaires and to ICE, while defunding higher education programs that help working-class students, those that I represent in Congress, and other vital resources for our communities. Working families and our communities deserve better. Thank you, and I yield back.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

The gentleman yields back. The gentleman from North Carolina is now recognized for 5 minutes.

Rep. Mark Harris (R-NC)SPEAKER_16

Thank you, Mr. Chairman, and thank you to all of you that are on the panel today for your testimony. We've been in and out of other committee meetings, and, but I did have the privilege of reading your written testimonies in advance. And I do want to just ask you a couple of questions. For decades, elite universities were protected by the antitrust exemption under the understanding that they were going to provide these need-blind financial aid, which they arguably are not. And so, Mr. Martin, I want to go to you first. In your view, did the exemption do anything meaningful to bring down colleges' cost, to make or make colleges' expense more accessible?

Mr. Scott MartinSPEAKER_04

I've, I've not studied that, Congressman, but I'm aware of nothing.

Rep. Mark Harris (R-NC)SPEAKER_16

Okay. We really, I think, have seen what 30 years of colluding about the financial aid formulas did to college affordability and accessibility. But the exemption expired in 2022. So my question, again, Mr. Martin, would be to you: If we want students to be offered the best college experience at the lowest possible price, should Congress enact another antitrust exemption like Section 568, or force the schools to compete against one another?

Mr. Scott MartinSPEAKER_04

As, as an antitrust, uh, lawyer, Congressman, uh, the free market is generally, uh, the best, uh, the best tool for solving problems of prices.

Rep. Mark Harris (R-NC)SPEAKER_16

Well, and I, too, believe that competition would play a role in bringing down college costs. And we have data from the last 30 years that the antitrust exemption only succeeded in making our elite institutions more elite and further removed the needs of everyday Americans. So thank you. Thank you for your response. I want to go to Mr. Shieh. And Mr. Shieh, you caused quite a stir with your email to Brown's employees. Your efforts to shine a light on Brown University's excess mirrors our fight in Congress to cut wasteful spending as we're dealing with it day in and day out. Can you— I want to give you a chance to explain your motivation for shining a light on what you describe as administrative bloat.

Mr. Alex ShiehSPEAKER_13

Exactly. Well, I think the root of the problem is that Brown is just so darn unaffordable for students all across the country, and that's why Brown has the richest median income of all the Ivy League schools. Like I said, half of the Brown student body is from the top 5% of Americans, and I just think that's wrong. I think that's morally wrong, because the Ivy League is supposed to be a ladder to the American dream, but we're pulling up the ladder so that only rich kids can access it, and I think that's wrong.

Rep. Mark Harris (R-NC)SPEAKER_16

And I noticed in your written testimony that you pointed out there's roughly a ratio of one administrator for every two students, and I've got to ask you, is this necessary for Brown students to obtain a degree?

Mr. Alex ShiehSPEAKER_13

Certainly not. We can't We've seen that in the past. Brown didn't have this ratio, and it has functioned fine for hundreds of years. Across the pond, Oxford and Cambridge don't have that many administrators, and they function fine. Certainly, all these administrators are not necessary.

Rep. Mark Harris (R-NC)SPEAKER_16

And I would say, does this number of administrators meaningfully impact the overall experience of Brown students?

Mr. Alex ShiehSPEAKER_13

Certainly not, and they, they might even detract from it, 'cause when budget cuts need to be made, the enormous administrative bloat means that, and their unwillingness to reduce it, means that the costs have to be cut somewhere else,

Rep. Mark Harris (R-NC)SPEAKER_16

right? So, and which leads you almost to answer my other question, is how could cutting some of the bloat benefit the consumer that's looking to come to Brown?

Mr. Alex ShiehSPEAKER_13

Well, absolutely. Like, dorms flood, the, the food is unappetizingly bad, and the, the quality just keeps getting worse. Like, they're, they're reducing, uh, red meat from all the dining halls. They say it's about the environment, but it's really about the cost. Um, and, and by reducing administrative bloat, we definitely could see some improvements in the student experience.

Rep. Mark Harris (R-NC)SPEAKER_16

Thank you. Dr. Cooper, let me ask you, you said in your written testimony that, quote, "The surplus revenues that Ivy League institutions enjoy currently fuel administrative bloat, but they could be used to create more seats for qualified applicants." Can you explain the benefits for our entire nation that could come from increased enrollment at these elite institutions?

Dr. Preston CooperSPEAKER_14

Absolutely. Right now, if you look at elite institutions' graduates, they are vastly overrepresented in the elites of business, politics, and media. And if we were to expand Ivy League undergraduate colleges to more students, that would enable more students to get their foot in the door for this pipeline and enable a greater diversity of folks in those elite positions. So I would love to see Ivy League institutions use their endowments, use all the money they're currently spending on administration to expand and create opportunity for more of those students.

Rep. Mark Harris (R-NC)SPEAKER_16

Well, thank you. And thank you to all of you for shining the light that you're shining today. And, Mr. Chairman, with that, I yield back.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Gentleman yields back. Without objection, I ask unanimous consent to enter into the record the following: a press release from the Department of Justice titled "Consent Decree Settles Charge of Conspiracy to Restrain Price Competition on Financial Aid Against Major Universities"; and an article by Sajja Sarda titled "How to Crush the Ivy League Cartel"; and, finally, a document numbered 753-18 filed in the case of Henry v. Brown University on December 16th, 2024. We now recognize the gentleman from Georgia for 5 minutes.

Rep. Hank Johnson (D-GA)SPEAKER_17

Thank you, Mr. Chairman. Let's be clear, everybody, there is no 568 antitrust exemption, thanks to the Biden administration. And as far as Mr. Shieh's testimony is concerned, it's Brown did not discipline Mr. Shieh, contrary to his report. And also, Mr. Shieh's numbers in terms of administration staff for Brown University are incorrect. So, and I'm surprised that you would pull up the ladder for students who are going to regular universities and colleges, prevent them from getting financial aid. That's crazy. But at any rate, Donald Trump and his MAGA Republican supporters in Congress are attacking our elite institutions of higher learning because these institutions and others produce the critical thinkers who stand opposed to the global trend towards authoritarianism and dictatorship, which Donald Trump and MAGA represent. They say this hearing is about eight Ivy League institutions and the cost of higher education, but that is just a facade. This is really about Trump's war on facts, debate, and truth. This is Trump's attack on academia, which comes straight out of the authoritarian playbook. Universities are full of smart, young, engaged people, and the institutions are committed to freedom of inquiry and diversity of thought. Universities provide independent sources of information and accountability. Indeed, individuals with higher levels of education are less likely to be tricked by authoritarian appeals. So any autocrat or dictator who wants to exercise limitless, arbitrary power sees independent institutions of higher education as a threat. After all, Donald Trump can't replace our democracy with a dictatorial regime if the people are smart enough to recognize that he is a threat to freedom, liberty, and justice, which our democracy guarantees. Dr. Morgan, I believe that academia is inextricably tied to our democracy and to our liberty. Can you talk about why higher education is important for the protection of freedom and democracy?

Ms. Julie Margetta MorganSPEAKER_00

Absolutely. You know, first of all, our institutions of higher learning are places where people come together and learn and have to, you know, kind of be in the same place as people with different opinions. So it really promotes democratic values from the start. But to your point, universities can also be a place of free inquiry that can, can result in, um, you know, information that can oppose or point out flaws in larger societal trends or or political trends. So they can be really important voices in our societies. They're also places that produce research that can help us better understand what's happening in the world around us, including what's happening, the kind of effects of the negative changes that a presidential administration might be putting in place. So they're incredibly important to our democracy and to our society.

Rep. Hank Johnson (D-GA)SPEAKER_17

Thank you. As a lawyer, I've watched with horror as a number of law firms bent a knee and succumbed to Donald Trump's unlawful pressure campaign, but I'm proud of the brave firms that chose to stand up for the rule of law. Now, as Trump goes after the universities, I'm equally concerned. In March, Columbia University caved to Trump's demands when the administration threatened to yank away $400 million in federal funding. Yet, more recently, Harvard is showing backbone in rejecting Trump's demands. Dr. Morgan, why is it important that universities stand up against the administration's attacks? And conversely, what would happen if universities succumbed and started toeing the line for this administration?

Ms. Julie Margetta MorganSPEAKER_00

Yeah, I think it's incredibly important that universities follow the law, but not submit to demands that have nothing to do with their legal requirements. You can see in the attacks on Harvard and the kind of proposed solutions from the Trump administration that they're looking to really control the minutiae of the decisions at those colleges. That's not an appropriate role for the federal government to take. I think the other thing that's important to understand here is that other universities are going to take their cues from what these much better-resourced institutions are able to do in terms of standing up to the administration. So it's really important for those universities that have the resources to do so to take a stand.

Rep. Hank Johnson (D-GA)SPEAKER_17

So attacking elite institutions is a canary in the coal mine.

Ms. Julie Margetta MorganSPEAKER_00

That's right.

Rep. Hank Johnson (D-GA)SPEAKER_17

All institutions of higher learning are under attack.

Ms. Julie Margetta MorganSPEAKER_00

That's right.

Rep. Hank Johnson (D-GA)SPEAKER_17

Thank you. With that, I yield back.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Gentleman yields back. Now recognize the chairman of the full committee, Mr. Jordan, for 5 minutes.

Full Committee Chairman Jim Jordan (R-OH)SPEAKER_06

Thank you, Mr. Chairman. Mr. Shieh, what did you say tuition was again at Brown? Annual tuition?

Mr. Alex ShiehSPEAKER_13

Is $93,064 in direct costs.

Full Committee Chairman Jim Jordan (R-OH)SPEAKER_06

$93,000. That doesn't count room and board and books and everything. That's just tuition, right?

Mr. Alex ShiehSPEAKER_13

No, that's, that's including room

Full Committee Chairman Jim Jordan (R-OH)SPEAKER_06

everything. Okay. $93,000. How many students did you say again was at Brown? Over 7,000, I think you said.

Mr. Alex ShiehSPEAKER_13

7,000.

Full Committee Chairman Jim Jordan (R-OH)SPEAKER_06

Yes. That's a lot of money coming in. It could be some grants, it could be some aid, it could be some loans, whatever, but $93,000 times 7,000, it's like $700 million coming into Brown every year. And you ask the fundamental question, sort of simple question. You ask the question, where the heck's all the money going, right? And you said, maybe I'll check the administrators. How many administrators are having— And you said, I think the number you said was 38 or 3,805. Is that right?

Mr. Alex ShiehSPEAKER_13

Yep.

Full Committee Chairman Jim Jordan (R-OH)SPEAKER_06

And then you sent a letter to these guys asking another fundamental question. What do you do all day? What was the response? You said most of them didn't get back with you.

Mr. Alex ShiehSPEAKER_13

Most of them didn't respond. And we were hit with disciplinary charges.

Full Committee Chairman Jim Jordan (R-OH)SPEAKER_06

So the administrators couldn't respond to a simple question. You're taking in $700 million a year. What the heck are you 3,800 administrators doing every— the administrators didn't respond, but the administration came after you. Is that right?

Mr. Alex ShiehSPEAKER_13

That's right. When you investigate the administration, it turns out they investigate you back.

Full Committee Chairman Jim Jordan (R-OH)SPEAKER_06

Yeah. And, you know, it was interesting to me because the ranking member of the full committee and the ranking member of the subcommittee talked about academic freedom and the First Amendment. You were asking these questions on behalf of a student news publication, right?

Mr. Alex ShiehSPEAKER_13

Right.

Full Committee Chairman Jim Jordan (R-OH)SPEAKER_06

Was it Brown What's the name of your paper? Brown Spectator?

Mr. Alex ShiehSPEAKER_13

Yep.

Full Committee Chairman Jim Jordan (R-OH)SPEAKER_06

And they come after you. Why do you think they did that? Why did they come at— well, first of all, what'd they come after you about? What did you allegedly do wrong?

Mr. Alex ShiehSPEAKER_13

Well, first it was emotional and psychological harm, invasion of privacy, and misrepresentation. And then they decided to charge me with violating the technology

Full Committee Chairman Jim Jordan (R-OH)SPEAKER_06

policy. Asking someone how they spend your money is emotional harm. That's what they alleged,

Mr. Alex ShiehSPEAKER_13

apparently.

Full Committee Chairman Jim Jordan (R-OH)SPEAKER_06

Uh, and then what happened in the investigation?

Mr. Alex ShiehSPEAKER_13

Well, then they escalated and they charged the entire board of directors of The Brown Spectator for violating Brown's trademark because our publication is named The Brown Spectator, which is just a completely bogus claim. And

Full Committee Chairman Jim Jordan (R-OH)SPEAKER_06

Are there other newspapers at Brown would use Brown in the name of the paper?

Mr. Alex ShiehSPEAKER_13

Yes. Are other newspapers, The Brown Daily

Full Committee Chairman Jim Jordan (R-OH)SPEAKER_06

Probably in the entire history of the university, there's been some kind of Brown publication, right?

Mr. Alex ShiehSPEAKER_13

Certainly.

Full Committee Chairman Jim Jordan (R-OH)SPEAKER_06

Yeah. I mean, that's just ridiculous. Why do you really think they did it? Why did they really come after you?

Mr. Alex ShiehSPEAKER_13

I think that they were upset that we unveiled the rot that was going on. All these administrators with pretty useless jobs. And that's

Full Committee Chairman Jim Jordan (R-OH)SPEAKER_06

certainly one reason they were mad at you. But I think it's probably more— I think they were trying to make sure no one else would do it in the future. That's always the way it works. The left comes after people. They will— they want to chill speech so it doesn't happen again. Do you think that was part of their motivation?

Mr. Alex ShiehSPEAKER_13

I think that certainly was true, but it backfired terribly.

Full Committee Chairman Jim Jordan (R-OH)SPEAKER_06

Sure did. Sure did. Because you're brave enough to keep talking, keep and come here and testify. So God bless you for doing that. Now, you can have, I'll direct this to you, Mr. Martin, you can have a bloated bureaucracy when you're colluding on price and not and and making sure you're not competing on price with other similarly situated institutions. Is that right, Mr. Martin?

Mr. Scott MartinSPEAKER_04

Yes.

Full Committee Chairman Jim Jordan (R-OH)SPEAKER_06

And you're not supposed to do that, are you, according to the law? Is that right, Mr.

Mr. Scott MartinSPEAKER_04

collude on price, it's per se unlawful.

Full Committee Chairman Jim Jordan (R-OH)SPEAKER_06

It's per se unlawful. And you can also have bloated bureaucracy when you collude on price and you limit output, you limit class size. Is that right, Mr. Martin?

Mr. Scott MartinSPEAKER_04

That's correct.

Full Committee Chairman Jim Jordan (R-OH)SPEAKER_06

And do you think that's going on at these? Oh, there's a third one. You can also do all this if you engage in perfect price discrimination, where you get all this information on the student and their families, what they make, where it goes, what they owe, what their retirement is, all this information, you can say, That student can pay this amount. You'll take it right to the edge where they can pay and get perfect price discrimination. So when you do those 3 things, you can afford to have 38— 3,805 administrators for 7,000 students. Is that right, Mr. Martin?

Mr. Scott MartinSPEAKER_04

You make an excellent point. The more perfect the information, the more perfect the collusion can be, algorithmically or otherwise.

Full Committee Chairman Jim Jordan (R-OH)SPEAKER_06

course, and that's exactly what's going on. Is that right, Dr. Cooper?

Dr. Preston CooperSPEAKER_14

The evidence is certainly consistent with that. Yes.

Full Committee Chairman Jim Jordan (R-OH)SPEAKER_06

That's what the evidence shows. And yet the other side says, oh, how dare Mr. Fitzgerald have this hearing? You got to be kidding me. They tried to chill the speech of a news publication at the university for a student they're supposed to be serving, asking a simple and fundamental question. And they want to chill that because they don't want anyone to look under the covers and see that they're colluding on price, they're limiting output, and they're doing perfect price discrimination. Imagine that. Imagine that. And we're not supposed to have a hearing? Holy cow. I want to thank the chairman for doing the hearing. I want to thank all of you for testifying. And Mr. Shieh, thank you for stepping forward and letting the country know what's going on at these elite universities.

Full Committee Ranking Member Jamie Raskin (D-MD)SPEAKER_10

Will the gentleman yield for a quick question?

Full Committee Chairman Jim Jordan (R-OH)SPEAKER_06

I yield back to the chairman. I'll yield. Dude, you got—

Full Committee Ranking Member Jamie Raskin (D-MD)SPEAKER_10

Well, I just wonder if your feelings are the same about the attacks on a private student publication called the Harvard Law Review taking place by the Trump administration right now.

Full Committee Chairman Jim Jordan (R-OH)SPEAKER_06

Well, I think the chairman or the ranking member knows that you and I have been strong defenders of the press. We have cosponsored together the PRESS Act defending the press. I will continue to do that. But I'm I'm focused on the situation in front of us today, Mr. Shieh, at Brown University.

Full Committee Ranking Member Jamie Raskin (D-MD)SPEAKER_10

I'm with you. Hold the thought. And more power to the free press at Brown and at Harvard.

Full Committee Chairman Jim Jordan (R-OH)SPEAKER_06

God bless America.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Gentlemen, time has expired. That concludes today's hearing. We want to thank our witnesses.

Full Committee Chairman Jim Jordan (R-OH)SPEAKER_06

Oh, Mr.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Nadler has a UC request.

Ranking Member Jerrold Nadler (D-NY)SPEAKER_02

Thank you, Mr. Chairman. I ask unanimous consent to enter into the record an article entitled "Ivy League Schools Financial Aid" from the Ivy Coach Daily. And it says, "Moreover, while the sticker price at the Ivy League schools is high, about $90,000 per year, roughly half of the students receive financial aid with average awards covering two-thirds or more of the cost. The vast majority of students from Ivy League schools graduate with no loans. Half of the Ivy League schools offer a completely free education to families whose incomes are at $75,000 or less."

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Is that the title or the whole article? That's the whole article.

SPEAKER_UNKNOWN

Yeah.

Ranking Member Jerrold Nadler (D-NY)SPEAKER_02

And I have a second

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

objection.

Ranking Member Jerrold Nadler (D-NY)SPEAKER_02

A second unanimous consent request, shorter. I ask unanimous consent to enter into the record an article from Chicago Booth Review titled "Who's at Fault for Student Loan Defaults?" that argues that this article reviews research that analyzes student loan defaults and finds that for-profit colleges, half of the student loan defaults are from programs that only enroll 10% of U.S. students. Furthermore, the review argues that default rates are not being driven by tuition costs.

Chairman Scott Fitzgerald (R-WI)SPEAKER_05

Without objection, that concludes today's hearing. I want to thank the witnesses for appearing before the committee today. Without objection, all members will have 5 legislative days to submit additional written questions for the witnesses and additional materials for the record. Without objection, the hearing adjourned.