Bloomberg reports on a number of private universities not quite able to make a case for inclusion among the 100 claimants to the country's top 20 changing their financial aid policies in the hopes of raising their profiles.
To increase their standing on college rankings, more private colleges are giving “merit aid” to top students, who are often affluent, while charging unaffordable prices to the needy, according to the report. The percentage of students receiving merit aid jumped to 44 percent in 2007-2008 from 24 percent in 1995-1996, the report found. To a lesser extent, public universities are using some of the same practices, [New America Foundation researcher Stephen] Burd said.

Many of the most selective and wealthiest colleges, including the eight members of the Ivy League, Williams College in Williamstown, Massachusetts, and Cambridge-based Massachusetts Institute of Technology, award aid based only on financial need. Less selective nonprofit colleges often offer tuition reductions and merit aid to lure students to fill their seats.
In a perverse way, these institutions are recognizing that there is excess demand for a degree from an institution perceived to be excellent, a point we have long emphasized here.
Colleges use merit aid for talented middle- and upper-income students because it is less costly than pursuing similar prospects from poor families, said Catharine Hill, Vassar’s president. Enrolling low-income students costs schools money because they are giving up a spot for those who can pay full freight -- or close to it.

“Unfortunately this kind of choice further contributes to the income inequality that has increased significantly in the United States over the last three or four decades,” Hill said in an e-mail. “Our nation’s commitment to equal opportunity and social mobility is at risk.”
The commitment, if in fact there is such a thing as a national commitment, is at risk for a number of reasons, not the least of which is the continued failure of the common schools in low-income neighborhoods.  A related Bloomberg column by Michael Petrilli gets it.
A huge proportion of this $40 billion annual federal investment is flowing to people who simply aren’t prepared to do college-level work. And this is perverting higher education’s mission, suppressing completion rates and warping the country’s K-12 system.

About two-thirds of low-income community-college students -- and one-third of poor students at four-year colleges -- need remedial (aka “developmental”) education, according to Complete College America, a nonprofit group. But it’s not working: Less than 10 percent of students who start in remedial education graduate from community college within three years, and just 35 percent of remedial students earn a four-year degree within six years.
The policy is not working, and the responsibility for the policy not working rests with the supply chain.
To be considered successful, the high schools serving these young people would need to get their college-bound students to a college-ready level, not just get them to graduation. They might offer more college-prep courses, especially for those pupils with the most promise, and make sure the teachers are up to the task.

Likewise, state officials concerned about college completion would be prodded to ensure that their high schools produce college-ready graduates, maybe boosting graduation standards accordingly. Better yet, they might start to include college matriculation and graduation rates in their high-school accountability systems.

As for colleges, without a federal funding stream for remedial education, many would decide to become more selective, only admitting students who are ready for credit-bearing courses.

This would probably raise the academic tenor of the institution, for students and professors alike. And with fewer students using Pell aid, we could afford to make each grant more generous, removing financial barriers that force well-prepared low-income students to leave before graduation, or not to come at all.

In sum, disqualifying the use of Pell grants for remedial education would substantially reduce the gap between the number of students entering higher education and the number completing degrees.
'Tis a consummation devoutly to be wished.

Where the article falls short is in praying for pre-college job training, or on-the-job training for entry level workers. That is not an alternative to toughness at the college admissions office cascading to toughness at the high school and before.  It is a by-product.  It's likely the case that today's disengaged high school junior is a risk to himself and everybody else on the shop floor, in the warehouse, or at the deep-fryer.

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