A House of Representatives subcommittee alleged anticompetitive practices and rising tuition costs among Ivy League universities in a hearing on Wednesday.
The hearing — held by the House Judiciary Subcommittee on the Administrative State, Regulatory Reform, and Antitrust — comes after Republicans announced an investigation into the Ivy League’s eight universities, including Penn, for alleged violations of antitrust laws in April. Chairman Scott Fitzgerald (R-Wis.) claimed that Ivy League universities “collude to raise prices and spend their inflated cartel earnings on administrative bloat.”
In his opening statement, Fitzgerald stated that the price of attending an Ivy League institution — which has risen to over $90,000 in recent years — have continued to rise despite six out of eight Ivy League schools having “endowments exceeding $10 billion.”
“These schools have been focused on exclusivity, maximizing profits and artificially inflated prestige, rather than expanding access to education and serving students,” Fitzgerald said.
Ranking member Jerry Nadler (D-N.Y.) noted that the exclusivity of Ivy League universities is also a result of the federal government’s restriction of financial assistance for students.
“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,” he said. “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.”
The hearing also included remarks from witnesses Preston Cooper, a senior fellow at the American Enterprise Institute for Public Policy Research, Scott Martin, a partner at Philadelphia based law firm Hausfeld, Alex Shieh, a rising junior and student journalist at Brown University, and Julie Margetta Morgan, the president of The Century Foundation.
Morgan echoed Fitzgerald’s opening statement, referencing the crusade led by 1968 Wharton graduate and President Donald Trump against higher education — specifically Harvard University.
“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 what the law says and from our norms and democratic values,” Morgan said. “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.”
In 1989, the Department of Justice investigated the Ivy League and Massachusetts Institute of Technology over their shared formula for calculating financial aid, which ensured students admitted to multiple schools would pay the same price no matter where they went. The Justice Department filed an antitrust lawsuit against the schools, prompting various settlements and a congressional exemption from federal antitrust laws as long as the schools adopted a “need-blind” practice during the admissions process.
In 2022, students accused Penn, among other elite institutions, of forming a “price-fixing cartel” that colluded to decrease financial aid and benefit wealthy students. They argued that this collusion led to a decrease in financial aid for around 200,000 students over a 20-year period and overcharged them by $685 million.
Penn is among six universities that have yet to settle the antitrust lawsuit over financial aid, which could expose the defendants to approximately $2 billion in damages.
“Even with a legal exemption, these elite schools still chose profit and prestige over access and fairness,” Fitzgerald said.
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