Can This Be Serious? : Justice Department picks silly fight with top schools

For nearly 125 years, the Massachusetts Institute of Technology has asked first whether an applying student was bright and then whether the family could pay the tuition.

Now Washington is charging that MIT violates the law when it decides how big a scholarship a bright student needs in order to enroll.

Washington’s Justice Department bases its case on the Sherman Antitrust Act, written in the 19th Century to block corporate price-fixing. At issue are meetings among MIT and eight Ivy League schools about outstanding students who have applied at more than one campus.

The schools compare notes on the financial needs of these “overlap” students. Registrars hope in that way to avoid bidding wars for students they all expect to be stars. Bidding wars, they say, just soak up scarce scholarship funds that otherwise could be stretched to cover others too poor to scrape together tuition.

The Justice Department argued that this was a kind of reverse price-fixing. The Ivy League schools signed consent decrees, agreeing to stop the meetings. But MIT refused, saying it did no wrong and that Washington decides who qualifies for federal grants much the same way. So the attorney general took MIT to court.

Universities are not what Congress had in mind when it passed the antitrust law to “bar outrageous profits.” Far from making robber-baron profits, MIT charges $15,600 a year for an education that costs $31,400, making up the rest from endowments and gifts. But that is the least of the lunacy of Washington’s lawsuit.

The Justice Department sat on its hands all during the frenzy of mergers in the 1980s while global competitors took American corporations to the cleaners as the companies were preoccupied with buyout threats. Now it seems to be making up for lost time by pouncing on academic institutions that managed during the merger frenzy to offer an education that even America’s stiffest competitors agree is the best in the world.

This may be no more than free-market fervor carried to extremes, but that makes it no less ridiculous.