Higher education is facing a financial crisis causing many institutions to cut back their budgets. These cutbacks can be attributed principally to improper pricing policies: higher education is "sold" at a great deal less than its cost of production. The two arguments for low-cost or free tuition -(1) the principle of equality of opportunity, and (2) the benefit that accrues to society -are demonstrable weak. Low-tuition benefits primarily the middle-class student, and society benefits most from the lower grade-levels of education. Low tuition has some serious consequences: (1) it causes a rationing problem; (2) it disregards student motivation; (3) it raises dangers to the autonomy of the academy; (4) it threatens the existence of several private institutions; and (5) it results in a series of inequities for youth not continuing their education. The National Association of Manufacturers strongly advocates an increase in the forms, amounts, and availability of individual grants and loans to needy students and supports deferred tuition programs and other ideas aimed at reforming higher education. (AF)