Max Russell had always been a conscientious student, but when his father died during his junior year of high school, he had to take on a 25-hour-per-week job to help his family pay the bills. Last year, after finally qualifying for student loans and cobbling together some grant money, he transferred to Purdue University, one of the state's top public schools.

Over the years, many state-university systems and even states themselves have shifted more of their financial aid away from students who need it toward those whose resumes merit it. The share of state aid that's not based on need has nearly tripled in the last two decades, to 29 percent per full-time student in 2010-11. The stated rationale, of course, is that merit scholarships motivate high-school achievement and keep talented students in state. Merit metrics like SAT scores tend to closely correlate with family income; about 1 in 5 students from households with income over $250,000 receives merit aid from his or her school. "The US News rankings are based largely on the student inputs," said Donald Heller, dean of Michigan State University's College of Education.

This is obviously troubling for the students who need help, but it is also bad for the state economies that public colleges are supported by and are supposed to help advance.

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