Sunday, July 14, 2019

Some Thoughts on Making College "Free"

Are you weary yet of the noise in the political world about the debt crisis weighing down college students and the various proposals to make college tuition-free for students and/or to forgive some or all student debt?  It’s still too early to know how these ideas will play in Peoria, as they say.  Will anyone other than those saddled with big college loan balances go for the idea?  High school seniors, parents of college students, college professors…we might be surprised at the support these ideas generate in certain demographics.  But please indulge me a few personal thoughts on the subject.
Did you ever hear that there’s no such thing as a free lunch?  Of course somebody has to foot the bill for all this.  One and a half trillion dollars in debt does not just evaporate.  Taxes will go up.  Everybody’s.
Is it politically incorrect to say that not everyone is college material?  I’m sorry, but there are some people with aptitude for things not taught in most universities—manual skills that are still very much in demand.  Plumbers, for example, still make a very good living, generally speaking, and we definitely still need them around.  It is not fair to them or to the people asked (told) to pay their tuition to encourage them to go to college.
“Free” encourages freeloaders.  I seem to recall a country song about a guy who went to college, “majored in girls”, and only dropped out when the money dried up.  But what if the money never dries up?  Congress tends to see taxpayers as a bottomless bag of riches which they have a right to tap for any cause.  Can a freeloader go to college free forever?
Free tuition has been tried, and the results should not be shocking.  The Wall Street Journal recently ran a story about Kalamazoo, Michigan, and its scheme to rescue itself from a downward spiral of decay and declining population by offering local students free tuition.  The program began in 2005 and is funded by anonymous donors.  What are they seeing for their investment?  For those locals graduating high school between 2006 and 2012:
  • College enrollment within six months of graduation climbed to 75%, up from the city’s previous 58% rate and better than the national average of 67%.  However…
  • Only 38% earned a college degree, up just slightly from the 34% average in the three years prior.
  • Only 23% of black students earned a college degree, nearly equal to the previous rate of 22%.
  • Because the program is equally available to all students regardless of race, gender, or economic status, high-income individuals got more aid on average (more than twice as much) than the average low-income student, and Caucasian students nearly twice as much as non-Caucasian students.
Now that last point is especially critical.  In terms of pure dollars, all the kids had the same opportunity.  But so many other factors determine success in college—things like family support, single-parent homes, homelessness, teen pregnancy, and yes, intellectual ability.  A student with one or more of these factors working against him will be more likely to drop out, thus costing the anonymous donors a lot less money.  But the student with a strong support system will likely complete degree requirements and be subsidized for a much larger amount of money.  It’s an unintended but still very real consequence.
The same dynamic works with the loan forgiveness schemes that are being proposed by some presidential candidates.  They will mostly benefit those who have completed their degree and are more likely to be able to afford to pay their loans compared to those who dropped out and are, on average, earning less.  There have been some proposals to make the debt forgiveness contingent on being under a certain income level; but that ignores other factors bearing on ability to pay.  A candidate could propose to just forgive the loans of those who left college early, but “Loan forgiveness for dropouts” doesn’t have the ring of a winning campaign slogan.
I’m only addressing some of the economic factors here.  There’s also the moral hazard argument over free tuition and loan forgiveness.  And every parent knows his child appreciates the thing that she labored to achieve/buy more than what was handed to her.  What makes us think it will be any different for the college crowd, who is mostly still children, regardless of what they think of themselves?

Until next time,


“Why should fools have money for an education when they refuse to learn?” Proverbs 17:16 CEV