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