Free Universal Education is Not Free

When I was in college I remember thinking that it’s too bad that college is not free for anyone to attend. At the time, I didn’t understand just what I was saying. I was only looking at one side of the equation. I felt bad for those who did not have the financial resources to gain further education. Now, as a management professor, it’s easy to see the error in my thinking. In Economics in One Lesson, Henry Hazlitt explained that,

The art of economics consists of looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups. (emphasis added)[i]

Cap

I’d engaged in this one-sided error of only looking at the effect on one group. I only focused on the effect that free education would have on potential students. I hadn’t considered the effect on others. What if college were free? Without revenue from tuition, how long could it stay in business without paying employees? I am a professor. I have six kids and they like to eat. I would not work for free. Who would teach?

At this point, you might argue that universal college education could be paid for with tax dollars. Then I could be paid, my kids could eat, and students could attend for “free.” That sounds nice in theory, but as Milton Friedman observed, “there is no such thing as a free lunch.” By that, he meant that everything that is free for someone, college in this case, comes at a cost to someone else.

The Sanders campaign proposed free universal college education in 2016. They estimated the cost to be $75 billion annually.[ii] This item became a feature  of the 2016 Democratic Party Platform:

Making Debt-Free College a Reality Democrats believe that in America, if you want a higher education, you should always be able to get one: money should never stand in the way. Cost should not be a barrier to getting a degree or credential, and debt should not hold you back after you graduate. Bold new investments by the federal government, coupled with states reinvesting in higher education and colleges holding the line on costs, will ensure that Americans of all backgrounds will be prepared for the jobs and economy of the future. Democrats are unified in their strong belief that every student should be able to go to college debt-free, and working families should not have to pay any tuition to go to public colleges and universities (p. 30).

As a professor, I can assure you that anyone who has a high enough GPA and ACT score can get a free ride to college. If you know someone who you think qualifies, I will be happy to connect you with the admissions department at CSU. The reality in education is that the average students subsidize the really smart students with their tuition dollars. This means that average and weak students pay more for their education.

The decision to pay for everyone’s college education with significantly increased taxation is a political choice. But, if taxes are used to pay for “free” education, that same amount of money cannot be used for other things (perhaps things that you value more). If we think “free” is without cost, we run into another one-sided error. As I write, our national debt is approaching $20 trillion dollars and the debt must eventually be paid.

By the way, “free” college education is not new. When Governor Kaine was in office, I was a member of my local school board. I remember his P-16 plan at the school board convention. What is P-16? You are familiar with K-12 (kindergarten-12th grade). He wanted to expand this from pre-school to completion of college at taxpayer expense. It never happened because the Commonwealth of Virginia simply did not have the money.

Now the Democrats are proposing the same one-sided error writ large. Perhaps instead of asking why we are not funding college education (as if we have no heart), we might ask:

  • What we cannot do with the $75,000,000,000 they intend to spend annually.
  • At what point should a person take responsibility for his own education?
  • What new regulations will come attached to the “free” federal tuition?

Stop asking one-sided questions and trace the consequences of your actions for all groups involved.

-Darin Gerdes

[i] Hazlitt, H. (1946/1979). Economics in One Lesson. New York: Arlington House Publishers. (p. 17).

[ii] It’s Time to Make College Tuition free and Debt Free. (2016). BernieSanders.com Retrieved from https://berniesanders.com/issues/its-time-to-make-college-tuition-free-and-debt-free/

______________

gerdes

Dr. Darin Gerdes is an Associate Professor and Director of Graduate Programs in the School of Business at Charleston Southern University. All ideas expressed on www.daringerdes.com are his own.

Leave a Comment

Filed under Economics, Poltics