Democratic presidential hopeful Bernie Sanders is vowing “free” college tuition if he is elected and Hillary Clinton is promising a plan that might make student loans a thing of the past, but a prominent economist says the only results would be soaring costs for taxpayers and a much worse education for students.
Sanders and Clinton have made the cost of education one of their earliest campaign issues. While Sanders advocates government picking up the tab for tuition, Clinton’s plan is a bit more complicated. She would commit $350 billion over ten years to help make college more affordable for families. While requiring qualifying students to work ten hours a week while in college, she would also mandate that a college graduate would never pay more than ten percent of their income to pay down student debt. Recipients who faithfully make payments would have their remaining debt erased after 20 years.
Those details give the impression of a detailed plan, but those in the know see nothing but political spitballing.
“First, $350 billion doesn’t even come close to paying for kids’ college over the next ten years. What politicians do is they’ll throw out a big number and make it sound like they’re doing it, but it doesn’t come close. It is a huge expense,” said Brian Wesbury, former chief economist for the Joint Economic Committee in Congress. He’s now chief economist at First Trust Advisers in the private sector.
Not only does Wesbury believe Clinton greatly underestimates the cost of education, but he says plans like those offered by her and Sanders would only make the affordability problem exponentially worse.
“When you give something away for free, the demand for it picks up. When the demand for it picks up, the price picks up. We already know what student loans have done to the cost of college,” said Wesbury, who believes there is a clear parallel in another sector of the economy.
“There’s a saying about health care, ‘If you think health care is expensive now, just wait until it’s free.’ If you think a college education is expensive, just wait until it’s free because taxpayers would have to foot the bill and the costs would go through the roof while the quality of education fell,” he said.
Wesbury says schools are a marketplace just like anyplace else and the amount of government involvement at various levels tells a very instructive tale.
“For example, our higher education system in the United States is one of the best educational systems in the world. But if you look at our primary education, especially inner city schools, where school is free, it’s one of the worst education systems in the world,” said Wesbury.
“You have to have a market. You have to have a price mechanism. That’s the only way to keep the quality up,” he said.
However, Wesbury says there is a big difference between the government paying for everyone’s tuition and taxpayers helping the truly needy get ahead in life.
“I don’t have a problem economically with helping low income people get a college education. The problem comes when you make it universal, when you make it bigger over time. Then you take the competitiveness out of the school system,” said Wesbury.
So what is Wesbury’s answer to the high cost of education? First, he says we need to realize why the tab is so high.
“The whole idea is that you’re paying the professor to teach the student no matter what it is. In ballroom dancing, you have to pay the professor today, whether or not that helps a child get an education,” said Wesbury.
He believes the market post-graduation should determine the costs.
“My alternative would be to make college professors paid by equity. In other words, negotiate with the student. I get ten percent of your salary for the next twenty years, or fifteen percent of your salary for the next 18 years, some negotiation,” said Wesbury.
“If that were the case, what do you think the professor would teach the student? They would teach them that would earn them an income, that would get them a job: math, writing, speaking. You know, all the things that actually work, rather than what we’ve gotten to know as politically correct education,” he said.
Wesbury believes that by relying on the future salaries of students, professors will spend more time developing critical skills and less time indoctrinating.
“Let the professor share in the income the student can earn. Then the professor would be forced to teach something that is of value in the marketplace,” he said.
