Free college. Free tuition. Student loan forgiveness. All of these ideas are being pushed by Democratic presidential candidates, but is what looks like a compassionate effort to help college students escape years or decades of crippling debt really just perpetuating a vicious government cycle?
Many candidates are advocating for free tuition at public universities and community colleges. Recently, Massachusetts Sen. Elizabeth Warren put forward a plan to forgive student loan debt as an even greater appeal to young voters.
But some experts see some big problems with that.
“First of all, I want my reparations for the tuition that I paid for my kids,” said Gary Wolfram, a professor of economics and public policy at Hillsdale College in Michigan. “If you’re going to forgive everybody else’s debt, then you’ve got to forgive mine too, right?”
Wolfram says the basic economics of debt forgiveness show the idea to be absurd.
“Why would anyone give someone a loan now. If you were a business firm, why would you loan somebody money for higher education because they’re never going to pay it back. It makes no sense at all. It can’t possibly work,” said Wolfram.
But Wolfram is not just picking apart the proposals of Warren and other Democrats. He says there is a problem with the cost of higher education, but government is the cause of this vicious cycle rather than the solution to it.
“It was the government going out and lending lots of money to people without looking to see if they’re going to be able to pay it off,” said Wolfram, noting Uncle Sam does far less due diligence before handing out money than a bank will do before approving a mortgage application.
“The reason you’ve got skyrocketing tuitions, and therefore more and more loans being taken out, it’s because there’s this cycle of the government providing loans to get people to go to college. Then more people are going to college, and it’s driving up the price of college, which [results in] more loans,” explained Wolfram.
Advocates of greater federal intervention in higher education say “free” tuition will take the soaring costs out of the equation. Wolfram says it will be just the opposite. He says sending virtually every high school graduate to college on the taxpayers’ dime will lead to the government intruding even more.
“Why wouldn’t you charge $200,000 a year for tuition because the government’s paying for it? Then the government’s going to say, ‘Oh my gosh. This is incredibly expensive.’ Then they’ll say tuition’s got to be $10,000 a year.
“That won’t be enough to fund all the increase in teachers, etc, that you’re going to need to have all these kids come in. Then the government’s also going to say, ‘Gee, when we’re doing that, we’re going to tell you what has to be in higher education. Here are the classes that you have to offer.
“So you’re going to end up with the Obamacare of higher education,” said Wolfram.
Listen to the full podcast to hear Wolfram explain how the universal push for four-year colleges is leaving massive labor shortages in skilled trades and steering students away from good careers that might fit them far better than another four years in school. He also reveals his approach to making college more affordable – and it looks a lot like the recruiting of college athletes.