Free college tuition for everyone?

A few of you have written in to ask what I think of the Clinton plan (NYT link) to dramatically reduce tuition for a four-year college education.  The focal point of the plan is this:

Under the plan, which was outlined by Clinton advisers on Sunday, about $175 billion in grants would go to states that guarantee that students would not have to take out loans to cover tuition at four-year public colleges and universities. In return for the money, states would have to end budget cuts to increase spending over time on higher education, while also working to slow the growth of tuition, though the plan does not require states to cap it.

By the way, here is a more extreme Bernie Sanders plan, closer to free tuition period, though in both cases a variety of details remain murky.

One issue is to debate the social value and externalities associated with a college education, but that would lead us far afield.  Let’s assume that such externalities are present.

A more pressing issue is that community college is already close to de facto free for lower-income individuals, if they piece grants and aid together.  Yet the completion rate at these colleges is at best approaching thirty-eight percent.  The real problems come before college, and encouraging more people to attend four-year colleges is unlikely to do much good.  In any case, here is further evidence that higher subsidies to community college attendance very often do not lead to more actual education.  The same or worse is likely to hold for state universities.

It could be the goal is not “college for more people” but simply to redistribute income to students who otherwise would have debt burdens.  But they, with their above average human capital, are not the most deserving recipients of additional redistribution.  Might a cynic wonder if this is simply a way to reward a constituency which often votes Democratic?  Or a way to make the Republican Congress look like meanies?

The end result of the plan would be price controls on tuition, even though the plan itself does not stipulate that.  There simply isn’t the political constituency to support an extra federal $350 billion for higher education (over ten years), plus the state kick-ins which are supposed to follow.  The federal money will sooner or later dwindle, while the tuition restrictions will stick.  In the longer run, this isn’t even a net subsidy to higher education.  In the short run higher ed quality will go down, and in the longer run the move away from tuition support will imply more fiscal starvation for these institutions rather than less.

In sum, let’s not do this.

Addendum: Here is information on the Scottish experience with free tuition.


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