free college vs. cost-benefit thinking
Last month, Howard Aldrich made—as he often does—a good point in the comments:
There’s been an interesting subtle shift in the rhetoric regarding whose responsibility it is to pay for an individual’s post-secondary education. My impression is that there was a strong consensus across the nation 50 years ago, and certainly into the late 1960s, that governments had a responsibility to educate their students that extended up through college. However, I perceive that consensus has been under attack from both the left and the right….Liberals argue that much of the public subsidy goes to the wealthier high income students whose parents don’t really deserve the subsidy. Conservatives argue that as students benefit substantially from their college education, they should pay most of the cost.
This month, I’ve been writing about the history of cost-benefit analysis. (Why yes, I do know how to have a good time.) On the surface, it has nothing to do with universities. But there are important links to be made.
One of the arguments I’m playing with is that economic thinking—here just meaning a rational, cost-benefit, systematic-weighing-of-alternative-choices sort of thinking—has been particularly constraining for the political left. On the right, when people’s values disagree with economic reasoning, they ignore the economics and forge ahead. On the left, while some will do the same, the “reasonable” position tends to be much more technocratic. Think Brookings versus Heritage. Over time, one thing that has pulled “the left” to the right has been the influence of a technocratic, cost-benefit strain of thought.
Yes, I know these are sweeping generalizations. But stay with me for a minute.
There are a couple of big economic arguments for asking individuals, not the public, to pay for higher education. Howard’s comment gets at both of them.
One is that while there is some public benefit in educating people, individuals capture most of the returns to higher education. If that is the case, it makes sense that they should pay for it, with the state perhaps making financing available for those who lack the means. Milton Friedman made this argument sixty years ago, and since then, it has become ever more popular.
The other is that providing free higher education is basically regressive. The wealthier you are, the more likely you are to attend college (check out this NYT interactive chart), and relatively few who are poor benefit. Milton Friedman made this argument, too, but it is particularly associated with a 1969 paper by Lee Hansen and Burton Weisbrod, and continues to be made by commentators across the political spectrum.
Both of these arguments have become economic common sense (even though support for the latter is actually pretty weak). Of course it’s fair for individuals to have to pay for the education that they benefit so much from. And of course it doesn’t make sense to pay for the education of the upper-middle class while the working poor who never make it to college get nothing.
Indeed, these arguments have been potent enough that it has become hard to argue for free higher education without sounding extreme and maybe economically illiterate. Really, it kind of amazes me that free college is even being talked about seriously these days by President Obama and Bernie Sanders.
But even the argument for free college now depends heavily on claims about economic payoff. The Obama proposal headlines “Return on Investment,” arguing that “every dollar invested in community college by federal, state and local governments means more than $25 [ed: !] in return.” The Sanders statement starts, “In a highly competitive global economy, we need the best-educated workforce in the world.” The candidate who is a self-described socialist relies on a utilitarian, economic argument to justify free higher education.
So what’s the problem with thinking about college in terms of economic costs and benefits? After all, it’s an expensive enterprise, and getting more so. Surely it doesn’t make sense to just wantonly spend without giving any thought to what you’re getting in return.
The problem is, if the argument you really want to make is that college is a government responsibility—that is, a right—starting with cost-benefit framing leads you down a slippery slope. Benefits are harder to measure than costs, and some benefits can’t be measured at all. All sorts of public spending becomes much harder to justify.
Now, this might be fine if you generally think that small government is good, or that the economic benefits of college are pretty much the ones that matter. But if you think it’s worth promoting college because it might help people become better citizens, or increases their quality of life in some difficult-to-measure way, or you just want to live in a society that provides broad access to education, well, too bad. You’ve already written that out of the equation.
If you really believe there are social benefits to making public higher education freely available, then cost-benefit arguments will always betray you. But rights, on the other hand, aren’t subject to cost-benefit tests. Only a moral argument that defends higher education as a right—as something to value because it improves the social fabric in literally immeasurable ways—can really work to defend real public higher education.
Seem too unrealistic? Think about high school. There’s no real reason that free college should be subject to a cost-benefit test when free high school is not. Individuals reap economic benefits—lots of them—from attending high school, too. And high school is at least as regressive as college: the well-off kids who attend the good public schools reap many more benefits than the low-income kids who attend the crummy ones. It only makes sense, then, that families should pay for high school themselves, right? Perhaps with government loans, if you’re too poor to afford it.
And yet no one is making this argument. Because we all still agree—at least for now—that children have the right to a free primary and secondary education. We may argue about how much to spend on it, or how to make it better, but the basic premise—governments have a responsibility to educate students, in Howard’s words—still holds.
So I support the free college movement. But I’d like to see its champions stop saying it’s because we need to be globally competitive, or because it’s got a huge ROI.
Instead, say it’s because our society will be stronger when more of us are better educated. Say that knowing higher education is an option, and an option you don’t have to mortgage your future for, will improve our quality of life. Say that colleges themselves will be better when they return to seeing students as students, and not as revenue streams.
Say it’s because it’s the right thing to do.