I am not a specialist in the economics of education, and I don’t have the evidence to back up what I’m about to say—but I’m pretty sure I'm right.
The ongoing debate about student debt is simply insane. Of course, we can argue for decades over how much and what forms of public subsidies students should get for the immense financial expense of higher education, and in a narrow sense the nuances matter. But surely the big picture is missing here, isn't it?
Once upon a time, when I was young, there was a two-tiered system in the US, with expensive private colleges and universities for those who could afford them and nearly-free public education for everyone else. Then decisions were made. The US has a mostly decentralized structure in which the provision and financing of public higher education occurs at the state level, but somehow, miraculously, every state in the union simultaneously began a process of shifting costs from taxpayers to students and their families.
I would dearly like to know who made these decisions and how they were disseminated to all the state-level boards, commissions and legislatures. Here’s my uninformed speculation on why this happened:
1. Evidence accumulated that college graduates were earning a lot more than high school grads. It seemed unfair to make everyone pay for something that primarily benefited just a few. This was especially the case since college attendance is strongly correlated with class. To shift the cost of public higher ed to tuition seemed to be in line with “fairness”.
2. Private schools chafed at the subsidized competition. They have a lot of pull, since their graduates are everywhere, and they lobbied for higher public tuitions. This could be justified through arguments about the virtues of competition, a level playing-field, etc.
3. Greater labor mobility undermined the economic growth case for public subsidy. Any individual state could choose to make higher ed more expensive and then import qualified workers from other states. (My own state of Washington has the second lowest per-student expenditure for higher ed in the country but also a thriving high-tech sector, which draws in workers from everywhere else.) At the national level the US has been able to attract as many foreign-trained engineers, doctors and other specialists as it needs.
4. Connected to item 1, elite thinking began to frame education at all levels as a consumer good, and schools as businesses with customers. Once you begin to think this way, there are lots of reasons why consumers should be charged the marginal cost.
Of course, by withdrawing public support for higher education, tuition skyrocketed—a feature, not a bug. This in turn called for new public policies to facilitate lending to students so they could pay these costs, since, as you learn in introductory economics, a problem with human capital is that it can’t be collateralized. And the upshot of all this is an explosion of student debt, which brings us back to our starting point.
Meanwhile, higher education itself has been devastated by these developments. The US, which was once a world-leader in the proportion of its students who completed a BA, is now behind the global peloton. Students take on part-time jobs, not to mention multiple and full-time jobs, to finance their education even as they try to keep up with their studies. I often see heads bobbing, fighting off sleep, from students I know are putting in 20 or more hours per week at work. This in turn has led to a reduction in the amount of outside assignments, such as reading and papers, faculty can require without feeling like sadists. And now there is a powerful trend to restore the two-tiered system, but by cheapening the public product rather than elevating the private one. This is where “disruptive” online instruction is headed—depersonalized, rigid, “competency”-based learning for the many and the traditional classroom model, which can be rich, intensive and transformative, for the affluent few.
Note however that this is not a universal trend. It is furthest advanced in the US, with England and Australia beginning to catch up. Canada has not gone this route, and it has barely begun to have an impact in continental Europe. (Germany tried to introduce a modest tuition at its public universities and students rebelled; the government backed down.) The conversion of higher education to a consumer good is not inevitable.
So here’s what I'd like to know: who exactly made the decisions to eradicate free public higher education in the US? Why was there no debate? Why here and not everywhere else? Why is this question still off the table in the US even as “access” remains a key political issue? And what would it take for this country to make a second decision to reverse the first one?
