Is New York’s HigherEd Plan Free?

Socialists among us are rejoicing at New York’s new plan to make 4-year college education “free”. First of all, let us clarify that this is not exactly the case. Of course, that is what one should expect of a socialized education program. After all, this is the government confiscating the wealth of some to give to others with the benefit of gaining the admiration, and votes of the others. So, the politicians who stand to benefit from this scheme, with Andrew Cuomo and Hillary Clinton at the front of the crowd, must do their best to oversell it and thus bolster their support among the recipients and those who prefer to have the government manage their philanthropy.

While the plan is fairly generous, it amounts to a subsidy of up to roughly $26,000 over the course of four years, and that only for contiguous attendance directly after high school. It doesn’t replace other federal or state grant money. It is intended to fill the gap between grants and total cost or subsidize those from families who earn too much income for other grants yet earn less than $100,000. It is unclear whether there will be any merit basis for eligibility.

Appropriate Intervention?

This all sounds great for the middle-class, college-bound, high school student. The problem is that it is accomplished by the state. In a constitutional republic, such as the United States, the state should only intervene this way if there is a problem where the public interest is clearly in jeopardy. Even Thomas Jefferson supported this, saying,

“… establishing free schools to teach reading, writing, and arithmetic, and from these schools those of intellectual ability, regardless of background or economic status, would receive a college education paid for by the state.”

Jefferson spoke of “establishing”, not necessarily operation of such schools. He also spoke of merit-based scholarship, not free education for all.

Any intervention should be temporary, aimed at solving the problem rather than creating a dependent electoral constituency, and managed such as to ensure that it is not exacerbating the problem or creating new problems as unforeseen consequences.

What’s the Problem?

In this case, the State of New York is “solving” a problem that doesn’t exist. As a result, they are probably creating a bunch of problems that would most likely be managed best by the economic decisions of individuals in freer markets of higher education.

The only real benefit is the boost politicians like Andrew Cuomo and Hillary Clinton get from their constituencies.

The United States is seventh in the the world when measuring bachelor-level education attainment of people under the age of 25. New York ranks well above average among the states of the United States. The problem this addresses is the waning interest in the Democratic Party. And it addresses it by purchasing votes with redistributed treasure.

What are the Consequences?

Providing “free” higher education in such an environment will most likely shift the supply and demand curves in a way that increases the cost of higher education and also creates a glut of graduates, diminishing their value to the economy and thereby their earning power. It also shifts the dynamics of already existing free-market philanthropic solutions by artificially skewing the economic environment.

Another risk of this sort of intervention is that the quality of education will be reduced to keep the cost down. This risk always exists, but raising the political stakes by creating a benefit given by generous politicians increases the factors that motivate degradation of quality as a short-term, soft-dollar adjustment.

The only real benefit is the boost politicians like Andrew Cuomo and Hillary Clinton get from their constituencies.

Socialism Leeches the Gains of Free Enterprise

I realize that my more socialistic friends have faith that the State of New York will rise to the challenge of becoming a virtuous benefactor by giving bureaucrats the power to redistribute wealth yet again. I respect their burgeoning hope but I point to history as a reminder that, in the long-term, Socialism has proven, unequivocally, to be less efficient and effective than free enterprise. Socialism works best following a period of prosperity created by free enterprise. It then removes incentives to innovate and excel, rewards the unproductive, and punishes the brightest among us. The result is general social malaise of both mind and heart.


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