Colleges Don’t Want ‘Free College’

By guest author Richard Vedder
September 17, 2019

Several internet sites, especially The College Fix, have noticed something: most colleges are conspicuously silent about either the Warren or Sanders proposals for free college. This may seem odd, as most institutions of higher education and their national spokespersons (e.g, Terry Hartle of the American Council of Education) are not known to be shrinking violets. Why the reticence about commenting on something so fundamentally important to higher education?

There are several potential reasons. First, these are simply proposals of candidates for president, persons who may not be nominated, much less elected. Colleges should stay out of public policy brouhahas, so silence is the appropriate response. Saying something good, or bad, about, say, Bernie Sanders’s proposal might imply institutional support or opposition to his nomination, and universities should be neutral marketplaces of ideas, not proponents of positions, particularly since institutions of higher learning in reality are a melange of students, faculty, staff, alumni and friends of wildly varying political persuasions. I find it offensive when some university president signs, for example, a document supporting efforts to combat climate change in which he proclaims an institutional position.

However, there is a more fundamental and crass reason colleges are silent: free college is potentially a nightmare for schools. Most universities earn a large portion of their revenue from tuition fees, and “free college” implies ending those fees. Implicit in the Sanders/Warren proposal is replacing tuition revenues with increased governmental subsidies. But the size and changes of those subsidies are highly uncertain and subject to political whims. Public opinion has turned less favorable to universities in recent years, manifested in tepid increases in state appropriations and, for some wealthy private schools, in the form of actually taxing them (the new federal tax on large endowments).

If tuition were free at public schools, how could the federal government justify large student loan programs benefiting only students attending historically expensive private schools? The free college proposals are potentially the death knell of federal student loans which, in turn, are the primary reason for the tuition explosion of the last generation and the large amount of student loan debt. Thus the Sanders/Warren proposals are a threat to maintaining the gravy train that has led to the highly inefficient and overstaffed modern university.

But the dilemma here is profound. Colleges are dominated by progressives—especially the faculty and the more vocal students. They by and large love politicians of the Sanders (whose wife is a former college president)/Warren (a former Harvard professor) variety. They contribute money to their campaigns and offer them policy advice. If either of those candidates is elected, they will be heavily represented in their administration. They certainly don’t want to appear to have negative feelings towards them, as that could help their political opponents (e.g., Donald Trump). Yet if free college ideas were adopted, especially Sanders’ free tuition for all proposal, they would face financial uncertainty and increased governmental dependence, meaning a loss of much of the institutional autonomy they still possess.

What to do? My guess is that individuals will support the Democratic Party nominee heavily in the 2020 campaign but largely remain silent on collegiate funding issues. After the election, if the Democrat wins, college presidents and lobbyists will endorse greater higher education funding of a traditional nature—large increases in Pell Grants, more liberalized student loan terms—but scuttle efforts for truly “free college.”

Economists like me have a so-so record of economic forecasting, much less election prognostication, but I put the probability of anything even closely resembling the Warren or Sanders proposal being adopted in 2021 at less than 10%. That further incentivizes colleges to keep quiet now about college funding proposals. I put the probability of divided government (no one political party controlling both houses of Congress and the presidency) in 2021 at 60% at the least. For all the rhetoric about college financing, the likelihood of big changes in funding higher education in the next three years is pretty low. A business downturn in those three years—a greater possibility—could further dampen the likelihood of free tuition (unless sold as a stimulus program, a highly dubious proposition).

Republished from Originally published in Forbes.