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Posts Tagged ‘Higher Education’

There’s a lot of speculation that we’re in the midst of a political realignment, with Democrats becoming the party of the rich and the Republicans becoming the party of the working class.

I don’t pretend to know whether this realignment is happening or what form it will take, but there is plenty of evidence that Democrats are focusing on policies that disproportionately benefit those with high incomes.

And those policies often are at the expense of ordinary people, which is an especially repugnant form of redistribution.

Their efforts to restore the state-and-local tax deduction are an obvious example, but they also favor other tax breaks that are utilized overwhelmingly by rich people.

They also favor big subsidies for higher education, which mostly benefit kids from well-to-do families (and well-paid college bureaucrats).

And now they want to provide another windfall for the college crowd.

Jonah Goldberg opines on this perverse form of redistribution in a column for the New York Post.

…a coalition of 236 progressive groups led by teachers unions called on Biden to cancel student debt on his first days in office. Biden himself has already urged Congress to cancel $10,000 as part of a pandemic relief package. Sens. Bernie Sanders and Elizabeth Warren have called for even greater debt forgiveness. Sanders’ plan would cost an estimated $1.6 trillion dollars. …Most Americans, especially most poor Americans, don’t have student debt, because most didn’t go to college in the first place. Moreover, most people who did go to college have no or very little student debt. …only 6 percent of borrowers owe more than $100,000. Virtually all of them borrowed so much because they attended graduate school. …do they deserve help more than truck drivers, mechanics or short-order cooks? One reason teachers unions — a huge source of donations and political organizing for the Democratic Party — want loan forgiveness is that teachers and administrators can boost their pay by going back to school to get advanced degrees. Other municipal and federal workers — another major constituency for Democrats — have similar rules. Using the pandemic as an excuse to reward workers who are far less likely to lose their jobs and more likely to find new employment if they do, seems awfully self-serving.

Writing last year for the Washington Examiner, Brad Polumbo argues for the principle of individual responsibility.

College is way too expensive, but nonetheless, most young people who are buried in student loans or struggling to pay off their debt only have themselves to blame. The average student is now graduating with $30,000 in debt…the median monthly payment is just $222. If you can’t afford that, as a college graduate, it’s probably your own fault. …If you chose to major in gender studies, French, or anything similarly impractical, it’s your own fault that you’re stuck with a lower starting salary and might struggle to make payments. That’s unfortunate, but it’s no justification for shirking your responsibility to pay back what you owe or asking taxpayers to bear the burden of your mistakes. …people who find themselves buried in hundreds of thousands in student loan debt have their own decisions to blame. …They chose expensive dream schools… To bail them out at taxpayer expense is to punish people who made responsible decisions and encourage recklessness from future generations. …to the millions of borrowers who’ve made terrible decisions, don’t ask for a bailout — it’s your own damn fault.

Some of you may be thinking that Polumbo’s argument made sense last year, but we’re now struggling with coronavirus-caused economic turmoil and perhaps debt forgiveness would help the economy.

But that’s not the case according to the number crunchers at the Committee for a Responsible Federal Budget. They show that loan forgiveness isn’t “stimulus” even if one uses discredited Keynesian analysis.

…loan forgiveness…is the not the equivalent of sending $1.5 trillion of cash to households. …because borrowers often pay back their loans over 10, 15, or even 30 years, debt cancellation will increase their available cash by only a fraction of the total loan forgiveness. …Not only would loan cancellation provide relatively little spendable cash to households, but the cash it does offer would be poorly targeted from a stimulus perspective. …The majority of those most affected by the current economic crisis likely have little or no student debt. Over 70 percent of current unemployed workers do not have a bachelor’s degree, including 43 percent who did not attend college at all. …Indeed, about two-fifths of all student debt is held by households with graduate degrees. 

So if loan forgiveness isn’t the answer, are there any desirable policies?

Mike Riggs, writing for Reason, explains we need less government rather than more government.

…subsidies have…driven up the cost of education at a rate multiple times higher than inflation. …The most libertarian policy preference in my view is two-pronged: get the federal government out of the lending and guaranteeing game, and make student loan debt reasonably dischargeable in bankruptcy. These two policies would realign the incentives of colleges, lenders, and students to bring down prices and saddle fewer potential students with loans they are unlikely to repay.

Amen.

I don’t like loan forgiveness, but I do sympathize with many indebted students because when Uncle Sam started dispensing grants and loans, colleges and universities responded with dramatic tuition increases and then used the money to create fat, waste, and inefficiency.

Let’s end this column with some satire.

First, the geniuses at Babylon Bee produced this gem, which could be based on Jonah Goldberg’s column.

One local plumbing contractor, Sam Caughorn, is really looking forward to paying the tab on his neighbor’s $89,000 gender studies degree. …According to studies, there are millions of white girls working at coffee shops across the country while struggling under the crushing student debt they acquired by irresponsibly obtaining college degrees that gave them no marketable job skills. Benevolent politicians have proposed transferring all the wealth from trade workers and minority business owners to help indebted white girls with their student loans so they can still afford their daily latte and cat food expenses. Local gender studies major Amber White is looking forward to having all her debt forgiven, thanks in part to the contributions of plumbers like Sam Caughorn. …According to sources, Sam Caughorn owns a successful business he started right after high school. He also has 5 kids, a nice house, and serves as a deacon at his church. “I guess I can spare some change for poor disadvantaged girls like Amber,” he said. 

Second, here’s a cartoon that could be based on the column I cited from Brad Polumbo.

P.S. The way federal intervention has screwed up higher education is very similar to the way federal intervention has also made the health sector expensive and inefficient.

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I received my Ph.D. from George Mason University in Fairfax, VA, and I have very fond memories of that experience, including interactions with great economists such as James Buchanan and Walter Williams.

But not everyone has favorable views of GMU’s market-friendly program. There’s a group, UnKoch My Campus, that pretends to be horrified that the school has attracted contributions from philanthropists such as Charles Koch and David Koch.

In a column for the Washington Post, Steven Pearlstein opines about the ostensible controversy.

Thanks to a group of courageous and persistent students, George Mason University was recently forced to acknowledge that it had accepted millions of dollars from billionaire Charles Koch and other conservatives under arrangements that gave the donors input into several appointments at the university’s famously libertarian economics department. These arrangements violated traditional norms meant to insulate academic institutions from donor influence… The story fits neatly into the liberal narrative that the Koch brothers, Charles and David, have used their inherited oil wealth to fund the development of radical economic theories at Koch-funded universities.

At the risk of digressing before I even get started, I have to correct Pearlstein’s snide comment about “inherited oil wealth.”

The Koch brothers did inherit a valuable company, but they are not dilettantes with trust funds. They took a successful company and built it into an extremely successful firm. I wouldn’t be surprised if more than 90 percent of any contributions they make are a result of value they created.

Also, Charles Koch is a libertarian rather than a conservative.

Anyhow, back to our regularly scheduled program.

Pearlstein may have taken a cheap shot at the Kochs, but at least he doesn’t blindly parrot the leftist narrative.

…at Mason, the story is more complicated… I’ve been a professor at Mason. …I’m not a member of the economics department — they wouldn’t have me. But over the years, I’ve gotten to know and admire many of the economists there. For the most part, I have found them to be good economists and teachers, incredibly smart, intellectually honest and curious. …In the case of Mason’s economics department, the faculty have driven the donor relationships. In most instances, it was the faculty who approached and solicited Koch and other donors with specific projects in mind, not the other way around. …Our economics department is not libertarian and conservative because it is funded by Koch and his friends; they fund our economics department because its faculty is — and always has been — overwhelmingly conservative and libertarian. …rules and norms of university governance give faculty the power to hire people who think like they do. …Sorting by political or academic ideology is a naturally occurring phenomenon at universities.

Pearlstein suggests that university administrators should insist on more intellectual diversity.

The challenge is figuring out what to do about it. …It would have been better if Mason’s presidents and provosts had insisted on more ideological diversity in the law school and the economics department.

Perhaps there’s merit to that idea.

But if that’s Pearlstein’s goal, he should first focus on other departments at other schools. Because there’s an overwhelming bias in the other direction when looking at America’s system of higher education.

Here’s a report from Inside Higher Ed about some academic research by Mitchell Langbert, Anthony Quain, and Daniel Klein.

A new study…, published online by Econ Journal Watch, considered voter registration data for faculty members at 40 leading U.S. institutions in economics, history, communications, law and psychology. Of 7,243 professors total, about half are registered. Some 3,623 are Democrats while just 314 are Republicans. Economists are the most mixed group, with a ratio of 4.5 Democrats for every Republican. Historians as a group are the most lopsided, at 33.5 to one… There are also regional effects, with ratios highest in New England. …Women are much more likely to be registered Democrats, at 24.8 to one. Among men, the ratio is nine to one. …Brown University has the highest ratio for all five disciplines combined, at 60 to one, Democrat to Republican. It’s followed by Boston University (40 to one), Johns Hopkins University and the University of Rochester (both 35 to one), and Northeastern University (33 to one). The lowest ratio — that is, the most even mix of registered Democrats and Republicans — is at Pepperdine University, at 1.2 registered Democrats for every Republican. Case Western Reserve University is next, at 3.1 to one.

Here’s a chart from the report showing that economics is the most balanced discipline, but even in that field Democrats outnumber Republicans by a 4.5:1 margin.

Professor Langbert has some new research on this topic.

And, as pointed out in this report, the problem isn’t getting better.

An extensive study of 8,688 tenure-track professors at 51 of the 66 top-ranked liberal arts colleges in the U.S. published by the National Association of Scholars found that the ratio of faculty members registered as Democrats compared to those registered Republican is now a stunning 10.4 to 1. If two military colleges that are technically described as “liberal arts colleges” are removed from the calculations, the ratio is 12.7 to 1. …nearly 40% of the colleges in the study had zero faculty members who were registered Republican. Not a single one. Nearly 80% of the 51 colleges had so few Republican faculty members that they were statistically insignificant. …this trend toward an increasingly uniformly left-leaning faculty has spanned decades, both in the United States and Britain. “More than a decade ago, Stanley Rothman and colleagues provided evidence that while 39 percent of the professoriate on average described itself as Left in 1984, 72 percent did so in 1999,” Langbert writes. “They find a national average D:R ratio of 4.5:1.

Wow. University professors may be even further to the left than journalists.

Let’s circle back to the controversy at George Mason University.

The Wall Street Journal recently editorialized on the faux controversy.

Progressives dominate all but a few corners of American academia, but apparently they want it all. Witness the political and media assault on George Mason University, an island of intellectual diversity in Northern Virginia… an outfit called UnKoch My Campus…claims that donors like Charles and David Koch inappropriately influence university decisions. The demand is for “transparency” but the real goal is to silence conservative views. …Among the horrors supposedly uncovered by UnKoch is that one condition of these gifts was that George Mason rename its law school after Antonin Scalia. …The truth is that the naming request and decision went through normal university channels that included a vote by the university’s Board of Visitors, as well as the State Council on Higher Education for Virginia. …Donors are committing no crime in trying to judge if their philanthropy is fulfilling its purpose. The Kochs, God bless them, believe in supporting academics who believe in the principles of liberty and market economics. …Researchers from Stanford, Harvard and the University of Chicago Law School found last year that only 15% of American law school professors are conservative. We’re surprised it’s that many.

My two cents is that universities – either faculty and/or administrators – should be free to hire whoever they want under whatever rules they want. And students (or their parents) should be able to say no to schools that go overboard.

But here’s the catch. I don’t want to pay for any of it, either directly or via my kids. Let’s get rid of federal handouts for higher education.

The good news is that the no-subsidy approach also would reduce tuition costs since there no longer would be a third-party-payer problem.

Sounds like a win-win scenario.

P.S. My dissertation topic at GMU was Australia’s private retirement system, which was a clever decision on my part. Nobody in the United States at the time knew anything about the Aussie approach, which meant it was a) comparatively easy to make a contribution to the literature, and b) the professors on my committee didn’t know enough about the topic to nit-pick. Best of all worlds.

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