Wait…Government Subsidies Have Increased College Tuition?
We knew that. You knew that. Apparently even Vice President Joe Biden knew that. Yet still, he and President Obama believe more government subsidies are the answer!
During a visit to Florida State University (this blogger’s Alma Mater) on Monday, the Vice President was asked how he felt about government subsidies interfering in the free market and how that artificially increased tuition costs. Vice President Biden responded (emphasis added):
“By the way, government subsidies have impacted upon rising tuition costs. It’s a conundrum here. But if we went the rate your view of the free market route what we would have done is we would have not of done that. We would not have increased Pell grants, for example. And there would be 9 million fewer students in college today.
“And there would be hundreds of thousands and millions of students who would not be in college who don’t get Pell grants because there was no ability for them to borrow money through Perkins loans and/or have the tax deduction.
“So you are right, in a pure free-market the college tuition would have to be lower because there would be fewer people going to school, they wouldn’t have as much coming in. But the end result is we would probably have — we go for the better part, half a generation, of going 16th in the world maybe down to 20th in the world.”
What Mr. Biden doesn’t realize is that lower tuition costs would allow more students to attend college. It would be easier for them to get loans – the taxpayer-backed grants wouldn’t be necessary. And what’s more, because of the lower tuition cost, students would be more able to pay back their loans after they graduated.
Even if there are more students going to college than would have otherwise, those students have difficulty paying back their loans because they cost too much and the students can’t get a job in this economy to pay them back anyway.
The free market would have erased all that government distortion. Lower tuition costs, more competition, better education and better ability to pay back the loans. Compare that to what we have with government subsidies: high tuition costs which keep some students from being able to afford college, lower degree of education because there is less incentive for colleges to compete for the best quality education and the lack of ability to pay back loans.
How does Vice President Biden believe that ramping up the status quo will somehow fix everything?