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Commentary & Opinion

Blair Horner: Higher Education Takes Center Stage In The Presidential Campaign

Campaigns matter.  When candidates commit to a policy objective, there is a good chance, although no guarantee, that it will be taken up.

At the Presidential campaign, one important issue has emerged on the Democratic side: the policy response to the growing debt burden resulting from skyrocketing college costs.  According to recent estimates, college graduates now carry a debt burden well over $1 trillion, making it the second highest level of household debt after home mortgages.

These debts are the direct result of government policies to shift the burden of a public college education from society to the families of college students.  New York State has not been immune to this trend, over the past 20 years there has been a dramatic shift in the burden of paying for a college education.  In recent years, that trend has accelerated due to the policy of annual increases in public college tuition.  In 2008, before the annual tuition hikes went into effect, students covered 50 percent of SUNY’s budget; they now cover over 60 percent – thanks to the tuition hikes and the stagnant state support.

On the Democratic side of the Presidential debate there have been proposals to stem that shift.  Last week, Hillary Clinton, the presumptive nominee, advanced a plan to have the government pick up the tab for a public college education.  While the Republican presumptive nominee, Donald Trump, has yet to advance a plan, it was reported that he will do so later this month.

Under Mrs. Clinton’s education proposal, the federal government would provide tuition grants to states that agree to put up some matching money.  The Clinton plan would begin by covering students from families earning $85,000 a year or less. The yearly income cap would rise by $10,000 a year, reaching the $125,000 ceiling in 2021, when it would cover about 80 percent of American families with college-age children.

A big chunk of the cost of the program would be borne by individual states, which would be required to match federal effort, if those states wanted to offer tuition-free public colleges.

The Clinton plan would be paid for by limiting tax deductions for high-income taxpayers and by closing tax loopholes, particularly those used by hedge funds and private equity firms. A similar plan offered by US Senator Sanders had said his plan to make college tuition free would have cost $70 billion a year, with one-third of that paid for by states.

The requirement that states must offer a funding match, much like the health insurance plan for the poor (Medicaid), is one weakness of the Clinton plan.  As recently seen in the health insurance expansion resulting from the Affordable Care Act, some states may choose to opt out.  If they did so under the Clinton higher education plan, it is not clear what would happen. 

In addition to possible opposition from states that would not want to pay or that resent federal intrusion, the plan might face resistance from private colleges and universities that compete with public institutions receiving the federal money, even though it pledges $25 billion over 10 years to help historically black colleges and other private colleges with modest endowments.

While it’s hard to imagine New York State opting out of the Clinton plan if it were to become law, the opposition by private colleges and the ideological opposition of some states could ultimately sink the proposal.

Unlike the expansion of health insurance, which offered more health benefits to the poor, the Clinton plan would be very appealing to states.  Even the opposition would have to concede that the vast majority of Americans of college age – not just the poor – would benefit.  And the future economic health of the nation, and the individual states, hinges on the skills of its youngest adults.  A free public college education would draw younger families like a magnet.

Of course, the plan does hinge on Congressional support.  But the debate has begun over who should bear the cost of the educational investment in younger adults – society or the individual? 

It is a debate well worth having.

Blair Horner is the Legislative Director of the New York Public Interest Research Group.

The views expressed by commentators are solely those of the authors. They do not necessarily reflect the views of this station or its management.

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