Bernie Sanders and His Plan

Bernie Sanders has really been picking up steam in the Democratic polls over the past month or so. It seems as though young people are actually very much invested in this presidential race, as you often see Bernie Sanders shirts on campus, or Donald Trump hats that read “Make America Great Again.” One of Sanders’ policies that has received the most attention over the course of his campaign is his stance on college tuition.

According to his campaign website,  “Last year, Germany eliminated tuition because they believed that charging students $1,300 per year was discouraging Germans from going to college. Next year, Chile will do the same. Finland, Norway, Sweden and many other countries around the world also offer free college to all of their citizens. If other countries can take this action, so can the United States of America.”

Sanders also notes that the University of California school system offered free tuition until the ’80s. He also plans to allow people with student debt to refinance loans at lower interest rates.

In order to pay for the costs that would be incurred by making public colleges tuition-free, the Sanders administration would impose a tax on “Wall Street speculation” that would account for the $75 billion of new government costs.

The website states, “If the taxpayers of this country could bailout Wall Street in 2008, we can make public colleges and universities tuition free and debt free throughout the country.”

At face value this sounds great. Attending a public school like Penn State would be tuition-free for all, likely allow many to obtain a college degree with relative ease while also avoiding crippling student debt. But as an economics major, if I have learned anything so far it is that there is always a tradeoff.

In a US News article titled Bernie’s Bad College Idea, author Kevin James brings up concerns with Sanders’ plan, like the potential side-effect that a highly-subsidized public education system would practically run private institutions out of business. With this reduction in possible options, public universities would feel less of responsibility to treat their students with sufficient care, driving down the quality of education.

There is even the argument that students who can afford full tuition should pay it, because there is really no reason not to.

James goes on to say, “…for a variety of reasons, institutions have much more incentive to meet enrollment targets and pass students through than to help ensure they are successful after graduation,” and that, “…institutions need more “skin in the game” in terms of the outcomes of their students.”

From an economic standpoint, James makes a very sound argument. Essentially, he wants the market to run its course by freeing up regulations that keep institutions of higher education from innovating.

My question, however, is what is to be done about college aged people who have absolutely no ability to pay for an education, and therefore are left out of the education system and left without the skills that would allow for success in our modern workforce?

Another interesting movement in the workforce is the difference that a graduate degree makes. An undergraduate with a business degree can expect to about $54,000 according to Seattlepi. A graduate of a business school (MBA) program can expect to make between $70,000 and $90,000 after graduation.

The reason that graduate school degrees are paying so much more is due to the greater percentage of people obtaining an undergraduate degree. This graduate degree (and many others) allow for a person to stand out.

A business degree is not cheap, though. According to the University of California – Los Angeles registrar, UCLA’s Anderson School of Management has an annual cost of $48,722.38 for in-state students and $55,009.39 for out-of-state students. The law school has a yearly cost, but is a three-year program instead of a two-year program.

One argument against Kevin James’ case that students who can afford a college education should pay for it is that it’s rare that a student could attend a university of any sort and then turn around and enter into a graduate program without incurring some tremendous amount of debt.

I understand the objections against Bernie Sanders’ policies that would allow for free tuition at public universities, but I also believe that there is a tremendous imbalance in the education system today. Something has to be done because, at the moment, those who want to go for a graduate degree in something that they are passionate about either have to be able to afford a whole lot of college costs, or be willing to take on huge sums of debt. Sanders’ plan may not be idea, but at least it’s something.