HESA

Higher Education Strategy Associates

Category Archives: Politics

Elections, political parties and platforms, other political issues and processes

June 08

That Andrew Scheer Free Speech Promise

That Andrew Scheer Free Speech Promise

You may recall that a few weeks ago I profiled the higher education/science/youth proposals of the various Conservative Party leadership hopefuls.  You may also recall that the candidate who eventually won the context, Andrew Scheer, had one proposal that distinguished him from the rest of the pack, to wit:

In addition, Scheer pledges that “public universities or colleges that do not foster a culture of free speech and inquiry on campus” will “not have support from the federal government”.  He then lists the tri-councils and CRCs as specific funding mechanisms for which institutions would not be eligible: it is unclear if the ban would include CFI and – more importantly – CSLP.  Note that the ban would only cover public institutions; private (i.e. religious) institutions would be able to limit free inquiry – as indeed faith-based institutions do for obvious reasons – and still be eligible for council funding.

Scheer elaborated on this just once in the media, so far as I can tell, telling the National Post on April 19th  of troubling trends on campus “a pro-life group having its event cancelled at Wilfrid Laurier University; a student newspaper at McGill refusing to print pro-Israel articles; and protest surrounding University of Toronto professor Jordan Peterson for his views on gender pronouns.”

A lot of people are scratching their heads about this.  What the heck is that all about? they wondered.  Does he actually mean it?  And how would that work, exactly, anyway?

Let’s take those questions separately.

What the heck is this about?  It is hard to see any pressing cases of people who were simply not allowed to speak led to this statement.  The stuff at Wilfrid Laurier was perhaps childish but no one was prevented from speaking.  The McGill Daily is perhaps wrong in its editorial policy, but freedom of the press also means the freedom not to publish things.  And students at U of T are presumably as free to criticize Jordan Peterson as Peterson himself is free to be an obnoxious jerk.

There certainly have been cases where speakers have been shouted out or prevented from speaking on campus because of protests but not recently (I can think of two off the top of my head: Benjamin Netanyahu at Concordia in 2002 and Anne Coulter at the University of Ottawa in 2010.)  If we broaden the complaint to other things like taking down “free speech walls” because of perceived derogatory comments, or preventing abortion rights groups from displaying pictures of aborted fetuses at tabled in busy hallways because it’s gross and upsetting, you can probably come up with stuff that is slightly more recent.   But I suspect he’s really reacting to south-of-the-border stuff that happens to make the news up here, in particular the events at Middlebury College, a tony liberal arts school in Vermont where controversial social scientist Charles Murray was fairly violently and crudely prevented from speaking back in January.

(If you want a really exhaustive compendium of perceived slights to free speech in Canadian universities, the Justice Centre for Constitutional Freedoms provides one annually in its Campus Freedom Index, the 2016 edition of which is available here).

So if there’s no urgent policy problem here, what’s it about?  My guess is that roughly akin to Stephen Harper’s anti-census position.   It’s a way of throwing meat to the party’s populist faction without actually adopting a fully populist platform.

Does he actually mean it?  Hard to tell, but my guess is that he does, at least to the extent that he wants to be able to have a platform to talk about unaccountable lefty cultural institutions.  It’s not a loosely-worded pledge: specific exemptions have been carved out for faith-based institutions (part of Scheer’s base), which I think suggests this isn’t something he came up with on the back of a cocktail napkin. Plus, in his victory speech, he went out of his way to repeat the pledge, which he was in no way obliged to do.  And he got a huge cheer from the crowd for doing so.  Antithetical to higher education sensibilities it may be, but it plays with the base.

(And yes, it has been pointed out a few times that among the people who might be most put out about this would be the pro-Israel types who try to stop the “BDS/End Israeli Apartheid” rhetoric on campuses, and who were a particular target of Tory woo-ing during the Harper years.  I think the safe assumption is that Scheer knows and doesn’t care).

How would that work, exactly, anyway?  This of course is the big question, and the one that has most people scratching their heads.  Presumably there would be some kind of complaint process: but to whom would the complaint be addressed?  What kind of body in Ottawa would have the ability to a) judge whether or not an institution was or was not promoting a culture of free speech and b) the power to order a remedy in the form of full or partial removal of funding from federal granting councils?  Does Scheer really think an administrative body could do this?  How would institutions not litigate both of these decisions into outer space?

Also, how does Scheer imagine that provincial governments – you know, the ones which actually have the constitutional responsibility to run and regulate postsecondary education – will react to any intrusion into their jurisdiction?  Can you imagine, for instance, how the Andrew Potter fiasco at McGill would have escalated if Andrew Scheer had taken Potter’s side?  The province, which genuinely lost its mind on the subject for about a couple of days (one major newspaper ran a piece comparing Potter to Rwandan genocidaires), would have gone berserk if Ottawa had tried to meddle.

These complications, in the end, are probably going to be used to create a graceful way to get out of the specifics of the pledge.  No government is going to put the University of Toronto’s hundreds of millions of tri-council funding at risk over a spat about personal pronouns, or yank nine figures worth of funding from McGill because it doesn’t like the Daily’s editorial policy on Israeli settlers in occupied Palestine.  But it might really want to keep those issues in the public eye for partisan purposes.

So, in the event of a Conservative victory, expect an office to be created that would report on “violations” of campus free speech, no doubt staffed by former authors of the Campus Freedom Index.  Money won’t be placed at risk, but institutions would be put on notice.  And Conservative partisans would be delighted.  Which is the real point of the policy.

One can deplore this attitude, of course.  But the point is that Scheer believes that beating this drum will increase his chances of winning power.  He’s probably not completely wrong to think that.  Wiser heads will spend time in the coming months pondering why bashing universities is popular to begin with.

May 29

Halifax, We Have a Problem

 

Passing through Halifax airport on Thursday, I realised that I have been remiss in not yet having covered the party platforms for tomorrow’s provincial election.   So, I set about reading the party platforms and then immediately wished I hadn’t because they’re basically a tidy encapsulation of most of what’s wrong with higher education policy in Canada.

Let’s start with the ruling Liberals.  Now, they haven’t done badly by PSE in government, especially in their last budget, which saw the sector get a 4% boost in real terms.  The only thing you can fault them for – and it’s a reasonably big fault – is that when they cut the $50 million Graduate Tax Rebate, they chose not to reinvest any of it either in students or in post-secondary more generally.

The Liberal platform promises no new money for institutions.  It does however, have an incredible grab-bag of micro-promises, all of which cost in the $1-4 million range, which is pretty small even for Nova Scotia (apparently they have learned the lesson that media coverage is proportional to the number of announcements, not the dollar value of those announcements).  They want to add an “Innovation Sandbox” to the seven that already exist, create a new provincial research agency, increase subsidies to hire master’s and doctoral graduates (as well as aboriginal, minority and disabled Nova Scotians) top up MITACS funding, eliminate tuition for apprentices when they leave work to complete technical training, expand opportunities for women and minorities in apprenticeships, increasing provincial student loans to $200/week and expanding loan forgiveness eligibility by changing the eligibility criteria from four years to graduation to five years.  Total annual cost of all that, when fully phased-in: about $13.5 million, with about three-quarters of that going to students one way or another.

Running neck and neck with the Liberals are the Progressive Conservatives, who have a much more limited set of pledges around post-secondary education.  Just three, in fact.  First, “force universities to focus on innovation and job creation” (are they not doing this already? What more are they supposed to do?); Second, roll tuition back to the Canadian average (about $900 per student); and third, reinstate the Graduate Tax Rebate that the Liberals axed.  The costing on these is tragic/hilarious.  Apparently neither of the first two promises will cost a cent – universities will have to eat the $30 million or so cost of the tuition pledge and whatever the hell it costs to meet this fantasy pledge about innovation and job creation.  And the graduate tax rebate?  $25 million – or only about half as generous as the program it’s meant to replace.  So, then, that’s a $55 million in net benefit to students, a real cut of $30 million plus to institutions.

Finally, we have the NDP platform.  The Dexter government pretty much made an unmitigated hash of the post-secondary file: cuts to institutional budgets, commissioning a visionary report on the future of the University System in the province and then more or less ignoring the results, etc.  But they have a fresh new set of proposals they’d like you to believe in.  It’s a three-parter: first, requiring PSE institutions to have policies on sexual violence; second, reduce tuition fees by 10% over four years and third, eliminate tuition at the Nova Scotia Community College (NSCC) altogether, a policy which faithful readers know I think makes a lot of sense).  Unlike the Tories, they seem to have more or less costed this correctly.   $38 million a year at full phase-in for the cut to university fees is a bit low because it seems to be based on 2014-15 fee income, but if you assume international students are exempted it will work just fine.  $36 million to get rid of fees at NSCC is about dead on, too.  The half-million for institutions to adopt policies about sexual assault is a bit of a mystery, but we’ll let that one go.  Total: $74.5 million, of which $74 million goes to students.

For those keeping count, that makes for somewhere in the neighbourhood of $140 million in total promises to students, and as near as $0 as makes no odds to universities and colleges (or negative $30 million, depending on how you count the Tory pledge).  Now, it’s not that any of these parties are actually going to freeze funding for four years.  More likely, you’ll see post-secondary spending rise more or less in line with nominal GDP growth, or a bit slower.  But that, as we all know, does not cover increases in running costs, which – since it’s a labour-intensive operation, naturally run consistently above inflation.

So whatever way this goes, we’re talking cuts at institutions to (in part) make PSE cheaper for students.

You can see how this will play out.  Universities, faced with cuts, will ask to raise fees. Politicians will grandstand and say: “Look at all the cuts you’re making.  Why should students pay more and receive less?  ”.  Institutional heads will then have to decide whether to tear their hair out in frustration or just go and recruit a boatload more international students to make up the difference.  No prizes for seeing how this will go.

This is not just a Nova Scotia phenomenon, of course.  More or less every provincial government has been doing this “feed-the-students, starve-the-institutions” for the last six years.    There’s no earthly rationale for this approach other than vote-buying.  It’s short-sighted, and needs to stop.

As for which party has the best policies?  Well, scratch the Tories.  I like the vision in the free community college pledge in the NDP platform, but a) distrust the execution because of the Dexter government’s record and b) I think at some point, we have to say no to vote-buying via giveaways to students.  So go with the Liberals.  Yeah, their platform is small, incremental and uninspiring.  But it’s the only one restrained enough to think there might be some money left over for investments in quality higher education.

May 09

Conservative Leadership Platform Analysis

So, I just read through all the thirteen leadership candidates’ websites, looking for their thoughts on all the stuff this blog cares about: post-secondary education, skills, science, innovation, youth, etc.

The things I do for you people.

Actually, it was a pretty quick exercise because it turns out almost no one in the Tory leadership race places much importance on post-secondary education, skills, innovation, youth.  They seem to care a lot about taxes, and immigration (and to a lesser extent guns), but for a party that was in government less than two years ago, the Conservative candidates seem to have remarkably little appreciation for the things that actually drive a modern economy.  Anyways, briefly, here is what the candidates say about the issues this blog cares about.

 Chris Alexander (Former Minister of Citizenship & Immigration, ex-MP Ajax-Pickering): No specific platform on higher education, but the topic does come up frequently in his policies.  Expanding educational exports to Asia is priority.  He says he wants 400,000 new international students/year by 2020 and 500,000 per year by 2023 (I’m pretty sure he does not actually mean “new” as in new visa applications every year, I think that’s total in the country at any one time).  He also wants to spend money on new National Centres of Excellence and Centres of Excellence for Commercialization and Research for the digital economy as well as invest more in research related to art and design (I assume OCAD’s Robert Luke has something to do with that one).  He also has a general pledge to incentivize PSE institutions to collaborate more with “incubators accelerators and companies of all sizes”, whatever that means.

Maxime Bernier (Former Minister of industry, Foreign Affairs, and Min. of State for Small Business, MP for Beauce)The main point of interest in the Bernier platform is the rise in the personal tax exemption to $15,000 per year, which will have favourable impacts for many students.  Under his health platform, Bernier indicates he wants the federal government to vacate the health field and transfer tax points to the provinces; though he does not say so explicitly, it’s a fairly safe assumption that the same would apply to the transfer of funds to provinces for post-secondary education under the Canada Social Transfer.

Steven Blaney (Former Minister of Public Safety, MP Bellechasse—Les Etchemins—Lévis): Nothing at all.

Michael Chong (Former Minister of Intergovernmental Affairs, and Sport, MP Wellington-Halton Hills):  Nothing at all.

Kellie Leitch (Former Minister of Labour and the Status of Women, MP Simcoe-Grey): Nothing at all.

Pierre Lemieux (Former MP Glengarry-Prescott-Russell): Nothing at all.  Are you seeing a pattern yet?

Deepak Obhrai (MP Calgary Forest Lawn)Nothing at all.

 Erin O’Toole: (Former Minister of Veterans Affairs, MP Durham): O’Toole is the only candidate with anything even vaguely resembling plans for science and Innovation in the form of a scheme to extend the notion of “flow-through shares” –a tax gimmick heavily used in resource industries to defray development expenses – to new life-sciences and tech companies as well.  More intriguing is O’Toole’s “Generation Kick-Start” platform, which promises everyone who completes a degree, diploma or apprenticeship with an extra $100,000 of personal exemptions (i.e. $15K in reduced taxes) to be used before they turn 30.  That goes up to $300,000 if their credential in an area where skills are in “short supply” (definition vague but seems to include engineers, coders and “skilled tradespeople” even though 3 years into the oil slump the latter wouldn’t really qualify as “in demand”).  The latter half of the proposal is goofy, but the basic idea has a lot of merit.

 Rick Peterson: (A BC Investment Advisor of Some Sort): Nothing at all.

Lisa Raitt (Former Minister of Natural Resources, Labour, and Transportation, MP Milton). Like Maxime Bernier proposal, Raitt proposes to raise the basic tax exemption to 15K.  She also wants to increase the (totally useless) apprenticeship and completion grant up to $4,000.

 Andrew Saxton (ex-MP, North Vancouver)Saxton’s policy pages are – to put it mildly – light on detail.  However, he says he does want to invest in “skills training to ensure Canadian skills are matched with Canadian jobs” (whatever that means).  Also, having lived in Switzerland for some time, he advocates a Swiss-style apprenticeship program which extends into industries like banking, pharmaceuticals, etc.

Andrew Scheer (Former Speaker of the House of Commons, MP Regina-Qu’appelle) Scheer’s money proposals in education are limited to a pledge that parents of students attending independent schools a tax deduction of up to $4000 tuition annually per child, and a tax credit of $1,000 (i.e. a $150 reduction in taxes) to parents who choose to homeschool their child.  In addition, Scheer pledges that “public universities or colleges that do not foster a culture of free speech and inquiry on campus” will “not have support from the federal government”.  He then lists the tri-councils and CRCs as specific funding mechanisms for which institutions would not be eligible: it is unclear if the ban would include CFI and – more importantly – CSLP.  Note that the ban would only cover public institutions; private (i.e. religious) institutions would be able to limit free inquiry – as indeed faith-based institutions do for obvious reasons – and still be eligible for council funding.

Brad Trost (ex-MP Saskatoon-University): Nothing apart from a pledge for tax support to private education and homeschooling identical to Scheer’s.

And that’s the lot.  I think it’s fair to say that the field’s appreciation for the role of knowledge and skills in the modern economy is pretty weak.   Maybe dangerously so.  Still, if you are voting in this election and you think PSE and skills are important, your best bet is probably Chris Alexander; if you want to raise youth living standards, vote for O’Toole followed perhaps by Maxime Bernier or Lisa Raitt.

(And yes, I know the percentage of Conservative voters motivated by those two sets of issues are vanishingly small, but I only have this one shtick, so cut me some slack).

 

April 17

British Columbia: Provincial Manifesto Analysis

On May 9th, our left-coasters go to the polls.  What are their options as far a post-secondary education is concerned?

Let’s start with the governing Liberals.  As is often the case with ruling parties, some of their promises are things that are both baked into the fiscal framework and will take longer than one term to complete (e.g. “complete re-alignment of $3 billion in training funds by 2024”), or are simply re-announcements of previous commitments (page 85-6 of the manifesto appears to simply be a list of all the SIF projects the province already agreed to co-fund), or take credit for things that will almost certainly happen anyways (“create 1000 new STEM places”…. in a province which already has 55,000 STEM seats and where STEM spots have been growing at a rate of about 1700/year anyway…interestingly the Liberals didn’t even bother to cost that one…)

When you throw those kinds of promises away, what you are left with is a boatload of micro-promises, including: i) making permanent the current BC Training Tax Credit for employers, ii) creating a new Truck Logger training credit (yes, really), iii) spending $10M on open textbooks over the next 4 years, iv) reducing interest rates on BC student loans to prime, v) making minor improvements to student aid need assessment, vi) providing a 50% tuition rebate to Armed Forces Veterans, vii) creating a centralized province-wide admission system and viii) allowing institutions to build more student housing (currently they are restricted from doing so because any institutional debt is considered provincial debt and provincial debt is more or less verboten…so this is a $0 promise just to relax some rules).  There’s nothing wrong with any of those, of course, but only the last one is going to make any kind of impact and as a whole it certainly doesn’t add up to a vision.  And not all of this appears to be new money: neither the student loan changes nor the centralized application system promises are costed, which suggests funds for these will cannibalized from elsewhere within the system.  The incremental cost of the remaining promises?  $6.5 million/year.  Whoop-de-do.  Oh, and they’re leaving the 2% cap on tuition rises untouched.

What about the New Democrats?  Well, they make two main batches of promises.  One is about affordability, and consists of matching the Liberal pledge on a tuition cap, slightly outdoing them on provincial student loan interest (eliminating it on future and past loans, which is pretty much the textbook definition of “windfall gains”), and getting rid of fees for Adult Basic Education and English as a Second Language Program (which, you know, GOOD).  There’s also an oddly-worded pledge to provide a $1,000 completion grant “for graduates of university, college and skilled trades programs to help pay down their debt when their program finishes”: based on the costing and wording, I think that means the grant is restricted to those who have provincial student loans.

The NDP also has a second batch of policies around research – $50M over two years to create a graduate scholarship fund and $100M (over an unspecified period, but based on the costing, it’s more than two years) to fund expansion of technology-related programs in BC PSE institutions.  There is also an unspecified (and apparently uncosted) promise to expand tech-sector co-op programs.  Finally, they are also promising to match the Liberals on the issue of allowing universities to build student housing outside of provincial controls on capital spending.

Finally, there are the Greens, presently running at over 20% in the polls and with a real shot at achieving a significant presence in the legislature for the first time.  They have essentially two money promises: one, “to create a need-based grant system” (no further details) and two, an ungodly bad idea to create in BC the same graduate tax credit rebate that New Brunswick, Nova Scotia and now Manitoba all have had a shot at (at least those provinces had the excuse that they were trying to combat out-migration; what problem are the BC Greens trying to solve?).

Hilariously, the Green’s price-tag for these two items together is…$10 million.  Over three years.  Just to get a sense of how ludicrous that is, the Manitoba tax credit program cost $55 million/year in a province a quarter the size.  And within BC, the feds already give out about $75M/year in up-front grants.  So I think we need to credit the Greens with being more realistic than their federal cousins (remember the federal green manifesto?  Oy.), but they have a ways to go on realistic budgeting.

(I am not doing a manifesto analysis for the BC Conservatives because a) they haven’t got one and b) I’ve been advised that if they do release one it will probably be printed in comic sans.)

What to make of all this?  Under Gordon Campbell, the Liberals were a party that “got” post-secondary education and did reasonably well by it; under Christy Clark it’s pretty clear PSE can at best expect benign neglect.  The Greens’ policies focus on price rather than quality, one of their two signature policies is inane and regressive, and their costing is off by miles.

That leaves the NDP.  I wouldn’t say this is a great manifesto, but it beats the other two.  Yeah, their student aid policies are sub-optimally targeted (they’re all for people who’ve already finished their programs, so not much access potential), but to their credit they’ve avoided going into a “tuition freezes are magic!” pose.  Alone among the parties, they are putting money into expansion and graduate studies and even if you don’t like the tech focus, that’s still something.

But on the whole, this is a weak set of manifestos.  I used to say that if I was going to run a university anywhere I’d want it to be In British Columbia.  It’s the least-indebted jurisdiction in Canada, has mostly favourable demographics, has easy access from both Asia (and its students) and from the well-off American northwest.  And it’s got a diversified set of institutions which are mostly pretty good at what they do.  Why any province would want to neglect a set of institutions like that is baffling; but based on these manifestos it seems clear that BC’s PSE sector isn’t getting a whole lot of love from any of the parties.  And that’s worrying for the province’s long-term future.

March 24

Representing Universities

Some light reading today, after a heavy week.

There’s a lot of talk these days about the political divide between those with higher education and those without. But I want to take you back to a time, where that political divide was made real. A time when universities actually had their own seats in Parliament, non-physical constituencies where the electors were made up entirely of alumni.

The practice of granting universities representation in Parliament seems to originate in Scotland sometime in the late 15th or early 16th centuries; certainly by the time James VI of Scotland took the Crown of England in 1603, it was well established. Upon James’ accession to the throne in London, he created Parliamentary constituencies for both Oxford and Cambridge, and gave each two seats (i.e. they were multi-member constituencies and the top two vote-getters won seats). Oxford’s church connections meant that it reliably delivered Royalist or Tory MPs, and some of the greatest names of the age represented it in Parliament, including Isaac Newton and Francis Bacon. Cambridge, on the other hand, was a hotbed of revolutionary activity and was represented at various points by two of Oliver Cromwell’s sons. Briefly, this system spread to the colonies: in the late seventeenth century William & Mary had a seat in the Virginia legislature.

As university education expanded in the UK, so too did the number of university seats. The University Dublin received a seat at Westminster in 1801 (having previously had a seat in the Irish Parliament). The Scottish universities were not given Westminster seats after the act of union but did receive seats (2 to split between the four of them) in 1868; the University of London was given a seat at the same time. Belfast and the University of Wales were given seats in 1918 as was – very temporarily as it turned out – the National University of Ireland. More interestingly, also in 1918, graduates of all other universities in England were given a combined 3 seats, meaning that in the election of that year, there were a total of 14 seats out of the 707 up for grabs (2% of the total) which were elected solely by university graduates.

There were echoes of this approach outside the UK as well. In Sweden and Finland, for instance, where “estate”-style Parliaments existed well into the nineteenth century, universities received positions in Parliament by virtue of their membership in the clerical estate. Within the British Empire, an attempt to imitate this system died a quick death in Australia (the University of Sydney had a seat in the New South Wales Parliament in one election in the 1870s), but lasted somewhat longer in India.

Elections to these seats were somewhat odd affairs. All alumni of an institution could vote in these elections, and this vote was in addition to their vote as a resident of a particular constituency (readers from British Columbia may remember something similar in that until 1993 business owners could get a second vote in municipal elections if their business was in a different district that their residence). However, to exercise the franchise, voters actually had to come to the university to vote (at some point – I can’t work out when – a postal vote option was added). To accommodate electors, polls were held over several days – usually after the general election. Campaigning was not really “done” and in fact during the voting period candidates were required to stay at least 10 miles away from the university. Of interest to Canadian electoral nerds: voting in multi-member constituencies was done by Single Transferable Vote. Civilization does not appear to have collapsed as a result.

By the twentieth century, these seats still often elected Tories, but it became the custom to elect established academic celebrities or public intellectuals as independents. But their days were numbered: when Labour finally won a majority government in 1945, it abolished all forms of plural representation, and so the last university members of Parliament exited the chamber in 1950.

Curiously, the practice still exists today in the unlikeliest of places. Ireland, which split from the UK in 1922, retained the concept of university constituencies in its Parliament (Dáil) until 1937. Under the new constitution of that year, the University of Dublin and the National University of Ireland each received 3 seats in a 60-seat Senate, which they retain to this day. This makes more sense if you understand that the Senate of Ireland is one of the world’s most deeply bizarre legislative bodies, where 100% of the membership is indirectly elected through various corporatist bodies.

Bon weekend.

 

February 22

Notes for the NDP Leadership Race

As contestants start to jump into the federal NDP leadership race, it’s only a matter of time before someone starts promising free tuition to all across the land.  Now, I’m not going to rehash why free tuition is both regressive and undesirable (though if you really want to take a gander through the archives on free tuition, have a look here).  But I do think I can do some public service by talking about federalism and higher education, or rather: what the feds can and cannot do in this sphere.

The entire Canadian constitution is based around a compromise on education dating from 1864.  Upper Canada came to the Quebec conference with one overriding aim: representation by population in Parliament, so that their superior population would give them the most seats in Parliament.  Lower Canada agreed if and only if a second, local, and equal tier of government was created which would have jurisdiction over education and health, because over-their-dead-bodies were a bunch of (mostly) Orangemen going to get their hands on a hallowed set of (mostly) French catholic institutions.

There’s nothing in there that stops Ottawa’s ability to give money to individuals for the purpose of education.  This is why, despite all the sturm und drang, Quebec never put up a legal fight to the Canada Millennium Scholarship Foundation: Ottawa can give cash to whoever it wants, whenever it wants.  But when it comes to dealing with institutions, their ability to direct money to areas of provincial jurisdiction is subject to provincial veto.  The provinces accept (with limits, in Quebec’s case) that the feds can flow money to institutions for the purposes of academic research.  Hence the Canadian Foundation for Innovation.  They do not accept that it can send money to institutions for operating purposes.

(Historical footnote: there was a period where nine out of ten of them were prepared to accept this.  Back in the mid-1950s, there was a ruse in which the federal government handed tens of millions of dollars every year (a lot back then) to Universities Canada – then known as the National Conference of Canadian Universities and Colleges – which it would then distribute to institutions.  In theory this was a canny work-around to the constitution.  In practice, it stalled because Duplessis blew a gasket and told Quebec universities that if they touched a dime of that money, he’d take it out of their provincial funding.  Pierre Elliott Trudeau then wrote a wonderful article in la Cite called “Federal Grants to Universities” explaining why Duplessis was 100% right and St. Laurent was in kookooland, constitutionally speaking.  It’s a great article, read it if you can.  Anyway, this arrangement lasted into the 1960s, when the feds got out of this arrangement and moved into per-capita grants instead.  And that door is now shut: there is no going back through it.)

Politically, there is a fantasy shared by some on the political left that the federal government can simply re-acquire policy leadership in the post-secondary field by passing an act of Parliament and adding great wodges of cash to existing transfers… with strings attached.  I’ve previously (here) torn a strip off the idea of a federal Post-Secondary Education Act, but let me focus here specifically on the idea that a generalized fiscal transfer could actually affect tuition fees.  Let’s just imagine how that discussion would go.

Ottawa: we want to give each of you money so that you bring your tuition fees to zero.  Quebec and Newfoundland, your fees are about $3000, so we’ll give you that per student…

Ontario: Our fees are $7500 a student or so.  Fork it over.

Quebec and Newfoundland: Hold it.

I could go on here about the nuances of fiscal federalism, but basically that’s the problem in a nutshell (for my American readers: in some less disastrous timeline, Hillary Clinton is facing exactly this problem as she attempts to implement her free tuition promise for public universities). There are ways the federal government could bribe provinces into lowering tuition.  In fact, something like that actually happened in Nova Scotia as a result of the NDP-Liberal budget deal in the minority Parliament of 2005.  But you wouldn’t necessarily get them to lower by an equal amount, and you definitely wouldn’t get them to go to zero because they have vastly different starting points.

So, here’s the quick heads-up to all prospective New Democrat leadership candidates: even if it wanted to, the Government of Canada has no sensible way to eliminate tuition nationally.  If you do manage to form a government, this will be broken promise #1.  So don’t promise it.  Instead, think about ways to support students which don’t involve tuition.  There is a whole whack of things you could do with student assistance instead.  And the best part is: if you use student aid as a tool instead of tuition, you can channel aid to those who actually need it most.

January 19

American Higher Education Under Trump

Tomorrow, Donald Trump will be sworn in as the 45th President of the United States (actually, the 44th person to be President: Grover Cleveland’s two non-consecutive terms screw up the count).  What does this mean for higher education?

First off, let’s recollect that where higher education is concerned, the US, like Canada, is a federation where the main decisions about funding public education are made at the state level. Decreased state investment in institutions and consequent rises in tuition have given the federal government a larger though indirect role in the system because the salience of student aid has risen.  And of course, the government spends an awful lot of money on scientific research, primarily but not exclusively through the National Institutes for Health (NIH) and the National Science Foundation (NSF).  And let’s also recollect that while the President names the Secretary of Education, a lot of control over specific budget items rests with Congress, which, despite being controlled by Republicans, will have ideas of their own.

Recall that Trump barely spoke about higher education during the campaign, other than endorsing an even-more-expensive version of income-based repayment than the existing one which was recently discovered to be costing nearly over $50 billion more than expected (short version: he wants to raise the repayment maximum from 10% of income to 12.5% but shorten the time before forgiveness to just 15 years).  Also, his education secretary Betsy DeVos, is a K-12 specialist (I’m using the term loosely) with very few known views on higher education.  I think it’s a given that their instincts will anti-regulatory and pro-market (which means things are looking up for private for-profits), but it’s hard to see them initiating a lot of new policy.  Which means the policy reins, such as they are, will likely be held by the Republican Congress and not the White House.

So what to expect?  Well, I think we can rule out any continuation of the Obama White House’s free college agenda, or anything vaguely like it.  That idea won’t disappear, but it’s something that’s going to happen in the states rather than in DC (witness Andrew Cuomo’s decision earlier this month to launch his own Ontario-like free tuition-plan).  Beyond that, you’re likely to see some cutting back on institutional reporting requirements, particularly with respect to Title IX, the federal law on sex-discrimination in education, and possibly a push towards more competency-based education.

Where it gets interesting, though, is on student-aid.  It’s not just that we’re likely to see cuts in things like loans to graduate students and (pace Trump’s own views) loan forgiveness.  We may see a return to more private capital in student loans (which would mostly be a bad things); we may also see institutions be required to pay for some of the costs of their own students’ loan defaults (an idea colloquially referred to as requiring institutions to have “skin in the game”.  Some think that the new Congress may push what are known as “Income Share Agreements”, which are kind of like graduate taxes only the entity giving the student money and then collecting a percentage of income afterwards is some kind of private investment firm rather than government.  One of the most crazy/plausible ideas I’ve heard is from University Ventures’ Ryan Craig who mused recently on twitter about setting rules whereby institutions might have to provide a certain fraction of total aid via ISAs in order to be eligible to receive federal aid.

On the research side: who knows?  Clearly, climate science is going to have a hard time.  But health sciences often do well under Republicans; the National Institutes of Health went from $18 billion/year to $30 billion/year under Bush Jr, for instance.  And Trump might decide to do something big and crazy like announcing a lunar base or a Mars mission (the former is a favourite of Newt Gingrich, the latter an obsession of Elon Musk, who suddenly seems quite close with the incoming White House), either of which would have substantial positive ramifications for university science budgets.  So we’ll see.

But put all this into some perspective: as far as Congressional priorities are concerned, changes to student aid are going to come several light years behind repealing Obamacare and dismantling various environmental protections.  The former in particular has some pretty serious budget impacts as repealing Obamacare is going to cost a ton of money.  That’s going to cause a scramble for offsetting budget cuts – one could imagine some pretty big across-the-board cuts in which higher education-related programs will simply be collateral damage.

It’s bound to be interesting, anyway.  Though I for one am glad I get to watch it all from a safe distance.

January 12

Post-Brexit Options

One highly amusing by-product of the frantic Canada-EU-Walloon trade negotiation finale last fall was watching the UK government suddenly realize that negotiating agreements with a 27-country trade bloc is actually really difficult and that this Brexit thing is almost certainly not going to end well.  Which of course has some reasonably significant implications for UK universities.  But how exposed are UK universities to Brexit?

Arguably, the bigger post-Brexit implications have to do with staff who may be denied residency, future staff who won’t be allowed entry and broken research partnerships with EU-funded colleagues on the continent.  But I’m going to limit my analysis here to the student intake because it’s a little easier to quantify.

Let’s at what’s at stake for the UK in terms of international student numbers.

UK International Student Numbers by Country of Origin


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Source: UK Council for International Student Affairs. EU shown in red, non-EU in blue

Somewhat surprisingly (to me at least), only about 30% of the UK’s international student body comes from the EU, with Germany and France the largest source countries.  That’s about 125,000 students, paying roughly £9,000 per year, so that’s a £1.1B hit to the sector.  That sounds big (and of course it’s nothing to be sneezed at), but in a sector worth around £33B, it’s not *that* crucial.

Now, how much of this money would institutions actually give up if Brexit goes through?  That’s still a big unknown, because it depends on how many foreigners will be allowed to get visas post-2019 and whether or not students will be considered within the cap.  For the past few years – since now-PM Theresa May became Home Secretary in 2010 in fact – the Home Office has been including non-EU students in the cap, and as a result international student numbers have been falling for quite a while now and are now about a third lower than they were before the Cameron government took office.  A similar result with EU students would see a loss of about £400 million to the sector.

But, say some, that’s without accounting for any loss from higher tuition fees.  Pre-Brexit, EU students pay what domestic students pay.  Post-Brexit, they will in theory pay a higher “international” fee.  These fees depend on the type of course undertaken: they average £13,394 for lecture-based programs, £15,034 for laboratory-based programs and £24,169 for clinical disciplines (see here for more details).  Some feel that a shift to these higher fees may deter even more students.  Frankly, this is a weak argument: if institutions really want foreign students, they can lower the fees (the bigger threat is probably these students’ loss of access to UK student loans, without which many might find even the current fees a struggle to bear).  And anyways, these higher fees mean that if UK universities only lost 1/3 of their EU students, they’d actually be up on the deal thanks to higher tuition rates.

Anyways, as you can tell, I’m not convinced that the loss of EU students is in fact a major challenge to the UK higher ed sector, though obviously it might be to specific universities who are overweight with this group.  It certainly makes you wonder why some institutions are musing about creating “overseas” campuses inside the EU (see here, here).    The answer, primarily, is that these proposed campuses are about trying to get around research collaboration barriers more than they are about gaining student numbers through branch campuses. I can’t actually imagine many EU countries (or the EU itself) would be daft enough to leave such loopholes open, but you never know.  But in any event, branch campuses are high-cost, high-risk and for students tend to be very much second-choice to home institutions.  If there are a lot of frustrated, wannabe-English students in Europe as a result of Brexit, they’re probably likelier to head to Ireland or North America as they are to go to University of East Anglia – Lens, or University of Chichester-Malmo.

In short, the student-side of Brexit should be a lot less concerning than the staff side of Brexit.

October 11

Hillary’s Higher Education Plans

Barring some sort of catastrophe, it now seems pretty clear that Hillary Clinton will be the 45th President of the United States.  There is a reasonable chance (51.6% in Monday’s FiveThirtyEight forecast) that the Democrats could regain the Senate and an outside chance that they could also regain the House.   Those odds probably change a bit in the Democrats’ favour once some post-grope polls come out later this week, but the basic outline of a post-November 7 world – Hillary in charge, with a split Congress – is now pretty clear.  What does it mean for higher education?

Well, you wouldn’t know it from any of the debates – we’ve now gone 270 minutes without a single second being spent on education – but higher education is a major plank in Hillary’s platform.  But her policies on higher education have evolved somewhat over the course of the campaign, mostly because her primary opponent Bernie Sanders’ success with millennials convinced her she needed a big, expensive, youth-oriented policy, and higher education (apparently) is it.

Hillary’s plan, release just prior to the July convention and known as “The New College Compact” consists of two pillars.  The first involves creating a system of “free tuition” at public universities for students from families with under $125,000 by 2021 (it would start at $85,000 in 2017 and rise by $10K each year thereafter) .  On the fact of it, this is a bit like what the Ontario Liberals and the Chilean socialists have developed, only more generous (i.e., using a higher cut-off point).  But the costing on this plan is – to put it mildly – hazy.  Her costing documents speak of spending $450 billion over ten years, but the tuition take from 4-year public alone is north of $55 billion, and that’s not including either the cost of 2-year colleges or the extra costs that would accrue if free tuition induced hundreds of thousands of students from private colleges to switch into the public system (the New America Foundation has correctly warned that not including funding for system growth could well result in a reduction of access for lower-income and minority students as middle-class students switching from privates could push out less-prepared lower-income kids from a fixed number of spaces).

The problem here is that the US (like Canada) is a federal system, with education a responsibility of the states.  The federal government can promising anything it likes about tuition, but at the end of the day it is states who have the final say.  The best the feds can do is work out a system of carrots and sticks to entice the states into a program.  The wording of the plan seems to imply that states who want to get reduce tuition will sign up for grants from Washington in return for meeting certain conditions – one of them being pouring more money of their own into their systems.  But the progress of Obamacare, which required considerably less from states but has only brough two-third of states on board so far, should give everyone pause.  On top of that, of course, the President alone can’t appropriate funds unilaterally.  Congress would need to be on-side as well, and the Democrats are still a long way from being able to make that happen.  Which is why most higher education analysts in the US seem to assume that the plan is more talk than action: a rhetorical statement which can attract voters rather than a plan likely to be implemented.

The second part of the Clinton plan involves a three-month moratorium on student loan repayment allowing all borrowers – including those in repayment – to re-finance their loans at a lower rate.  There is a fair amount of scepticism about how effective this measure might be.  As Robert Kelchen of Seton Hall University (possibly the shrewdest US student loans pundit out there), wrote in The Conversation a couple of months ago, the most-indebted graduates tend not to be the ones with the high default rates because default is most commonly associated with dropouts and hence lower levels of debt, and also because over 40% of borrowers in the US are now in income-based plans and so changing the level of interest will have minimal effects on repayments.  In other words, it will be a big income transfer to younger Americans, but not necessarily one that will do much to increase access or reduce defaults.

So after the election, what we can probably expect is a situation quite similar to what we had prior to 2014: a President and a Senate with a desire to make college more affordable (though not necessarily in particularly efficient ways), with a House implacably opposed and states offering indifferent support.  But a catastrophic Republican result in the House – which remains a possibility following this weekend’s stampede of defections – might result in some very rapid and drastic policy changes from the new administration.

Stay tuned for November 8th. 

September 29

The Ontario NDP’s Bad Student Loan Math

The Ontario NDP have started down the road to madness on student aid.  Someone needs to stop them.

Here’s the issue: the NDP have decided to promise to make all Ontario student loans interest-free.  As a policy, this is pretty meh.  It’s not the kind of policy that increases participation because students don’t really pay attention to loan interest, and it’s not going to make loans a whole lot more affordable because Ontario forgives most loans anyway (as a consequence something like 90% of all loans in repayment in Ontario are federal loans which wouldn’t be subject to this policy).   My back-of-the-envelope calculation is that this policy might save a typical borrower in repayment something like $5/month, which isn’t a big deal as far as affordability is concerned.  One could argue that affordability of loan repayments shouldn’t be a big priority since loan payments as a fraction of average graduate income has gone down by about a third in the past fifteen years, but on the other hand, this isn’t likely to cost very much either, so really, who cares?

No, the problem isn’t so much the proposed program as it is the tagline that’s gone along with it. To wit: “The government shouldn’t be making a profit from student debt”.

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I mean, where to begin with this stonking bit of nonsense?

The worst-case interpretation of this is that the NDP actually believes that “interest” equals “profit”, or, to put it another way, that money has no time-value.  Read literally, it suggests that all interest is usury.  The NDP is sometimes accused of being stuck in the 70s as far as economic policy is concerned; this particular slogan suggests it might be more 1370s than 1970s.

More likely, though, this is the NDP aping Massachusetts Senator Elizabeth Warren, who has been saying these kinds of things about US student loans for a few years now.  The essence of the critique is this: governments borrow money cheaply and lend to students at a higher rate (in the US, the rate on Stafford undergraduate subsidized loans is the 10-year Treasury rate plus 250 basis points, and somewhat higher for other types of public loans).  The gap between the two rates is needed because of course the government loses money on loans through loan defaults (it also loses money by assuming the loan interest while a student is in school, but that’s a separate issue).  For reasons beyond comprehension, the US government does not base its financial calculations for student loans on actuarial reports which are linked to actual student behaviour, but rather according to “standard conventions”, one of which essentially assumes no loan losses at all.  It is by using this convention – i.e. basically ignoring all actual costs – that Warren came to the conclusion that student loans “make money”. For a more complete description of why this is total nonsense, check out Jason Delisle’s work on the subject here as well as articles from the Atlantic, the Washington Post and the Brookings Institute.

But even to the limited extent the Warren critique makes sense in the US, it doesn’t work in Ontario.  OSAP loses money.  A lot of it.  It doesn’t publish numbers directly on this, but it’s easy enough to work it out.  Ontario 10-year bonds go for about 2.5% these days, and OSAP lends to students at prime + 1%, or about 3.7%.  So Ontario’s spread is only 120 basis points, or half the American spread (CSLP loans, are different: the feds borrow at 1% and lend at prime plus 250 basis points, for a total spread of 420 basis points).  120 basis points per year is not much when you consider that simply covering the cost of borrowing while students are in school is twice that.  Basically, it means that for someone who borrows for four years, the government loses money every time they pay back the loan in less than eight years.  And that’s not counting the cost of defaults, which are in the tens of millions of dollars each year.

Put simply: Ontario students get to borrow at zero interest while in school, and positive-but-below-market rates after graduation despite default rates which are astronomical by the standards of any other personal loan product.  That costs the government money.  If it defrays some of that cost through an interest rate spread, so be it – that does not constitute “making a profit”.  It is simply stupid of any political party which wishes to be entrusted with public finances to suggest otherwise.

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