An Argument About the Effects of Tuition Reductions

At various times in the past (herehere, and here, for example), I have made the argument that lowering tuition fees is regressive because the benefits will accrue to people who are either the children of the wealthy, or people who will be wealthy, or both.  I have also said that where neither of those conditions is true (for example, some types of community college programs), there is a reasonable case for free tuition.

As a rule, people who disagree with this position make one of three tactical responses.  The first is to hurl abuse, usually with the word “neo-liberal” thrown in for good measure.  These people we can safely ignore.  The second is to take the Hugh McKenzie-CCPA route, which is to say it’s OK to have these kinds of transfers to the rich because they pay more taxes than everyone else.  This is not prima facie idiotic, but it’s a very, very difficult argument to make as a progressive.  In fact, you can only really make it through a syllogism like this: “I am progressive.  I made a statement.  Therefore the statement is progressive”.  Evaluate as you will.

But there is also a (rarer) third response, which says: “ah, but you’re only looking at ceteris paribus results.  Surely free tuition would bring all sorts of new students to the table, and change the benefit calculus.”  Now it is undeniably true that *if* there was a massive shift in demand, then my argument would be wrong.  So let’s look at that *if* – how likely is it to happen?  What would have to happen in order for such a shift to take place?

Let’s look at this logically: would lower fees make anyone less likely to want to attend higher education?  No.  So any shift is not going to come from a fall in demand from upper-income groups, it’s going to have to come from a surge in demand from lower-income youth.  That’s possible, though unproven. There is, for instance, no data from either Manitoba or Newfoundland to suggest that this is what happened when they reduced tuition over a decade ago.  But let’s assume for the moment it’s true.

Now, you have to ask the question: even if aggregate demand increases, are universities likely to take in more students as a result of fee reductions?  Unless you’re also assuming that governments are going to spend a whole extra wad cash for expansion, on top of cash for eliminating fees (NB: the Green Party plan for free tuition in Canada does not do this; neither does the Chilean free tuition experiment), the answer here is “probably not” (or at least not much).  But if the supply of spaces is more or less fixed, then for any benefit-shifting to happen, additional students from poorer backgrounds are actually going to have to displace richer kids in order to close the gap.  Poor kids in, rich kids out.  That’s not an impossible outcome, but given that: a) universities ration places through grades; and, b) youth from higher-income families have an advantage in terms of academic preparation (go see any number of PISA studies on that one), it seems very unlikely.

But let’s suspend disbelief, and assume governments ARE in fact prepared to both reduce price and expand capacity.  What wold happen then?  Well, we don’t know, really.  But we do know that governments have been expanding university capacity tremendously over the past 15 years – partly through higher funding, and partly through higher fees.  And as far as we know (and admittedly we don’t know as much as we should), access has in fact been widened, at least as far as ethno-cultural backgrounds are concerned.  But that raises a question: if you can improve access simply by increasing capacity, why not just do that instead of spending all that money to also make it free?

In short, we know a way to improve access, and it doesn’t involve making higher education free.  Conversely, we know that making higher education free, on it’s own, is very unlikely to change the social composition very much (i.e. it won’t be effective on its own terms), and therefore will provide extraordinary benefits to children of upper-income families.

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4 responses to “An Argument About the Effects of Tuition Reductions

  1. I agree with much of what you (Alex) say. But you miss three main developments in university history since 1944, if only because you stay so close to the point with which you begin. I fear it is too narrowly put. How about considering three more, slightly broader points?

    (i) First, the great and successful British experiment with direct grants to students under the 1944 Butler Act, thus providing cash to pay tuition, food, supplies, and rent costs. This was means-tested, and students still had to be accepted at a university somewhere in the U.K. Yet after 1944 there were university students from the upper reaches of the working class, and the lower reaches of the middle class, where there had not been any such students before. Even Oxford and Cambridge acquired some of these, so the results for the ancient universities were what you’d expect: some of the best academic work in the entire history of those places was done after World War II, by students and by profs, partly because of the fillip these places got by welcoming a socially more diverse student body. The Butler Act (1944) showed that free higher education was truly free-and-freely-accessible ONLY if it involved payments to students that covered **all their basic necessities**. Your emphasis on tuition costs is correct, just because that’s what people are talking about after Elizabeth May’s proposal to make tuition free. But this makes the discussion too narrow.

    (ii) Student debt is a real problem. Student debt arises mostly from paying the cost of living (rent, food, and so on), not so much from tuition fees. Far too many students hold jobs and work part-time or full-time while at university. The results? They are half-asleep in class, they are unable to participate in nearly all aspects of student cultural/intellectual life outside of class hours, and they are still in debt at the end of their programmes of study. Young people in all classes of society know these facts. We have to do something about student debts/loans if there’s to be an uptick in student numbers, and a further vitalization of Canadian higher education.

    (iii) If we significantly increase the number of places in our universities, we’ll come under even greater pressure to say what we REALLY want in our curricula, how we want to govern the university, and what we think the exact powers of management should be. I’m not sure one should ask the question in the narrow way you do, without also asking about the **consequences** of answering the question–in whatever way–no matter what the answer.

    1. Hi Bill. Thanks for writing. Let me respond

      i) You’re mostly right that there was a democratization of HE in Britain post 1944. And that was due in part to free tuition plus grants to needier students. But the argument that it also required giving free tuition to the sons (and less frequently the daughters) of the aristocracy simply doesn’t pass muster. And, I;d argue, a similar democratization happened in the US in the 1950s and 1960s (also a “golden age” of academia) without eliminating fees.

      ii) student debt is certainly problematic for some students. But debt levels in real dollars have been pretty constant for the last 15 years, in which time participation rates have risen by roughly 50%. So the proposition that an uptick in student numbers requires that “something be done” about debt doesn’t seem to be empirically true. That’s not to say one could pile debt on indefinitely; just that present levels don;t seem to be a barrier to increased participation.

      Btw, just finished your recent(ish) books on university governance. Quite enjoyed it. Thanks.

  2. 1. It’s remarkable that you claim that responses involving a commentary on the political economy of financial aid, neoliberalizafion in particular are “abusive.”

    2. It’s further remarkable that you ignore rigorous evidence on the impacts of price reductions on enrollment of the poor, most recently from TX and TN.

    Many changes would accompany the free college proposals under discussion. They are packages of changes and not limited to changes in price. Your efforts to evaluate their effects so narrowly are extremely limited.

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