Hillary Clinton, who’s visiting Las Vegas today as part of her campaign for the Democratic Party presidential nomination, says “no family and no student should have to borrow to pay tuition at a public college or university.” She thinks “everyone who has student debt should be able to finance it at lower rates.” And she says she has a new plan to make higher education more “affordable.” Her $350 billion proposal supposedly would help millions of students pay for college while also reducing interest rates for people still paying down student loans.
But there’s nothing new about Mrs. Clinton’s New College Compact. In fact, the plan will further increase, not reduce, the cost of college.
Going back to the 1960s, the federal government has sent a steady stream of cash to colleges and students. Instead of passing along savings to their students, however, colleges have kept the federal subsidies and passed on higher tuition costs. According to a July report from the New York Federal Reserve, for every additional dollar in aid and subsidized loans colleges receive, they raise tuition as much as 65 cents.
Of course, the Clinton campaign says things will be different this time. Higher education has to be more accountable, they say, and the federal government has to do more to make sure colleges and universities are. The money colleges receive will be earmarked for “instruction and learning” and boosting graduation rates, and institutions that produce graduates who can’t pay back their loans will be subject to penalties.
Sure, that all sounds great, but we’re fooling ourselves if we think colleges and universities will go along with increased scrutiny or freezes on tuition increases. No, what we will see, as The Wall Street Journal points out, is nothing more than a faculty pay raise disguised as loan forgiveness.
Not surprisingly, this program will be extremely expensive. According to the Clinton campaign, it’ll cost roughly $35 billion a year — approximately the same as the Pell Grant program. To pay for it, Mrs. Clinton says (also not surprisingly) she’ll close “tax loopholes and expenditures on the most fortunate.” That’s a euphemism for a tax increase.
Contrary to what she wants voters to believe, Mrs. Clinton has no interest in making college more affordable. She just wants someone other than students to pay the growing bill. Her plan will result in more burdens for federal taxpayers, as well as more federal coercion to compel state taxpayers to pump more money into their public colleges and universities.
We’re not doing students any favors by giving them super-cheap loans or even free tuition. All this does is increase demand for classes, which compels colleges and universities to admit students who aren’t prepared for the rigors of higher education and increase their prices even more. It’s blatant vote buying, and young American voters shouldn’t fall for it.