By: Timothy Benson
In what appears to be the opening salvo in his reelection campaign for 2018, never mind the 2020 presidential election, New York Gov. Andrew Cuomo (D) is introducing a plan costing $163 million annually to provide “free” tuition at all Empire State public colleges and universities for students whose families are earning up to $125,000 a year.
Free college! Every little Horatio and Horatia Alger, from Champlain to Buffalo to Montauk, no matter how poor, will be able to get their secondary education without having to spend a single red cent on tuition! What’s not to love?
While this proposal will theoretically lead to more poor New York kids being able to attend college, it is useful to remember the old adage that if something sounds too good to be true, it probably is.
For starters, most of the kids who will be helped by this bill are solidly middle class, even relatively affluent, not poor. New York’s median household income is just under $61,000, meaning students whose parents earn over twice that will be eligible under Cuomo’s plan. Yes, this plan would mean New York’s lower- and middle-class families will be paying taxes to subsidize the higher education of children of their affluent and upper-middle-class neighbors.
Meanwhile, Matthew M. Chingos of the Urban Institute, a liberal think tank, argues the proposal would do “nothing” to benefit poor students, “for whom existing grant aid already covers” New York’s four-year average tuition at a state school.
“Cuomo has proposed only covering the difference between tuition and students’ existing aid, meaning that those who get the most aid benefit the least from the proposal,” wrote Chingos. “Consider the State University of New York at Albany, where tuition is currently $6,470 per year for in-state students. SUNY Albany students from families making less than $30,000 receive more than $11,000 in grant aid, mostly from Pell and a state-specific program. As a result, tuition is already free for them and they receive no additional benefits under Cuomo’s plan.” Meanwhile at SUNY Albany, “students from families making between $75,000 and $110,000 currently receive less than $700 in grant aid, on average. That means they face a bit under $6,000 in tuition payments each year, which the Cuomo plan would cover for them.”
Let’s also examine some of Cuomo’s comments:
“It is incredibly hard, and getting harder, to get a college education today,” he said. “It is incredibly expensive, and the debt is so high it’s like starting a race with an anchor tied to your leg.”
All of this is true, but a big reason the problem exists is because aid programs, such as Cuomo’s, are rapidly increasing tuition rates. If colleges know federal and state governments are going to be providing massive amounts of tuition assistance, they know they can continually increase tuition without any market repercussions. The spigot will always be open.
The Federal Reserve Bank of New York released a report in 2015 showing federal student aid programs are a major factor in driving up tuition costs. For each dollar a student receives in Pell Grants, tuition increases by 55 cents. For each dollar of Direct Subsidized Loans, tuition increases by 65 cents. Since 2000, in places in which Pell Grant spending has tripled and spending on education tax credits has quadrupled, out-of-pocket tuition costs have risen by 6 percent per year, on average. To put that in perspective, medical care costs have risen by only (only) 3.8 percent per year over that period.
“College is a mandatory step if you really want to be a success,” Cuomo said. “And the way this society said we are going to pay for high school because you need high school, this society should say we’re going to pay for college because you need college to be successful.”
This is manifestly not true and pretty insulting to the guys and gals in trades and other blue-collar positions that provide them and their children a pretty nice life. Moreover, it’s a part of the fetishization of college education that has contributed to skyrocketing tuition and has helped to cause the value of a bachelor’s degree to drop like a stone. Only one-third of people who enroll in college graduate and wind up in a job that requires a college degree, and almost half of recent college graduates are currently working in jobs that don’t require one.
With this plan, Cuomo gets to champion himself as a friend to the poor, as well as virtue signal to the more progressive wing of the Democratic Party and college-aged Millennials, all in an attempt to burnish his image on the national stage. But don’t be fooled; this is nothing more than a welfare program for the upper middle class, and it will do nothing to decrease the cost of going to college in New York.
Timothy Benson ([email protected]) is a policy analyst with The Heartland Institute, a free-market think tank headquartered in Arlington Heights, Illinois.