Oregon Tuition Plan: Here's Why Free College Isn't Enough

Last month, the Oregon state legislature passed a bill (to form a committee to look at the possibility of passing a future bill) that would put the state down a path towards free college tuition at all public universities. The proposal drew heated reactions from both advocates and opponents, and blurred typical party lines. But putting aside the policy nitty-gritty, what is at stake here is whether we think public higher education should be a universal program or an individual luxury good. Most progressives and advocates of increased college access favor the former.

The liberal blogger Matt Bruenig, however, lays out the case for a different strategy. In his view, only users of college should pay because the non-users are predominantly poor. The benefits of the Oregon plan, then, are that it narrows the group of people paying for college from society at large (in the form of tax revenues) to only users of college, but does not put the onus on any specific individual in the form of crushing debt. Unlike simply increasing tuition for each student, a plan like Oregon's puts the cost on the entire group of students that have used the college’s services.

The difference between an Oregon-style repayment plan and a more universally funded system is whether the additional cost should fall on the entire population, or just on current and previous college “users.” Bruenig wants to just charge the latter to ensure that the non-college poor and working classes are not subsidizing the rich. I, however, think a more universal system is preferable to an Oregon-style plan. Here’s why.

First, even though postsecondary education is not currently a universal good, that is not to say it shouldn't be. As an advanced society, we should provide a quality postsecondary education, ranging from technical training to the liberal arts, to any student who wants it. Either a more universal system that keeps costs low or a no-debt plan could solve this problem. But while they may achieve the same ends in theory, having a universal program is an acknowledgement of our priorities: It is important to us as a society that we recognize that higher education is valuable and important.

I agree with Bruenig and the view of labor-oriented progressives that education alone is not the answer to inequality, and that we need strong labor policies to reduce the absurdly high sticker price of college — one that, despite what many economists say, is pretty arbitrary. But even if we recognize that education is not the sole answer to our economic problems, it can still be a good that we view as valuable for its own sake

Another of the biggest problems with the Oregon plan as it currently stands is the issue of public versus private higher education. While Bruenig is concerned with the working poor paying for the rich and middle classes to go to college, I am concerned with the rich not paying for the middle classes to go to college. Oregon’s plan only applies to public education, not private education, which means that students who attend private colleges do not pay for public education.

When a parent chooses to send their child to a private high school, they still have to pay local taxes to fund public education. Even if they do not use the public services, it is important that they contribute to ensure that the public services are funded.

Critics of Rick Perry’s $10K college plan in Texas have already argued that public colleges will get shortchanged relative to private ones under a $10K plan. If we make our public colleges relatively less competitive than the private ones, we once again hurt the lower and middle classes at the expense of the rich.

So let's imagine that we could make the Oregon system national, and include both public and private students. Now there are no adverse selection or competitiveness issues. Would this be better than a universal funding program?

My answer is again no. At that stage, the two programs become nearly identical and the minor differences weigh in favor of universal funding.

If the Oregon-style plan is done on a national level for all college graduates, the group shouldering the cost burden would be entirely composed of college graduates. This share of the population is similar to the top half of the population, as postsecondary graduates tend to make much more money.

National funds are more progressive than state funds because they are funded from income taxes rather than property or sales taxes. If we had some sort of national program, then, the funding source would be highly progressive income taxes. Only the top half of the population, give or take, pays income taxes, so this is essentially the same group as those who have graduated from college.

If this is the only difference, the universal program is preferable for two reasons. One, it includes rich non-collegians, who would otherwise not be subject to helping fund public education. Second, as mentioned earlier, it is an indication of our priorities. If we want to value higher education as a universal good that has value for its own sake, funding it in a less targeted sense is crucial.

Even though I am a sympathetic to the arguments in support of the Oregon plan, I think a universal funding mechanism is the best strategy. Our focus should be on how to ensure that funds for higher education are increasingly progressive, so that we can keep public college affordable and ensure that those who went to private school – like myself – are not let off the hook.