11
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The dollars and sense of free college - Georgetown University analysis of Biden's free college plan finds that it pays for itself within a decade
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- Title
- The Dollars and Sense of Free College
- Word count
- 33 words
Ugh these hard income-based cutoffs create such nasty incentives. For one, in many metros in the country $125k a year is basically the minimum income to maintain a family of four. This includes New York, San Francisco, San Jose, and a host of other big cities.
Secondly, it creates an extreme effective tax rate. Suppose tuition at a college is $60,000 per year. This means that a family in LA with 1 college aged kid that makes $124,999 is effectively paying around $28.5k in taxes, but an otherwise identical family that makes $125,001 is missing out on $88.5k instead.
Where is the logic in this? How does this seem like a thing that makes sense to anyone?
The logic is just that there's a cost to complexity in public policy. The more complex and nuanced your plan, the more likely for bureaucratic and other execution based errors. Plus more nitpicking from Congress. So the hard cutoff is an imperfect, but simple, way to means test this.
Graduated fall offs are not very complex and add negligible additional bureaucratic overhead as it’s determined by plug-and-play formula.
The chart on the site estimates $75 Billion per year by year ten.
Why is it that public services like education or even USPS are always subjected to being cost neutral, but this demand is never placed on military, intel, or LEO budgets that are substantially greater than $75 Billion each? I don't fault the article for this, but it is telling that the main point of the article is aimed squarely at this dishonest frame of discourse.
To play a little devil's advocate...
Without turning our military into mercenaries for hire there isn't really a way to make them budget neutral, same goes for intel as we'd have to sell what we gather while spying. LEO budgets are, even if indirectly, supported by ticketing/fines and quotas are illegal.
While public service programs don't have to be cost neutral, if they're capable of doing so there's little reason for them not to be as close to it as possible if not outright profitable. The massive debt and deficit we already have doesn't need any reason to expand further.
Good lord, I agree, I do not wish for the military or the police to be "profitable." It's just interesting how this one area of public spending, specifically social safety-net programs, are burdened with a standard that is not applied for any other form of public spending.
Well, there's two reasons why they should do deficit spending on education. First is that education has positive externalities.
When a citizen is educated by a public university, the government does not just collect their tuition money. That citizen is now more efficient. He is a skilled worker, and can earn higher wages and produce more stuff, which then returns to the government by taxes.
Because of that, being cost neutral... may not actually be cost neutral.
Additionally, it's not necessarily a linear thing, and economies of scale mean that often, it makes a ton of sense to spend money, more money than you have, because once you get to that exponential part, even if you're just aiming for cost neutrality you reach a much "higher" distribution of education if you first give a push with some deficit spending.