Opinion

The Case for Free Post-Secondary Tuition

Student debt hurts everyone's bottom line. Why we should heed new demands from Quebec.

By Crawford Kilian 29 Sep 2012 | TheTyee.ca

Crawford Kilian is a contributing editor of The Tyee.

Quebec students, having helped put ex-premier Jean Charest out of office over the issue of tuition increases, have now raised the ante: They want entirely free post-secondary education.

This may seem like a scandalous idea, an indulgence for young people from middle- and upper-class families who form the majority of post-secondary students. Surely they can afford tuition, or at least borrow money against their future earnings. Otherwise, working-class Canadian taxpayers, whose kids rarely get beyond Grade 12, will be footing the bill for such students.

Scandalous or not, it's more than a good idea. Free tuition would be a far better investment in Canada's future.

College or university was once a choice for a tiny minority of the rich or talented. Everyone else did pretty well with high school graduation or on-the-job training. But as we have seen for the last few decades, a post-secondary piece of paper is the admission ticket to a reasonable career and a living standard something like one's parents'.

In fact, the paper chase has become an arms race, where a bachelor's degree is little better than a lottery ticket because others have already got their master's.

A $15 billion lottery ticket

In Canada, as in the U.S., students have mortgaged their futures just to buy such lottery tickets. Go to the Canadian Federation of Students' website and check the student-debt window: Late in September, it was pushing $15 billion.

That's a burden to everyone, not just the hapless graduates. A debt-free student, even in a low-paying entry-level job, at least has a better chance of renting an apartment, buying household items, and generally creating demand in the economy. Students paying off debt, however, create much less demand, except on their parents' support.

The costs of post-secondary have far outstripped inflation. In 1958, my first year at Columbia University, tuition was $1,100 -- $8,768 in 2012 dollars. But Columbia now charges $45,028 for a year's tuition, over five times what I paid. The university estimates total costs for a year's study (living on campus) at $62,161, plus medical insurance.

Closer to home, the University of British Columbia charges first-year arts students $4,700 for tuition; fees and books bring that up to $7,657. UBC estimates the total cost of a year's study for a Canadian resident living off campus but not at home at $18,229. For an international student in the same program, total costs would be $25,579. Many other programs charge much more.

No doubt such numbers discourage many potential students, or push them into courses at the nearest community college so they can live at home. Too many students hold down part-time jobs when they should be studying. But thousands of students still go into debt for a post-secondary education, knowing that the burden will distort their careers and their personal lives.

Submitting to extortion

The surprise is not that Quebec students resisted Charest's tuition increases, but that students here have accepted what amounts to systematic extortion by the Canadian post-secondary system.

I suspect that this is thanks to a widespread attitude that the benefits of a post-secondary education are personal, not public. If you want the good job and the big bucks, cough up the damn money yourself or forget about it. And shame on you for even asking for a tuition freeze.

Yet Canadians with this attitude toward post-secondary students evidently see nothing wrong with fully subsidized educations in some fields.

According to the Department of National Defence, the 2012-13 military budget includes $1,184,910,000 for recruitment plus basic and occupational training for 16,441 military personnel and 503 civilians. That works out to $69,930 per person -- which makes Columbia University look like a bargain.

Much of this money will be spent on civilian campuses: the Canadian Forces Reserve Officer Training Program covers university education, free tuition, books, etc. plus salary & benefits; in return, graduates must provide just 36 to 48 months' service. A similar program does the same for noncommissioned officer training in colleges.

Much military training is long and expensive. In 2006, the Auditor General expressed concern about the number of specialists who were leaving the Forces early, and thereby reducing the Forces' return on investment:

"In some occupations, the loss of personnel early in their service can be costly if members leave before the Department can benefit from its investment in training. We looked at the departmental data for a sample of 20 military occupations and found that, after only seven years, most had lost over one third of the group that they had recruited and trained.

"For example, while the military occupation of Army combat engineer has an average attrition rate of about six per cent, the rate of early-career attrition in this occupation is higher. National Defence data show that, by the end of their fourth year in the military, about 35 per cent will have left. The Department estimates that it costs about $220,000 to train a combat engineer up to the fourth year of service.

"Army electrical and mechanical engineering officers have an average attrition rate of about six per cent. It costs about $200,000 to train these engineering officers for the first seven years, four years of which are typically spent in university. However, after seven years of service, about 35 per cent will have left the military. This group typically accepts only around 35 recruits each year; this means that after seven years, only 22 officers are left from the initial group.

"Other military occupations have higher early-career attrition rates and higher training costs. About 71 per cent of military physicians leave within 10 years of joining the Canadian Forces, during which time the Department has subsidized their education for about five years. Two in five military nurses leave by the time they have completed seven years of service."

We can expect training for flying and maintaining the F-35 will be excitingly costly as well, but the pilots and technicians will pay nothing for their tuition.

Of course a case can be made that this is important spending to defend the country and its interests. But it produces no wealth; it simply redistributes wealth generated elsewhere in the economy. It is the equivalent of what a forestry company or car factory spends on plant security.

To pay for the guards and CCTV systems, the rest of us have to invest our own money to go into business as highly taxable wealth producers. This seems like a misplaced priority. Surely a country should first encourage activity that will generate wealth worth protecting. Otherwise, defence spending amounts to a protection racket.

When we know that educated citizens in general earn more and pay more in taxes, it's reasonable to make education as accessible as possible. If real wealth emerges from high education levels, support for education at all levels should be our first priority -- from kindergarten to grad school.

This is especially true in our present demographic transition, when fewer workers are supporting more seniors and children than ever before. An unproductive worker is a clear and present danger to us all. Yet we expect our young people to mortgage their lives to rescue the rest of us.

No free lunch

Decades of right-wing propaganda have got us into this fix: There is no such thing as society, you're on your own, every tax is a burden and personal insult -- which implies that there is indeed a free lunch, and you should get what you haven't paid for.

Not all countries are locked into this thumb-sucking attitude. Sweden in effect offers Canadian Forces educational subsidies to everyone -- including the foreign students that we regard as bipedal cash cows.

A report from the Stockholm Institute for Scandinavian Law describes a staggeringly rational approach to post-secondary tuition and expenses:

"For undergraduate students tuition is free in Sweden. ... Students applying for a university education are accepted on merits. The merits are either high school grades or the results in a national university aptitude test. The universities are paid by the government both according to the number of students registered for its courses and on the credits taken by its students each year up to a certain limit decided by the government for each university. If the university does not meet the requirements it has to pay back money to the government. On the other hand if it exceeds the limit it will not be paid for the surplus. It could be said therefore that there are tuition fees but that they are paid by the government and also regulated by the government. They vary based upon the subject. The university receives much less for students of the humanities, law and social sciences than for students of technology, medicine and the natural sciences.

"In Sweden only doctoral students are regarded as graduate students. Tuition is free for them, too. They have to apply and be accepted to be able to pursue doctoral studies."

What's more, financial aid isn't taxable, and the loan component can be paid off over 25 years. And students have to meet educational standards to get into the system and stay in it. The report also noted that:

"One argument for tuition fees often heard is that higher education enables some people to earn higher incomes. Seen from the point of view of the individual he or she makes an investment in education which will reap rewards in the future. There are, however, not many fields in Sweden today where the income differences are that big. If this argument is to be true the wage differentials have to increase substantially. If there are wage differentials the fees will be recovered by the government as our income tax system is progressive. Education is thus profitable from a government point of view."

In other words, the more you learn the more you earn, and the more you're taxed. So you enjoy a good lunch but you pay for it, and your fellow citizens have a reasonable chance to do equally well through the education you've helped to finance.

When developed countries like Sweden understand that their real interest lies in a highly educated people, we need to compare our policies to theirs and see if we're following our own interest.

One statistic may be useful: per-capita income in Sweden in 2011, in U.S. dollars, was $56,956 -- number eight in the world. In Canada, we were number nine, but our per-capita income was almost 12 per cent less, at $50,436.

That, as they say, is the bottom line.  [Tyee]

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