In my latest column for The Daily, I offer (a) a cautionary note on what the White House is really offering on tax expenditures (I have a different take from my friend and former boss David Brooks) and (b) I use federal higher education spending as a paradigm for how we should think about retooling the federal budget, drawing on the provocative work of Vance Fried of Oklahoma State.
A couple of quick notes:
(1) I wish I had written about unemployment, as I’ve been thinking a lot about the subject, but the timing — with the release of the job numbers coming after I filed — was awkward.
(2) I didn’t do as good a job as I might have of explaining Fried’s framework. Fortunately, I see that the great Adrian Wooldridge, who goes by Schumpeter, wrote on Fried in this week’s issue of The Economist:
This insatiable appetite for money was bad enough during the boom years. It is truly irritating now that middle-class incomes are stagnant and students are struggling to find good jobs. Hence a flurry of new thinking about higher education. Are universities inevitably expensive? Vance Fried, of Oklahoma State University, recently conducted a fascinating thought experiment, backed up by detailed calculations. Is it possible to provide a first-class undergraduate education for $6,700 a year rather than the $25,900 charged by public research universities or the $51,500 charged by their private peers? He concluded that it is.
Mr Fried shunned easy solutions. He insisted that students should live in residential colleges, just as they do at Harvard and Yale. He did not suggest getting rid of football stadiums (which usually pay for themselves) or scrimping on bed-and-board.
His cost-cutting strategies were as follows. First, separate the funding of teaching and research. Research is a public good, he reasoned, but there is no reason why undergraduates should pay for it. Second, increase the student-teacher ratio. Business and law schools achieve good results with big classes. Why not other colleges? Mr Fried thinks that universities will be able to mix some small classes with big ones even if they have fewer teachers. Third, eliminate or consolidate programmes that attract few students. Fourth, puncture administrative bloat. The cost of administration per student soared by 61% in real terms between 1993 and 2007. Private research universities spend $7,000 a year per student on “administrative support”: not only deans and department heads but also psychologists, counsellors, human-resources implementation managers and so on. That is more than the entire cost of educating a student under Mr Fried’s scheme.
But really, Fried’s insight regarding federal spending is that something like “Superpells” — larger subsidies attached to poor students — should be coupled with the elimination of most direct subsidies to higher ed institutions, to oversimplify the arguments he makes in a recent Cato report.
(3) Apropos of nothing, I am temporarily in California and I love it here. I was on a very delayed flight yesterday, which deprived me of a few hours of sun, but it is humbling and inspiring to think that this journey would have once taken many arduous months, much of it through treacherous, unforgiving terrain. So thanks to the pioneers — who traveled by raft from Polynesia, who crossed Beringia, who crossed the Atlantic, who laid the tracks, who built the airplanes, who deregulated the airlines, who put WiFi on the airplanes — for making it happen. I salute you.