In-state Tuiton--Subsidy or Social Contract?

This weekend the Washington Post had a provocative column by Fred Hiatt arguing that in-state tuition is basically a subsidy for the rich.

Say what?

Well, as Hiatt sees it, in-state tuition is a subsidy in as much as the state spends about $19,000 per student per semester but only charges him/her $9,400 a semester for tuition.  And, since wealthy kids go to college at much higher rates than their poor and working class peers, this is a "regressive" subsidy.  It helps the rich more than the poor. 

On the face of it, this sounds like a reasonable argument.  Shouldn't the governments be concentrating its subsidies on the people who need them the most?

There are two problems with this line of thinking.  (There are actually quite a few problems, but hey, this is a blog, not a college essay, so I'll spare you).

First, subsidies don't just have to be for poor people.  Subsidies can also be used to build up and support social goods.  Social goods are meant to be 'consumed' by as many people as possible, and as such have an impact across society.  If we adopt the idea that subsidies should only be for the poor, then we'd never have interstate highways, fire departments, police, or any number of services built for and used by the entire populace.   

Second, social goods tend to bind people together from across society at large.  In the realm of education, that means that a subsidized state university becomes something that belongs to all of us--rich and poor, black and white, young and old.  If you don't treat education as a public good, then it becomes just another consumer good--like a television, a car, or even an extended vacation.  Those who can afford to buy it can.  Those that can't, don't. 

Of course, those rich kids in Potomac that Hiatt thinks are getting unnecessary handouts will still be able to afford unsubsidized tuition and will still go to college.  But, those at the bottom of the economic ladder, who may already find the $9,400 tuition hard to pay, will be locked out of the system entirely.  And, that will just be the way it is, because after all, when something becomes a commodity, it isn't something everyone should have, or that benefits us all.  It is just something you buy.   

There's also the unfortunate fact that when you only subsidize the neediest, the better-offs tend to point fingers and make moral judgements.  And, then they'll fight to undo them, on the grounds that the recipients are undeserving.

Hiatt may fancy himself a progressive tax maven, but what he's really doing is regressive.  He's abandoning the notion that there are things government should provide for all of us.  It is an attack, however implicit, on the whole notion of the social contract.

Think I'm exaggerating?  I wish I were.  But, Hiatt shows his hand at the end of his essay when he argues that the in-state tuition 'subsidy' "mirrors" entitlements like "tax deductions for mortgages [and] charitable giving".   

Seriously.  

Take that one in.

Subsidized public education is no different than a middle class tax write off.  

I guess I missed all those inspirational PSAs during Saturday morning cartoons that encouraged me to aim high because a mortgage tax deduction could be in my future.       

p.s. there's nothing stopping the state of Maryland, or universities themselves from providing subsidies to low income students to attend college.  In fact, if universities want to create a more progressive subsidy system, I'd suggest cutting upper level administration salaries (presidents and provosts making over 200k a year) and applying the savings to students in need.