How Do We Break the Cycle of Higher Tuition and More Debt?

College tuitions continue to rise, and students are leaving school with more and more debt. Professor Daniel Lin argues that there are two main causes for increases in college tuition: a rise in demand for a college education and government subsidies. Problematically, government subsidies are supposed to be helping offset college tuition costs. So what should be done?

Professor Lin argues that we should get rid of government subsidies for higher education completely. While subsidies do encourage more students to attend college, many of those students struggle. Two-thirds of students are unable to graduate in four years, and 40 percent of students drop out of college. Those who never finish a degree tend to have significant debt. In addition, many graduate and take jobs they could have had without a college degree. While the average college graduate does earn more than the average high school graduate, not all college graduates earn higher incomes.

While eliminating government subsidies for higher education may cause demand for higher education to decrease, it does not necessarily mean students who cannot afford college would be at a disadvantage in the job market. Many industrial countries have training and apprenticeship programs for high school graduates to prepare them for successful careers. As it stands, government subsidies are contributing to increasing higher education costs. Such a policy, which is worsening the problem it is supposed to fix, should be eliminated.


  1. fred

    Stop the subsidies!

  2. Brian Phillips

    Trade schools need to be promoted more as a real alternative to college.  Many who go through trade schools go on to own their own businesses and become quite successful.  How did the stigma against blue collar work begin?

  3. Ravensburger3

    I really think that the whole system of college should be rethought. I imagine it as college host courses in subjects that anyone could sign up and pay for that individual class, and employers lists the subjects they believe are required for there employment. This would cause students wasting time taking classes that they will never use. 

    If well rounding is your concern, then if it matters to the employer they would put a list of well rounding subjects. My belief is that employers of engineering do not care if you know about ancient egyptian history or if you took ballroom dance.
  4. Tom Graham

    My firm belief is that the government should provide, for free, web based accredited curriculum that anyone can study in their own time.

    Obviously, there are many careers that require hands on instruction, but the mass majority of classes taught in college today are class room settings and homework.
    Colleges should only teach those things that require hands on experience.
    Basically, the colleges should be there for advanced lab work.
    The online homework should give instruction on how to construct a home lab, and an inspector can come out and approve your lab before any basic or intermediate lab work can be assigned to you.
    Poor people could take the classes at the library.  Maybe this would give the government motivation to invest in an all fiber internet framework to deliver education.
    Cost of constructing the lab should be communicated upfront.
    New paradigm!!!
    Then Colleges could charge as much as they wanted for the advanced lab work, only the advanced people would go to college, and the rest of the country would be massively more educated.
    And we have the technology to do all of this today.
    To me, this is the next moon shot project of the US
  5. Anderson Chaves

    This really makes a lot of sense.

  6. Kenny Legge

    This is really amazing, but we run into the issue of people not wanting to cut programs that are already active. Even if in this scenario it would benefit the whole.

  7. juliansfree

    Let’s save the future. We need to do better for our nation’s youth. Stop the war on youth!

  8. Keith Knight

    Housing bubble of 2008 caused by easy credit from the Fed for real estate, when will the student bubble collapse and give the government an excuse to blame the free market!

  9. Vinay D Cardwell

    Ever since the Bush administration made bankrupting out of student loans illegal in 2006 you have seen the advent of for profit schools and tuition rates increase because everyone in the education system gets paid up front and a person is obligated to pay back that debt even until they die.

  10. Matt Wavle

    So since, subsidies distort market signals, pushing up tuition by artificially increasing demand, exactly HOW do we end subsidies?    Shouldn’t student debt then be included in what can be erased during bankruptcy, so that schools will have to bear part of the responsibility if they don’t provide an actual measurable benefit to their clients?

  11. Matt Wavle

    This is a valid criticism of a particular administration.  Although, don’t be fooled that either one of the two big parties really has our interests at heart.  At the crux of the problem is the mentality that gov’t intervention is a good thing and pouring on more bureaucracy and more regulations can somehow fix a market problem (that ironically, was created by the same “fix”)  Statism is the disease, Freedom is the cure. 

  12. jcrescenzo

    Tom Graham your solution is just horrible.

  13. taschrant

    I think that bubble bursting for higher education is approaching.

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