Doubling down on stupid in the ivory tower….

Amid all of Øbama’s recent student loan rate histrionics in an attempt to buy the votes of college audiences and Jimmy Fallon, I came across this gem of a story on college tuition increases which was briefly mentioned on the WTIC news yesterday.

It was a report on the news regarding differential increases in tuition for college students.  To wit, the Provost of the University of Maryland has asked the Board of Regents to consider charging some science and engineering majors a premium, purportedly “to allow the university to accept more students in those fields.”  Yes, educating students in these majors is more expensive than say, an economics major, with laboratory sections and their attendant equipment and consumables, but there are already extra lab fees associated with these types of courses to offset these costs.  This would be a tuition hike in addition to these fees, because fees, like taxes, never go away.

The real reason for differential tuition was stipulated by college administrators: the graduates of these fields have the potential to make more money.  So now college administrators are predicting the future and tapping their student’s potential earnings?  Additionally, is this not a tacit admission that these institutions are also producing graduates with worthless majors that don’t have decent earning potential after four or more years of college?  It is currently being reported in the news that one in two graduates of the class of 2011 and soon, 20112, are unemployed, so the logical question becomes: will future graduate victims of differential tuition get compensatory tuition refunds from their alma mater if they don’t get a high paying job?   Conversely, if a graduate from a major that is not predicted to be lucrative happens to fall into a job that pays well, will his/her alma mater have the right to charge them a premium ex post facto?  An interesting can of worms, no?

According to the referenced survey of differential tuition by the Cornell Higher Education Research Institute, academic institutions have been doing this or something like it since the late 80’s and early 90’s, and it has been increasing rapidly to include about 40% of surveyed institutions as the idea caught on.  Doubtlessly this technique for “squeezing blood from a stone” will continue and spread to the remaining institutions, fed by politically motivated increases in “free” or government subsidized Øbama tuition money from the government.  Given the rate of increase for college tuition, at an average of 8% per year (about double the inflation rate), tuition effectively doubles every nine years.  How can colleges justify these additional arbitrary rate increases in light of the fact that college tuitions are already rapidly outstripping the ability of an average family’s ability to pay?  You don’t need a Ph.D to see that as students will shop for majors from institutional tuition “smorgasbord” menus in much the same way they will shop for colleges, i.e. based on affordability, and as a result, more students than ever will be discouraged from entering the hard sciences and other majors now deemed to be more potentially lucrative than others.  Will this drive more impoverished students into the lower paying soft sciences, like sociology and gender studies, fields that are more suited to supplying the entitlement industry of government with (by their own admission) lower paid workers?

The original article states “The proposal also stipulates that a portion of the extra revenue be set aside to support students who cannot afford the premium.”  Ah, yes, income redistribution rears its ugly head again.  Not only will these students be subject to liberal income redistribution schemes when they graduate, but now the college liberal elites are forcing more well heeled students to subsidize the “less fortunate”.  I guess they will have to learn sooner or later!

We already have alarmingly insufficient numbers of young Americans applying to the STEM (Science Technology Engineering Mathematics) majors because they are, in a word, difficult.  Why add a financial burden that will surely turn away even more worthy students already looking at huge student loan bills after college?  Why use cost as an excuse to push students into majors that admittedly won’t provide them with well paying jobs, instead handing the well paying STEM jobs and the technology that comes from them to foreigners?  Why dissuade students with plenty of aptitude but not a lot of money from pursuing careers in STEM majors?  Here’s an idea: charge the premium to the students that want to waltz through college in utterly useless majors like gender studies, music appreciation and many of the soft sciences!  Use the potentially non productive for your cash cows!  Reward the STEM students for making good choices, not the students making bad choices.  At least the STEM students will be in a better position to be tapped for alumni donations!

Another aspect of this problem is that American students are being displaced (or replaced) in the country’s graduate schools by foreign students.  As a member of the hard science academic community, I can tell you from personal experience that graduate classes are filled with foreign students, particularly Chinese (and increasingly, South Asian Indians), and it is getting worse.  The idea of differential tuition will simply exacerbate the problem.  Are these schools just “taking the money and running”, while feeding the problems created by the big brain and technology drain to the Far East?  Is there an analogous proposal being made to charge these foreign students an extra premium for taking their learned expertise back home to China or elsewhere?

When you look at this, think about why liberals in academia and the media, who reflexively try to pin the “hate science” donkey tail on Republicans, are trying to keep students from taking STEM courses?  It looks to me like the “hate science” donkey tail rightfully belongs on the liberal asses that propose this sort of epic, long term stupidity.  What better way to kill our country’s technological advantage than by dissuading citizens from taking STEM courses, and filling them with foreign students that will go home after college?

Is this inability to think through the long term effects of these proposals by colleges and universities indicative of the quality of education our students are receiving?  If so, then we are really getting shortchanged on these tuition hikes.  Much like the liberals in government, their only solution is to raise tuition and fees rather than cutting extraneous costs.

Note to these schools: alumni have long memories.

5,552 people become statistically invisible in Connecticut

We’ve got mail. Most people probably do not realize how state and federal unemployment figures are put together. Of course, we need to compare apples to apples when looking at historical figures, but when you’re unemployed and politicians are claiming things are getting better, it can be a hard pill to swallow.

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More bad news about Obamacare

Jim and I discussed this on the show this morning and we thought you might like to read the full article.  A recent study by James Sherk of the Herritage Foundation has disclosed that Obamacare will cause unemployment and underemployment of low wage, low skill workers to rise. Read more

Minimum wage not working so well for minority youths

The American people are being sold a bill of goods – lied to – concerning the effects of a minimum wage. Federal and state minimum wage mandates do nothing to help provide a “living wage” nor does it do anything to improve the overall employment picture. Walter E. Williams’ column today discusses how this government interference ensures about one in four minority youths are unemployed.

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Jobs, not food stamps: The 60 Minutes report that drove the show UPDATE: Hot Air kudos to CBS

It really is worth watching because it outlines beautifully (umm, pardon the adjective) the problem facing 14 million Americans. Relying on food stamps, unemployment checks, and neighbor kindness to stay afloat in an economy that clearly is not recovering, merely treading water. Read more

Unemployment still at 9.6% – Private sector adds 64,000 jobs

The September 2010 figures are out, and the summer of recovery has proven to be a dud. Of course, Reuters used the word “unexpected” twice in the first sentence of the first paragraph, and within a few minutes it looks like some editor dropped the words.

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Prof Goolsbee to America: Umm, no, unemployment not coming down anytime soon

Well, there’s a shock. The new economist in chief at the White House, Austan Goolsbee tells ABC’s This Week, don’t look for unemployment to fall. Actually he also wouldn’t make any predictions about how many jobs the President’s new stimulus would create? In fact, he pretty much didn’t say much except, well, trust me, this time it’s gunna work. Nice. Read more

Unemployment Rises … 9.6%

There is some good news  in this month’s report, but only if your first and last name is Pollyanna. Heh.

The Labor Department reports that the private sector added 67,000 jobs in July which according to reports is better than … expected? Or better than nothing. You choose. Read more

In United States, 17% work for the government

From a new Gallup poll, we find that 1.7 of 10 American workers work for the government. That figure includes all local, state and federal workers, but unfortunately the survey does not break down the job function (military,teachers, fire, police…).

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Economic stimulus…a far better idea

Last week, Speaker of the House Nancy Pelosi (D. Ca.) told us, with a straight face, no less, that unemployment benefits create jobs.  Anyone who frequents this blog knows that her comments make absolutely no sense.  But, in a marvelous article in Thursday’s Wall Street Journal, Arthur Laffer explains not only why Ms. Pelosi’s statement is completely wrong, but also explains, in basic English, what the Obama administration should have done.

First, there is absolutely no economic stimulus from unemployment benefits.  And, long term, it may actually harm economic growth.  To demonstrate this, Mr. Laffer asks you to imagine an economy with only 2 workers, one of whom is employed, and one of whom is unemployed, and receiving unemployment benefits.

From whom do you think the unemployment benefits are taken?  The other person obviously.  While the one person who is unemployed may ‘buy’ more as a result of unemployment benefits, the other person from whom the unemployment sums are taken will ‘buy’ less.  There is no stimulus for the economy.

Well, you may say, that example makes no sense because the money isn’t simultaneously taken out of the pocket of the employed, and, put in the pocket of the unemployed.  But, the psychological impact is the same.  The employed person knows that his taxes will have to rise to pay for the cost of the unemployment benefits, so, he spends less in order to be able to pay for the increased taxes down the road.

Let me add that I do not believe that we should have no unemployment benefits.  But, Ms. Pelosi seems to believe the benefits should be extended indefinitely because they will create jobs.  They will not.  At best, we are only holding our own.

A better way…

Mr. Laffer tells us that between 2007 and now, we have spent $3.6 trillion (between Stimulus Part I, Stimulus Part II, the parts of the 2009 budget Bush vetoed, (aka, the Porkapalooza), and assorted other unemployment benefits extension bills, presumably to save or stimulate the economy. 

Instead of spending that $3.6 trillion, Mr. Laffer says:

My suggestion would have been to take all $3.6 trillion and declare a federal tax holiday for 18 months. No income tax, no corporate profits tax, no capital gains tax, no estate tax, no payroll tax (FICA) either employee or employer, no Medicare or Medicaid taxes, no federal excise taxes, no tariffs, no federal taxes at all, which would have reduced federal revenues by $2.4 trillion annually. Can you imagine where employment would be today? 

Sounds like Reagan, doesn’t he?  Maybe now, you understand “Reaganomics”, and why lowering taxes, not increasing government spending, is the only way to truly stimulate the economy.