Good & bad arguments for tuition fees
The debate about tuition fees corroborates one of my prejudices - that in popular political debate, the arguments that are used are often weaker than the arguments that are not. What I mean is that three arguments for higher fees are just nonsense:1. “The nation can’t afford it.” But if taxpayers as a whole cannot afford to fund university tuition, then a subset of taxpayers can’t afford it either, especially as they will be paying higher interest rates than taxpayers generally.2. “It’s unfair that students are subsidised by worse-off people who don’t go to university.” However, insofar as going to university raises your earnings, you pay back the cost through ordinary taxation. Someone who earns 20% more than median earnings will pay back the £27,000 cost of tuition within around 16 years. And those for whom the graduate premium is larger - very much larger in some cases - in effect subsidize those for whom it is smaller. 3. “Tuition fees will create a stronger market in universities, which will raise standards.” Charlie and Stefan are right - this is “manifest nonsense”. One overlooked reason for this is that where markets do raise standards, they do so not so much by increasing the quality of incumbent organizations, but by killing off inefficient ones and permitting more efficient firms to enter. But it’s unlikely that this mechanism can work in higher education. There are humungous barriers to entry; would prospective students really want to stake their careers on an institution with no track record? And I suspect that, insofar as colleges or departments would close, the decision would be based upon political rather than academic or even commercial factors.However, just because these arguments are weak, it does not follow that there are no good arguments for higher fees. Here are three:1. They are a backdoor tax on the rich. Insofar as graduates are richer than non-graduates, tuition fees are simply higher taxes on the well-off. Better still, insofar as being a graduate is correlated with having higher ability, tuition fees come close to being an optimal tax - something which raises revenue without reducing labour supply. 2. In deterring people from worse-off backgrounds from going to university, tuition fees will reduce social mobility. I say this is an argument for them because social mobility is not obviously a good thing. As Michael Young pointed out, it leads to a grasping ambition which undermines social equality and community spirit. And even the tiny handful who are upwardly mobile don’t necessarily benefit. The dirty truth is that, for many working class kids, getting into university is a poisoned chalice. And even if such kids do well at university and become economically successful, they do so at huge cost in terms of isolation.3. Fees might encourage the (re)creation of demand for trainees straight from school. This would increase youngsters’ options, and reverse the qualifications inflation we’ve had in recent years.This argument, however, is a little inconsistent with (1) and (2). I’m not sure if these three arguments are strong enough to overcome the intergenerational injustice of tuition fees. But they are, I suspect, stronger than the more widely-used ones.