<p>Higherlead and emeraldkity4,</p>
<p>Lets talk microeconomics for a second, please: </p>
<p>Lets presume that all colleges are now treated like public colleges, not private colleges and that the government sets the price and covers the cost for all students. What do you think is likely to happen? Greater equality of educational opportunity leading to improved educational levels? Poor students getting better skills and training, while the level for the top students remaining consistent?</p>
<p>Economics says the following will happen:
Those owning the private colleges will have no incentive to improve the college or the level of education the school provides, since the need to attract students in a competitive manner no longer exists. The demand for the better schools will decrease while the demand for the worse schools increases, since the demand is now set by the government. However, the way to increase profits at all the schools will be to cut costs, since the supply is also set by governmental decree. This means that demand is inelasticsimilar to gasoline. </p>
<p>But availability is limitedwe all know that. Today only 28% of students go on to get a 4-year degree and only 50% of students go to college. Now 100% of students will be guaranteed college, so supply will be constrained. In an effort to allocate the supply, the education provided will need to be allocated alsokind of like the way gasoline was allocated back in the 1970syou could get gas on even numbered days if you had an even numbered license plate, and odd numbered days for an odd license plate, and the price was fixed at below-market rates to benefit the poor. The result: total chaoslong lines at every station, stations running out of gas before they could service everybody (since with a unrealistically low price demand exceeded supply), fights breaking out over shortages, and people illegally siphoning gas out of neighbors cars to be able to get to work. </p>
<p>In education, the only way to siphon the demand will be to temporarily limit everybody to going to school only about half the year, while siphoning the talent to provide the education on a year-round basis from other areas. The government will artificially increase the supply of education by increasing the pay to teachers at the cost of limiting the supply of people going into other areas. This will lead to a temporary shortage of talent in other areas, causing their costs to increase as they bid for the shortage of workers, and will cause some businesses to fail. The increased costs will be passed back to consumersmeaning the cost of many basics (such as food, housing, and transportation will go up considerably). This cost will lead to massive inflation, and inconvenience the elderly whose social security will now be unable to cover their daily needs. It will also drive up the cost of goods produced in the US relative to other global economies. Thus the trade balance will increase, thus lowering the balance of trade payments and increase the consumer cost of living. This, in turn, will lead to a lower standard of living in the US compared to what it was prior to this policy action.</p>
<p>And all of this was just because someone wanted to do something that appears to be helpful. The problem is that as the Economics book my son uses in his microeconomics class says: good intentions do not guarantee desirable outcomes.</p>