In this paper, Bob Meister conducts an in-depth look at the public university situation in the US at the moment considering its major issues and the conditions that led to the current situation. The exploration is conducted with a special emphasis on California State as it provides a perfect historical overview of the education system as it changed from a model system to the where it is currently.
Privatization is the Problem, Not the Solution
There has been a consensus that taxpayer funding for colleges has reduced and therefore it is “unrealistic” for the universities to depend on state funding as this relies ultimately on the taxes. Therefore, privatization is offered as a solution to the issue of increasing educational institutions revenues. However, Meister highlights that the ability of the colleges to spend increasingly is reliant on their capacity to charge more. The system in a long-term tuition bubble; this is especially important considering the privatization was never intended as a model of making college private, rather it was a policy of expanding universities that were leveraging the state's willingness to fund increased students by having the students pay more.
Education as Both a Private and a Public Good
While higher education current system involves higher prices to students to save them from growing income inequality, traditionally the model involved educational attainment being correlated to economic development, growth and consequently reduced economic inequality. The model of an “inverted U” correlating growth and income dispersion can be seen in the California Post was a boom in the 1950s and 1960s. This section argues that in California when the public bore the cost of the University education, the situation was manageable with students paying lesser fees; it benefited both the public with a reduced economic inequality and the private student with the better career option. A public and private good, that the current model of privatization where students pay significant sums of money for fees but with reduced career opportunities.
Privatization as Financialization
The privatization of education has been criticized for turning education into a commodity or a consumer good as opposed to a public good. Meister argues that in addition to the commodification of higher education privatization is also the financialization of the growing income gaps. The fear of falling behind income inequality forces the students from middle-income backgrounds to borrow more for college fees. This means that they will spend the next 15-25 years of their life paying compound interests to their student’s loans as opposed to pension plans and even investments. Therefore, the income gap widens as can be evidenced by California surprising and rapid increase in the revenues of the top 20% and the bottom 80% in the economy.
The Federal Government Subsidizing Privatization
It is counter-intuitive that hat the Universities keep assuming that they will obtain more revenue despite the fact that the income protection that they are selling is unlikely to grow. However, they are exploiting the fact that the Federal government that guarantees the loans leverages the entire system of higher education. This makes the system recession proof to the extent of occasionally boosting the stock of some for-profit companies that own universities. Nevertheless, it is apparent that in the absence of the Federal government provided student loans the universities could not have conceivably raised their tuition by more than 59% while the median family income rose only by 2 percent.
Articulation of the link between Debt Burdens and Tax Burdens
The income gaps that were generated by the rapid growth and development of Silicon Valley provided the UC an opportunity to revise its tuition policies, but the opportunity passed. The governor of California, Jerry Brown sought to stop a plan by UC by reading the 2010 November rise as a reimbursement of the state’s investment in UC. However, this did not lead to any changes as the university still treats its tuition revenue as “private” in a similar manner to bond markets. Milton concludes in this section with a push for increased taxes to provide higher education as a publicly funded good that is independent of individual access to credit.
Works Cited
Meister, Bob. "Debts and Taxes: Can the Financial Industry Save Public Uniersities?" The Humanities and the Crisis of The Public University (2011): 128-155. Online. <http://ucscfa.org/wp-content/uploads/2011/11/07_Meister.pdf>.
