"The poor subsidising the rich"

[Tubby Isaacs]

http://www.guardian.co.uk/education/2009/dec/27/wealthy-university-students-pay-more

can someone explain this bizarre notion to me? The rich (quite rightly) pay a very large proportion of total tax. Just because they receive some of that back from higher education and poorer people don't doesn't seem to be even a tenuous argument for massive fees for universities. Make them pay more via income tax rather than some complex system of variable fees.

By this logic, public money went towards buying the Titian painting last year. Painting is disproportionately a middle class interest. The rich are subsidised by the poor.

It's absurd.

[Guy Profumo]

"The poor subsidising the rich"

Tubby Isaacs wrote:

http://www.guardian.co.uk/education/2009/dec/27/wealthy-university-students-pay-more

can someone explain this bizarre notion to me? The rich (quite rightly) pay a very large proportion of total tax. Just because they receive some of that back from higher education and poorer people don't doesn't seem to be even a tenuous argument for massive fees for universities. Make them pay more via income tax rather than some complex system of variable fees.

By this logic, public money went towards buying the Titian painting last year. Painting is disproportionately a middle class interest. The rich are subsidised by the poor.

It's absurd.

Why do fools fall in love?

[Max Payne]

"The poor subsidising the rich"

"In the US, higher education is seen as an investment. Here it is seen as a right. "

Investment. The fucking word of the Noughties.

[Anton Gramscescu]

"The poor subsidising the rich"

Tubby,

"The poor subsidising the rich" is indeed a bit of a shit rationalisation. In part because where higher education is concerned, there is some cross-generational stuff involved: people who come from rich families don't always end up rich after graduation and people from poor backgrounds sometimes end up quite rich. And so it's not always clear who is being subsidized and why.

But let me put it another way: why would you spend scarce public resources paying students from wealthy backgrounds to do what they were going to do anyway? Why would you pass up having wealthier parents voluntarily throwing money into public entities such as universities?

An efficient system of post-secondary financing will put money in sufficient to pay for the positive externalities of education (of which there are many), leverage whatever private resources it can, and ensure that subsidies are targetted in such a way that no one sees finances as a barrier. Given the gaps in the levels of cultural capital and academic preparation between rich and poor, this means having different levels of net tuition (i.e. tuition minus grants) for people from different income backgrounds.

[Anton Gramscescu]

"The poor subsidising the rich"

Interesting that it's Blanchflower making that argument, btw. He's had a column in the NS for the last six months where's he taken a strong line that the Bank Of England staff have been massively incompetent throughout the crisis and arguing strongly in favour of much more aggressive public spending to combat the downturn.

[DCI Harry Batt]

"The poor subsidising the rich"

The poor subsidise the rich in everything in our society, of course. If you were in the least bit serious about finding this a problem and wanting to do something about it, you wouldn't start here.

[Tubby Isaacs]

"The poor subsidising the rich"

TonTon, well put.

AG, it just seems to be shifting the costs below/above some accounting line. Is there some reason why a charge plus taxing brings in more money than trying to do that all by taxing.

You got any (non-subscriberable) links to Blanchflower's stuff?

[Anton Gramscescu]

"The poor subsidising the rich"

From an institutional point of view, it's quite definitely not about accounting lines - it's about having multiple sources of revenue, which is a source of security in bad times.

I don't think I can definitively answer the question about whether it brings in more resources. Norway and Sweden are able and prepared to fund very rich higher education systems entirely out of tax dollars - they spend between 2 and 2.5 percent of gdp on it each. Elsewhere in Europe, it's rare to find governments spending much more than 1% of GDP on higher ed. (I think the UK is slightly over 1%, but not much more). Among these countries, those that charge fees do substantially better than those that do not. The US spends about 1.5%, and then adds another 1.5% to that through private funding (mostly but not entirely tuition), which tells you something about the total funding gap between the US and Europe.

An archive of Blanchflower's articles for the NS is here.

[E10 Rifle]

"The poor subsidising the rich"

I think you need to start from the premise of TonTon's first sentence really. But anyway, if there are going to be super-fees for courses, then the incentive for universities will surely be to make sure that their absolute priority will be to get the rich, £30,000-payers in on their courses, in big numbers, and fuck the proles, and fuck standards. THe big universities need the money after all - they keep telling us that. That's capitalism, innit,

[Anton Gramscescu]

"The poor subsidising the rich"

That's a nice sound bite, but it's an utter misrepresentation of institutional motives.

Universities are non-profit entities. Unlike corporations, they are not profit-maximisers and they don't seek to obtain higher market share. What they are primarily after is prestige, which is gained through a) having staff that are renowned for their ability to make scientific discoveries and b) having the best graduate and undergraduate students. You do not achieve either of these goals simply by enrolling rich idiots.

Harvard and Yale (to take the classic examples) could charge several times what they currently do and still fill their seats. But they don't, because they feel such a policy would reduce the quality of the undergraduates they would attract. And far from being profit maximisers, both ensure that they provide education free of charge to poor and middle-class students (the threshold for free education is 120K/year at one and 90K at the other, but I forget which is which).

There are some good reasons to oppose a move to fees of this magnitude. A decline in standards and "That's capitalism, innit" aren't among them.

[Reed John]

"The poor subsidising the rich"

Yeah, universities are non-profits and don't operate like corporations. They have a culture and institutional neuroses of their own.

In addition to prestige, what appears to motivate university presidents and development people is an insatiable desire to raise money to build shit - new buildings, new labs, new libraries, new sports facilities and, if possible, entirely new schools and departments. To do that requires large wads of cash. And as I understand it, tuition isn't where the real money is anyway. The big money comes from two places - rich donors - usually alumni - and research funds from corporations and the government. At most of the prestigious private universities and the big state schools, the research money has become a bigger source of money than tuition or donations.

Presidents and other people who raise money for universities want to raise money and build shit so they can show the trustees all the money they've raised and shit they've built and then the trustees will agree to give them a raise, and if they don't, then that individual can find another school that will be impressed with their track record of raising money and building shit and pay them to raise money and build shit for them. So to some extent there is a financial motivation, but the sort of people who are successful at raising money for higher education could probably make more money in other fields if they were really motivated by just money.

There are a number of keys to attracting donor dollars. Obviously, it helps if one's alumni are rich, so it behooves the school to attract a certain number of students who come in rich and connected. Its also nice if they can graduate a certain number into lucrative fields like business and electrical engineering.*

They also want to as many alumni as possible to have a warm fuzzy feeling about their alma mater, so that they continue to give money and say good things about the school to prospective students.

This is one reason why having an alum, especially a generous one, as a relative will help one get accepted into that school. It's also why collegiate sports are taken so seriously at a lot of universities. They bring alums (and others) to the campus and, hopefully, reinforce happy memories of the alum's time there.

Getting research funding is a whole other game that AG knows a lot about. That's another case of spending money to make money. You pay higher salaries and build better facilities to get the more famous faculty, who in turn can attract more research dollars. Money can also buy nicer gear for scientists to do their research.

*(A have a friend who teaches at Hampshire College, which is a bit of a hippy college, for lack of a better term. Most of the students aspire to be writers, artists, dreamers, hobos, etc. - admirable aspirations, to be sure, but not generally lucrative.)

[Tubby Isaacs]

"The poor subsidising the rich"

E10, I'm assuming the model would be that everyone would be charged £30,000, but would pay some point on a sliding scale of this, with the balance being reclaimed from the government. So there's no direct disincentive to take only rich there, is there? I still prefer the taxation method though, and if it can be done in Scandinavia, it can be done here.

I don't know about capitalism, but there will be a certain amount of choosing universities in other countries. A brain drain isn't to anyone's advantage.

Btw I find it odd that people will argue that the BBC has to be funded by a charge to maintain its indpendence, but that universities have to be funded by taxation to maintain theirs.

[Anton Gramscescu]

"The poor subsidising the rich"

My guess is that everyone would pay the nominal charge but that offsetting grants would be available to students on a sliding scale, with the poorest receiving a 100% offsetting grant (as is currently the case).

(edit: Tubbs, this may be what you meant, just with an extra step attached - with the money flowing through the student, rather than going firectly from government to institution).

It's certainly theoretically possible to go the Scandinavian route, but I'm not sure it's ever been done before. That is to say, once a state decides what percent of GDP it's going to dedicated to higher education, it's very rare that this changes very much up or down. With the possible exception of Spain (where they were starting from a much lower base), I can't think of a single case in Europe where funding for higher education has ever doubled as a percentage of GDP, even briefly.

[Tubby Isaacs]

"The poor subsidising the rich"

That was what I was trying to say, thanks.

It's a relatively small proportion of GDP, isn't it? It isn't like pensions or anything.

Good observations by Reed, which kind of bears out E10's quip- there's a lot of willywaving to attract students in a capitalist way. Quite how to respond to that, I don't know. It's natural to want to study under the best teachers with the best equipment. If we lose (say) hundreds of medical students to the USA, then they probably won't come and work in the NHS.

Braindrains are a real problem for the proper left, I think.

[Banana Banana]

"The poor subsidising the rich"

I would also say that the most prestigious UK universities function not by attracting the best minds, but as acting as a key gateway for the upper ecehlons of the class system.

Their complete inability to expand access beyond the already priviliged is testament to the fact that their primary purpose is not to teach the best minds. Even basic targets on expanding the number of state school pupils fail. Never mind the fact that the state school pupils they do attract are extremely middle class on the whole.

[Tubby Isaacs]

"The poor subsidising the rich"

I got a newsletter from my old college's master saying "we're already doing what the government says we should, but obviously we can only interview people with three As predicted, and what is a fair admissions policy anyway?"

[Reed John]

"The poor subsidising the rich"

I would also say that the most prestigious UK universities function not by attracting the best minds, but as acting as a key gateway for the upper ecehlons of the class system.

If it's anything like the USA, then I imagine that the universities really don't have nearly as much impact on class mobility as is generally suspected, because the sorting out has happened long before students are old enough to attend university.

Every university in this country, at least, wants to be able to offer scholarships to poor smart kids, but they're very hard to find. Poor people, for a variety of reasons, rarely get the opportunities in primary school and high school to develop and demonstrate their academic potential.

Its very hard for a kid who has not been pushed to a high standard in high school to suddenly step it up in college. They just haven't developed the study skills and/or they simply don't have as much knowledge piled up in their head as their peers. I met a few kids like that at William and Mary. Kids from really rural parts of Virginia where the high schools don't offer much in the way of college prep level courses or encourage kids to go to college. Often they were obviously bright and motivated, but struggled to keep up because they'd never been properly taught how to read, write and think critically.

It works the other way too. When I was a grad student at Boston Univeristy, I met a number of undergrads who didn't have much passion or apparent aptitude for academic or intellectual pursuits, but they could manage to skate by with B's in even relatively difficult courses because they had a decent education drilled into them foribly at fancy private schools or public schools in wealthy neighborhoods.

[Anton Gramscescu]

"The poor subsidising the rich"

As long as a) universities are rationing places based on academic results in secondary schools and b) you have relatively unequal academic outcomes coming out of secondary schools, then Reed is absolutely right.

But other outcomes are possible. Places like Canada and Scandinavia have much lower class disparities in academic results than do the UK or the US. It's why we tend to have more equal access to higher ed than either of those countries, even though we have very different funding systems (ours looks quite a bit like the US, Scandinavia's is nearly 100% state-funded).

Chirpy and Tubby's master are both right, btw. They just have different perspectives on what constitutes a "best mind".

[Tubby Isaacs]

"The poor subsidising the rich"

I thought my alma mater's new master was being a dick. The obvious thing would be to consider some people with the odd B predicted from schools where nobody gets predicted better than that. A guaranteed interview scheme, as we used to call them, with a chance to assess potential for the college. I think if they actually saw a broader range of people, then plenty of fellows would be keen to take them.

[Anton Gramscescu]

"The poor subsidising the rich"

Does your alma mater actually interview everyone who goes there before they get in?

[Reed John]

"The poor subsidising the rich"

Many colleges in the US recommend that you do an interview. I did it with people at the admissions office. It was as much about them selling the school to prospective applicants than vice-versa. Schools want as many applicants as they can get, both so they can get good students and so they can reject more people and make their school more selective.

Some of the posh schools have prospects interview with alumni volunteers that live in their area. I never did that, but my understanding is that that's a terrible system. I have some friends who did that when applying to Georgetown, Yale, Harvard, Brown, Stanford or Princeton and they all said that the person who interviewed them was a whackjob with a political agenda and the whole experience was extremely negative.

) universities are rationing places based on academic results in secondary schools and b) you have relatively unequal academic outcomes coming out of secondary schools,

How else do universities handle more applicants than places if not based on secondary results?

What I'm driving at is that the issue is much more about B and a lot less about A. In a lot of cases, it's not even a question of the school being selective. For example, the CUNY system used to just let anyone with a high school diploma a place. Not everyone graduated, of course, but it used to be a great portal for kids from any background to get their foot in the door of higher ed and from their they could work hard and go anywhere. Lots of great success stories from schools like that.

But now, CUNY has had to install some entrance requirements because too many kids were coming to them simply unprepared for college. Their high school experience was so lousy that the CUNYs were ending up teaching students what they should have learned in high school. If they don't maintain some admission standards they'll either graduate nobody or cease to be a real university. Meanwhile, some other system has to be set up for bridging the gap between the failing public schools and higher ed.

I'd be interested to know how Canada - or any country - achieves more equal secondary school outcomes. I don't see how it can just be about money because from what I can tell, beyond a certain threshold of basic school funding (which, to be sure, some districts struggle to reach) most of the factors that predict poor results for a school or a particular student aren't directly related to school funding at all. Success in school depends on a variety of factors in family, the neighborhood, the attitude toward education of the parents, etc. Canada has communities with a lot of the same problems as communities in the US - drugs, unemployment, etc, etc.

[Anton Gramscescu]

"The poor subsidising the rich"

The CUNY example is the kind of thing I was thinking of in terms of not rationing by grades. Most community colleges have that kind of open access system, too.

I mean, the thing is that there are something like a half million students taking A-levels each year in the UK. Institutions have to find some way to discriminate between them when accepting students for purely bureaucratic reasons if nothing else - no college wants to have to interview anything like that many students. A-level grades (or predicted ones, anyway) are a handy way of doing so, because they imply demonstrated mastery in particular subjects, which is seen as being more objective that the kinds of "potental" metrics that Tubby's scheme implies. (This is not to diss Tubby's idea - just to explain the obvious bureaucratic resistance to it).

Canada's success at creating more equal secondary school outcomes is almost entirely accidental since we have no serious policy discussions on the subject. My impression is that of the Scandinavian countries, the Finns have their shit together on educational policy more than the others.

I think it comes down to four factors:

1) Relatively flat economic outcomes. Countries with extremes of wealth and poverty are going to have large numbers of people who start with large advantages and disadvantages in terms of "readiness to learn". Over the long run, ceteris paribus, that will play itself out as an inequality of educational outcomes, too.

2) Relatively equal per capita funding of schools. The US system of funding schools through local taxation is abut the worst imaginable because of the way it accentuates economic disparity.

3) Either high ethnic homogeneity *or* a society which is relatively permeable to newcomers. Germany has terrible problems with inequality despite doing relatively well on the first two measures. Reason: it treats its Turkish residents like shit. (secondary reason - it shortchanges working-class kids, too).

4) School policies which give principals/headmasters concrete goals in terms of achievement and wide latitude on how to achieve it. Overly standardized curricula and overuse of centralized testing, for lack of a better word, suck. Policies which encourage schools and teachers to find their own ways of communicating concepts clearly to students, while holding them accountable for results, are clearly superior (the Japanese, the Finns and the Albertans, in different ways, seem to do well on this point).

The US, I would argue, fails on almost all of these four criterion. Given these failures and handicaps, I'm constantly impressed at how *well* the US does at providing educational opportunity at colleges and universities. By rights, it should be a lot words.

[Banana Banana]

"The poor subsidising the rich"

Everyone going to Oxbridge will have 3 As anyway. They only make offers after interviews to those expected to get 3 As and who do well in the interview.

So inevitably they succeed in filtering in people who fit in better and have the self-confidence given by being brought up as part of a social elite.

They could fill their places with more state school pupils if they took into account how much harder it was for them to get 3 As and if they looked at predicted results.

At postgraduate level Oxbridge is far more egalitarian: probably a lot becuase bright state educated kids with AAB are more likely to get a first three years later - which you will need to get into a DPhil - than someone with AAA from a private school.

[Guest]

"The poor subsidising the rich"

Except that the interview process isn't designed to discriminate in that way, or it isn't supposed to be.

Schools and teachers telling pupils not to bother applying, that it's only for kids from Eton, etc, are just as much to blame.

[Tubby Isaacs]

"The poor subsidising the rich"

Antonio Gramsci wrote:

Does your alma mater actually interview everyone who goes there before they get in?

Yes, no offer of places without an interview.