Sunday, April 30, 2006

Tuition Hikes

I am puzzled as to why I keep coming across the following rather stupid argument for hiking tuition fees in Canada. The argument goes something like this. There is a wide income gap between people with university degrees and those without degrees. Clearly, obtaining a university degree leads to better things and given that gap seems to be ever widening, having a degree will probably be even more valuable in the future than it is now. That being the case, it is only right that those that who benefit from obtaining a degree pay more towards what it costs to educate them.

Now, leaving aside the problems associated with drawing a causal relation from a correlation, problems associated with projecting data well into the future and whole host of other missing caveats, let us just assume that they have hit the nail on the head. Obtaining a university degree is well worth it.

Does it follow from this that the only way of having students give back to society is by having them pay higher tuition fees? Of course, it does not. As a population, those with degrees earn more than the rest of the population and so pay more taxes. Once more, the way the system is currently set up the more you benefit from your degree the more you pay.

I dare say, the tax route is a much more attractive option for other reasons too. People are not burdened with the expense of having to pay for their education at a time when they can least afford it (when they first step into the working world), but will instead be able to pay for it at a time that they can most afford it. What is more, this way the person that benefits from the having a degree is more likely to assume more of the financial burden. After all, in many cases a student’s family fits all or part of the cost associated with obtaining a degree.

The real beauty of this argument, though, is that it can be employed against those who object to tax option on the grounds that a degree holder pays the same tax rate as a non degree holder in the same tax bracket. Tongue firmly in cheek, simply agree that, alas, this is true. Despite the fact past graduates had their education supplemented by tax payers to a much larger degree then is the case now, university graduates pay no more than non degree holders in the same tax bracket. Having said so, ask the following question: If current students, who have yet to benefit from their education, should be made to pay for a larger chunk of what it costs to educate them, should those who are currently benefiting from having a degree also be made to pay retroactively for a greater chunk of what it cost to educate them?

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