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Clinton’s free-tuition plan threatens private colleges

Justin Haskins

Hillary Clinton has her heart set on fundamentally transforming higher education in the United States. Just three weeks ago, in her Democratic National Convention speech, Clinton pledged to work with former rival Bernie Sanders “to make college tuition-free for the middle class and debt-free for all.”

In an August 11 speech in suburban Detroit, Clinton reiterated the importance of providing low-income and middle-income Americans with the opportunity to attain a college education without debt.

There’s no questioning whether the nation’s higher education system is in need of reform. From 1993 to 2015, the average combined cost of a full-time undergraduate attending four-year colleges rose (in inflation-adjusted dollars) from $8,758 to $25,409, an increase of 190 percent.

Total U.S. student loan debt now surpasses $1.26 trillion, and according to the Federal Reserve Bank of New York, average monthly student loan payments for borrowers aged 20 to 30 is $351. The average college graduate owes more than $37,000 in student loan debt, and there’s no indication cost increases are slowing.

The chief component to Clinton’s plan to resolve the growing student debt crisis is to make public colleges tuition-free for most students and to eliminate tuition at all community colleges. According to Clinton’s campaign website, under her plan, “By 2021, families with income up to $125,000 will pay no tuition at in-state four-year public colleges and universities. And from the beginning, every student from a family making $85,000 a year or less will be able to go to an in-state four-year public college or university without paying tuition.”

Clinton says her proposal will be paid for “by limiting certain tax expenditures for high-income taxpayers” and by requiring states “to step up and invest in higher education.”

The massive government investment in higher education that could occur under Hillary Clinton’s administration would likely be a boon to many public colleges across the country and for most community colleges as well, but what about the 1,600 private higher education institutions? If public colleges are tuition-free for most students, how can private schools compete?

While Clinton’s plan likely won’t threaten elite schools such as Princeton or Harvard, it would give a tremendous advantage to public colleges and likely drive many smaller high-quality private institutions out of business.

Free-market, pro-liberty policies—such as providing significant tax incentives to businesses and individuals who establish need-based scholarship programs and ending various unnecessary and burdensome student lending restrictions—should be pursued instead.

Justin Haskins is executive editor of The Heartland Institute. This has been adapted from InsideSources.