This commentary originally appeared in Forbes on January 19, 2016.
Some argue that federalism—the distribution of powers and duties between the states and the federal government, as codified in the U.S. Constitution’s Tenth Amendment—is dead. Regarding higher education, they may have a point: The federal government has been encroaching in this sphere since at least post-WWII, with Washington’s big push occurring in the ‘60s, as part of LBJ’s “Great Society” agenda.
What has resulted from federal intervention into higher education—into an area that the Constitution left to the states, not Washington? The wisdom of America’s Founders in placing education with the states is shown by observing what federal policy has wrought: Over the past quarter-century, average college tuitions have jumped 440 percent—four times the increase in the C.P.I. and twice that of healthcare costs over this period. Student-loan debt is at an all-time high of $1.3 trillion, surpassing total national credit-card debt. Moreover, record numbers of recent college graduates are either unemployed or underemployed (have jobs that don’t require the sheepskin they paid/borrowed so much to attain).
In short, American higher education is in a crunch. The demise of federalism has contributed to this dilemma. Education analysts Fred Hess and Andrew Kelly argue that defenders of the higher-education status quo “suffer from severe bouts of Finland and Singapore envy.” By this they mean that those championing an ever-larger role for Washington in higher education forget that other countries with similar top-down control “have populations of 5 million or so, or about the population of Maryland or Massachusetts.” Attempting to “make rules for schools in a nation that’s as large and diverse as the U.S. is simply a different challenge.”
We see this cleft between authority and accountability operating, venomously, in all fifty states. For several years now, defenders of the status quo have blamed state legislatures for not funding as high a percentage of public college and university budgets as in decades past. This critique ignores the role federally funded student loans have played in this crisis.
Paul Campos, about whom I have written here, has examined state funding for higher education. He finds that tuition inflation is not caused by “funding cuts” but instead “correlates closely with a huge increase in public subsidies for higher education.” He grants that state dollars appropriated per student are less than they were “at their peak in 1990.” But he also shows that “appropriations per student are much higher than they were in the 1960s and 1970s, when tuition was a small fraction of what it is today.” In fact, “by 1980, state funding for higher education had increased a mind-boggling 390 percent in real terms over the previous twenty years.” But did this “tsunami of public money” help reduce tuition? No. “Quite the contrary.”
The preceding data suggest that federal policy has sown acrimony between public universities and state legislatures. What can states do to satisfy these schools? Not much—the states are becomingly increasingly cash-strapped and, unlike Washington, must balance their budgets annually.
The solution? Every effort must be made to return as much power and money as possible to the states. This is no small task, especially given the apparently widespread notion that federalism is dead. But we must start somewhere, and now, because no democracy can long endure the decoupling of accountability from power.
Nor can higher-education’s business model long survive without innovation, which will be implemented sooner if we open up higher-education reform to the genius found in our federalism-provided, fifty laboratories of democracy. Washington’s bureaucratic leviathan smothers newborn ideas. If we hope to enhance affordability and accountability in higher education, it is time to turn away from an intellectually exhausted federal approach and return to the states the powers granted them under the Constitution.