Bernie Sanders free college plan: Make Wall Street pay for higher education.

Bernie Sanders Wants to Make College Tuition Free. Here’s Why We Should Take Him Seriously.

Bernie Sanders Wants to Make College Tuition Free. Here’s Why We Should Take Him Seriously.

A blog about business and economics.
May 19 2015 2:41 PM

Bernie Sanders Wants to Make College Tuition Free. Here’s Why We Should Take Him Seriously.

Bernie Sanders, gunning for the Facebook vote.

Photo by Win McNamee/Getty Images

A couple of years ago, I wrote an article joking that the United States would never eliminate tuition at our public colleges unless Bernie Sanders "somehow leads a Latin American-style coup down Pennsylvania Avenue." Today, I feel the tiniest bit prescient. The socialist senator from Vermont and long-shot Democratic candidate for president just announced that he would introduce a bill designed to make state schools tuition-free for all, in part by passing a tax on financial transactions, including stock, bond, and derivatives trades. So, if he ever does get around to that government overthrow, we now know where the future of higher education lies.

Jordan Weissmann Jordan Weissmann

Jordan Weissmann is Slate’s senior business and economics correspondent.

Taxing Wall Street to give students a free ride through school is an idea that, like most of what Sanders does, will play well on Facebook and poorly in Washington. But setting political reality aside, the senator is offering a very rational framework for how we theoretically could make higher ed more affordable, even if we chose a different way to pay for it. According to the National Center for Education Statistics, public colleges take in a bit under $70 billion worth of tuition and fees annually. Under the Sanders proposal, those schools would be required to stop charging students, and Washington would provide two-thirds of the lost revenue directly, bringing the federal tab to $47 billion at first. The rest would come from states, which would be obligated to maintain a certain level of funding for their higher-ed systems. As enrollment grew over time, the cost would too. 


In some ways, this looks much like President Obama's own plan to make community colleges tuition-free, which also called on the federal government and states to cooperate to cover the cost of educating students. It's an extremely sensible approach that tries to deal with the root problems that have driven up the cost of an education over the decades. Public college tuition has risen because of a mix of state budget cuts and uncontrolled spending by the school administrations. The federal government has tried to compensate by offering tax breaks, grants, and low-interest loans to students. But that has simply allowed states to cut more and institutions to raise their prices without worrying that enrollment might crash. Instead of trying to play catch-up by handing more and more money to undergrads, Obama and now Sanders would try to force the federal government and states to work in concert, imposing some order on this unwieldy system we've created.

You can argue about whether we should be really nixing tuition altogether, rather than just making it cheaper, given how much more money college graduates ultimately earn in their careers. But it's hard to argue with bringing a little coherence to the way taxpayers subsidize higher ed.

There are other good things about the Sanders bill. For instance, it recognizes that tuition isn't the only thing driving students into debt. It asks schools to preserve their financial aid budgets, and leaves the Pell Grant program for lower-income students in place to help with the cost of books and living expenses.

There are also some problems with it. For instance, even with his proposal's big price tag, Sanders' plan might not actually provide enough money to accomplish all of the things he wants it to. The $70 billion figure the senator bases his funding scheme on doesn't include the financial aid that schools currently give to students. Since the legislation forces schools to eliminate tuition entirely, while using those aid dollars to help students cover things like rent and textbooks, institutions would probably be left with a budget hole. The proposal also meddles a great deal in how schools are managed, with mandates on everything from enrollment to how institutions can pay administrators to limits on the use of adjunct faculty.

And, of course, the bill is expensive and would be paid for entirely through new taxes, where instead lawmakers could try to find money in the current higher-ed budget that right now isn't being spent very smartly. For instance, the tens of billions of dollars worth of tax breaks Washington offers families to help pay for college disproportionately benefit upper-income households and do little to encourage young people to pursue a higher degree. That money could probably be better spent on a program more like Sanders'.

Still, it would be nice if Sanders' bill were treated seriously. The man wants to refund our public college infrastructure, which has been decimated in many states since the recession. And he's found a way of doing it that, fundamentally, isn't all that different from an idea put forth by the current president. Sure, he might be a fringe candidate, but this shouldn't be a fringe idea.