Free Access to Higher Education
Benjamin Franklin once said that investment in knowledge pays the best return. But the escalating cost of college is a major hurdle. Today, student debt exceeds one trillion dollars and as the volume of debt mushrooms, defaults are on the rise. Our student loan program is costly to students and has contributed to the skyrocketing cost of college. Just as easy credit leads to high home prices, easy credit allows students to accept tuition rates that are too high.
With a Payments Tax, we could afford to give students a free college education if we build in the right incentives. Student would need to find a college or vocational school offering a full year’s tuition at a cost of $10,000 or less.
With this qualifier in place, the program would send a powerful message to both students and colleges.
- It would challenge students to choose between taking out loans for a conventionally priced education or choosing a free ride for an efficiently priced education.
- Colleges would thus be incentivized to deliver a year’s education for only $10,000 in order to attract an abundance of students.
Such a program should also encourage shorter-term education programs designed to prepare students for jobs like programming. We need to break the mold on the idea that a four-year liberal arts education is a one-size-fits-all solution and create more cost-efficient programs that prepare students for careers.
There are 24 million college and vocational students in our nation. If every student were to elect this program, the annual bill would be $240 billion. Under our current system of taxing income the program would not be possible. With a Payments Tax, the program would cost someone earning $100,000 per year just $5.