Making Education More Expensive
Michael Ignatieff said it, Justin Trudeau sent an email approving of it, Bryan May, my Liberal Party candidate, tweeted it:
If you get the grades, you get to go.

"One! One-Thousand Dollars a year"
The Canadian Learning Passport is the Liberals policy announcement of the day: $4,000 tax free over four years to every high school student who pursues post secondary education, $6,000 for low income earners. That’s $1B a year in students pockets to spend on tuition.
Of course, it’s only $1,000 net if tuition fees don’t increase. Education being a provincial responsibility, the federal government have no say whatsoever on tuition fees. They can throw money at schools, students and books, but they cannot control the cost side of the structure. No problem, I hear you Liberalizing, we’ll work with the provinces.
Yea, well, about that. Here’s the problem. Premier Dad, Dalton McGuinty, has 68% of his budget goes to health and education spending. Of a $113B budget, $77.4B disappears in those two line items. Next up is debt financing (interest on the debt) at $10.3B. There’s no money in the kitty.
Now your Dalton and the Feds just came up with $200M to throw into one of your big 2, your education system. Do you let the kids keep it? Or do you pull $200M from the budgets of the post secondary institutions and let them make it up in tuition?
That’s the problem The Canadian Learning Passport policy has. It will ultimately be, have to be, an indirect transfer payment to the provinces. Once it rolls out, tuition fees will likely go up across the country. It won’t be the students who benefit, or their parents, it will be the schools and the provincial treasuries.
The real problem with education is supply and demand – especially in university. Too many students are going, many who really don’t belong – creating huge demand for the few spaces. That drives the price of those spaces up.
At the other end, of course, too many kids are running around with degrees, to the point where car factories hire university graduates to work on the lines – and those graduates are glad to get those jobs. And it’s not that tuition is so expensive, it’s that jobs coming out of college don’t pay enough to pay off that debt in a reasonable time. Dentists leave school with $100,000 debt, but it is not a crippling debt due to their earnings when they get out. Social work majors may leave school with $25,000 debt, and wonder how they’ll ever pay it off.
Too many students means too expensive going in, not enough payback coming out. And giving kids $1,000 to go is going to push more kids in, raising the cost, lowering the reward.
Good governance is not just throwing money at people and problems, assuming those issues away. Good governance is understanding the direct and indirect impacts your policy will have. The Canadian Learning Passport is the former, with no consideration given to the root of the problem or the result of the spending.
Recent Comments