Hard to sympathize with higher ed budget ballad

In Capitol Review by Mark Hillman

The spending lobby at the State Capitol is shameless in its clamoring for higher taxes on Colorado’s families and businesses.  The latest chorus of woe comes from the ivory tower of academia.

Colorado’s public four-year institutions enroll some 175,000 students and employee about 25,000 staff.  Yet during the past seven years, these same schools have added nearly as many employees (3,537) as students (3,664).  That’s right: enrollment grew by just 2% but the number of employees increased by 17% during a period of supposed budget austerity.

Lumping K-12 schools into the same complaint merely employs the tired tactic of using school children as a ploy to bolster spending elsewhere.  Arguments that K-12 schools are shortchanged carry far more weight than cries of poverty from denizens of the ivory tower who supplement taxpayer funds with students’ tuition.

Consider some key figures measuring growth in Colorado’s economy and state budget since 2010:

  • Population, up 10%.
  • Personal income, up 33%.
  • General fund spending, up 49%.
  • Total state spending, up 35%.
  • K-12 general fund spending, up just 16%.
  • Higher education general fund, up 103%; total spending, up 55%.

(In fairness, 2010 was a particularly lean year for higher education; using 2009 as a baseline, general fund support still grew by 32% — twice as much as K-12.)

Anyone truly concerned about funding for priorities like education, transportation or public safety must confront the elephant in the living room: runaway spending on health and human services (HHS).

Medicaid was initiated to provide health care benefits to the most vulnerable and needy, but Colorado lawmakers have expanded the program to include benefits for nearly 300,000 childless, able-bodied adults.

Since 2010, HHS spending growth has consumed more than 70% of all new general fund expenditures which puts funding for all other budget items in a vice.  While HHS has grown from 27% of the general fund to 40%; K-12 and higher ed have been reduced from 54% to 47%.

The HHS squeeze is a mathematical fact.  Had K-12’s share of the general fund remained constant, our elementary and secondary schools would receive an additional $443 million – without raising taxes.

Unfortunately, academics seem more interest in soaking taxpayers than in budget reform.  Higher education earns its ivory tower reputation because of its isolation from the real world.  Since 1978, college tuition costs have grown at nearly twice the rate of inflation and have risen far faster than the price of new homes or even the cost of medical care.

University of Colorado law professor Paul Campos wrote in the New York Times: “Far from being caused by funding cuts, the astonishing rise in college tuition correlates closely with a huge increase in public subsidies for higher education.  If over the past three decades car prices had gone up as fast as tuition, the average new car would cost more than $80,000.”

Why should taxpayers believe that more government spending will lower costs for students?  Colleges have reacted to expansion of Pell Grants and greater access to federal loans by hiking tuition to capture those subsidies.

Our public high schools are routinely evaluated based on the percentage of graduates who attend college, implying that college is a necessity for most students.  Yet more than half of college graduates under age 25 are either underemployed or work in jobs that do not require a college degree.

It’s one thing to ask taxpayers to subsidize programs – like medicine, engineering, physics or education – that benefit society at large.  But why should Colorado families or businesses subsidize the myriad “vanity degrees” that produce few employable skills?

This column originally appeared in the Denver Business journal as a point-counterpoint on education spending.