The “Underpants Gnomes” Theory of Higher-Ed Funding | Eastern North Carolina Now

    Publisher's Note: This post appears here courtesy of The James G. Martin Center. The author of this post is James M. Hohman.

    Step 1: Spend more on universities.

    Step 2: Get more graduates.

    Step 3: Statewide prosperity!

    Sounds pretty simple and straightforward, right? (At least for fans of the very NSFW program South Park.) States with more educated residents tend to have higher incomes. So it seems only natural that investing more taxpayer dollars in higher education should lead to stronger economic growth via more graduates. Indeed, it's a simple proposal often made to state lawmakers by university administrators and their assorted allies.

    If only it were so simple.

    Below is a chart showing taxpayer spending per student, by state, as well as each state's educational attainment. Each dot is a state. So, for instance, the dot at the far right is Hawaii, which spends a high amount on higher education-$21,960 per full-time equivalent student-but is around the middle of the pack for the population of adults with a college degree.

    If the theory worked, then states should be clustered around a line leading from the bottom left to the top right. Such a connection doesn't exist.

    Spending more doesn't lead to states having more educated populations.

    Of course, it shouldn't be surprising that taxpayer funding doesn't result in an educated populace. Lawmakers don't attach a lot of strings to their tax dollars, nor do they do much to reward success.

    If anything, schools use taxpayer funding to supplement what they charge students in tuition. (As the Martin Center recently reported, federal dollars often cause tuition to rise.) The thinking is that supplementing tuition might encourage more people to attend, and perhaps even to graduate.

    However, if students cared about the costs of higher education, there would be a lot more price competition between colleges. Instead, schools tend to compete over other things, like amenities, facilities, and social-justice do-goodery. Sometimes, students and parents do indeed get concerned about tuition costs, and admissions officers are pretty good at alleviating those worries. Loans are available if the out-of-pocket cost of attendance is too high. And the college degree is the perceived ticket to the middle class, so the expense will more than pay for itself.

    Despite the lack of connection between state funding and outcomes, the United States as a whole has become more credentialed. According to the Census Bureau, the percentage of adults with a bachelor's degree increased from 27 percent in 2006 to 35 percent in 2021. But this is unlikely to have been caused by states deciding to spend more taxpayer dollars on universities. The phenomenon has much more to do with credentialing as a de facto employment standard, to name just one probable cause.

    State lawmakers should be much more judicious about how they subsidize higher education. They ought to ensure that taxpayers get something in return for their spending. Finally, they ought not to expect, without evidence, that additional dollars will lead to a richer state population. It doesn't.

    James M. Hohman is the director of fiscal policy at the Mackinac Center for Public Policy.

With the Midterm Elections less than one week away: What do you consider the top issues that you will be voting on to be corrected by your better representation?
  Big Government getting Bigger
  Biden /Democrat controlled Spike in Energy Cost
  Inflation created by Legislation of Majority in Power
  Gender Reassignment
  Corrupted Bureaucratic /Service (DOJ, FBI, etc.) Institutions
  Discredited Legacy Media
  Ending the Corruption of Dishonest Politicians
  Corruptive Influence of Social Media
  Wide Open Southern Border
333 total vote(s)     What's your Opinion?

Go Back

Leave a Guest Comment

Your Name or Alias
Your Email Address ( your email address will not be published)
Enter Your Comment ( no code or urls allowed, text only please )


( November 26th, 2022 @ 8:07 am )
Possibly, the single greatest contributor to the innate problem of giant sectors of people losing their ability to reason, and to outright think, in basic terms, on a continual basis is our failed education system, now known as the failed Education Industry.

Large sums of money thrown at education by unwise politicians has not helped, in fact it has contributed to its demise.

The United States Education Industry must once again become a benefit to our citizenry, and their newfound sense of competition, and fair greater policy from wise politicians will be the only answer.

Leaving the monopolistic Education Industry to their own devices, as a means of their governance, will No longer work ... for this construct has NOT worked for such a long time, and that is well proved.

NC Parents Weigh In on Book Bans, Gender Identity (Part 2) James G. Martin Center for Academic Renewal, Editorials, Op-Ed & Politics Local Government Commission Approves $105 Million Independent Living Project


Latest Op-Ed & Politics

Sources inside Twitter headquarters have confirmed Elon Musk and his team of brilliant engineers have been working tirelessly to get Twitter back to its normal state of allowing Twitter user Catturd to go viral.
U.S. intelligence officials reportedly say that several Chinese spy balloons floated over U.S. soil under former President Donald Trump but “went undetected” at the time and officials only “discovered after” Trump left office that the balloons were Chinese surveillance.
If an academic field gets politicized, consider looking to its professional overseers.
Sen. Ted Cruz (R-TX) is advocating for the quick removal of Department of Homeland Security Secretary Alejandro Mayorkas as the illegal immigration crisis on the southern border shows no signs of slowing down.
The 2023 National Prayer Breakfast came to an abrupt and premature end today due to severe lightning that kept striking the building where the politicians were gathered.
If any three men have been most outspoken in their desire for peace between Ukraine and Russia, it has been former President Donald J. Trump, the Vicar of Christ Pope Francis, and former Secretary of State Henry Kissinger.
This week, U.S. Senator Thom Tillis (R-NC) and his colleagues introduced a bill establishing a bipartisan, bicameral Joint Select Committee on Afghanistan to conduct a full investigation into President Biden’s failed and tragic withdrawal of U.S. forces from Afghanistan.
"This is not about woke-ism or mandates on job creators, it’s an effort to ensure fair and equal access to our financial system no matter your race, party affiliation, or political beliefs," Rep. Patrick McHenry, R-NC, in a statement to Carolina Journal.


Back to Top