Problems with subsidizing higher ed

Geoffrey Lawrence

I came across an old article from the Foundation for Economic Education this morning addressing the problems with taxpayer subsidies for higher education. That’s right, I said problems.

You see, in a world of limited resources, the over-consumption of one product due to a government-created distortion means shortages of other goods and services. Moreover, heavy subsidies for higher ed are detrimental to the higher ed system itself. Subsidies create artificially high demand while insulating consumers from the direct costs of consumption. While some pundits claim that subsidies are necessary to combat the rising cost of a college education, any worthy economist would quickly point out that government subsidies are the reason for rapidly increasing costs. They also tend to lower the quality and utility of educational pursuits.

My favorite line from the article: “Another form of waste is the pursuit of irrelevance. Insulated from the discipline of the marketplace in their taxpayer-supported fiefdoms, many academics pursue silly scholastic dogmas.”

I’ve highlighted some of these points in the past with regard to funding of the NSHE system. The Freedom Budget also proposed a major restructuring of the way the system is funded. I’m sure that NPRI’s Education Policy Analyst, Patrick Gibbons, could add a diatribe of his own on this topic.

Geoffrey Lawrence

Geoffrey Lawrence

Director of Research

Geoffrey Lawrence is director of research at Nevada Policy.

Lawrence has broad experience as a financial executive in the public and private sectors and as a think tank analyst. Lawrence has been Chief Financial Officer of several growth-stage and publicly traded manufacturing companies and managed all financial reporting, internal control, and external compliance efforts with regulatory agencies including the U.S. Securities and Exchange Commission.  Lawrence has also served as the senior appointee to the Nevada State Controller’s Office, where he oversaw the state’s external financial reporting, covering nearly $10 billion in annual transactions. During each year of Lawrence’s tenure, the state received the Certificate of Achievement for Excellence in Financial Reporting Award from the Government Finance Officers’ Association.

From 2008 to 2014, Lawrence was director of research and legislative affairs at Nevada Policy and helped the institute develop its platform of ideas to advance and defend a free society.  Lawrence has also written for the Cato Institute and the Heritage Foundation, with particular expertise in state budgets and labor economics.  He was delighted at the opportunity to return to Nevada Policy in 2022 while concurrently serving as research director at the Reason Foundation.

Lawrence holds an M.A. in international economics from American University in Washington, D.C., an M.S. and a B.S. in accounting from Western Governors University, and a B.A. in international relations from the University of North Carolina at Pembroke.  He lives in Las Vegas with his beautiful wife, Jenna, and their two kids, Carson Hayek and Sage Aynne.