Bad Public Policy Idea of the Day

By Bryan O'Keefe

As states continue to grapple with the problem of rising college tuition at public universities, many well-intentioned state legislators come up with ideas on how to solve the problem. Unfortunately, some of these ideas are not wise in the least bit. Case in point: A recent proposal from a state legislator in Pennsylvania that would essentially change Pennsylvania sales tax law and give the additional revenue to Penn State. (Pennsylvania tax law note: several classes of items in Pennsylvania are exempt from the sales tax; this proposal would end some of those exemptions)

I know a thing or two about Pennsylvania and higher education, having originally grown up in the Pittsburgh area. Penn State has outrageously high tuition for a state university – I remember when you figured in all of the costs, going to school in Happy Valley was not that much cheaper than some private schools. This proposal seems to recognize that problem, but, instead of trying to give Penn State an incentive to cut some of their costs, it instead taxes everyone else to pay for Penn State tuition. Why should senior citizens and middle class families who have absolutely no connection to Penn State whatsoever subsidize it even more through the sales tax? And what is the guarantee that Penn State will not continue to raise tuition even with this new funding? The news stories that I have read seem to imply that the money will be given to Penn State and not students.
Finally, what about other state schools? Pennsylvania has a rather confusing system of publicly funded higher education that extends well-beyond Penn State. Why should PSU get preferential treatment over these schools?

While I object to the sales tax idea in the first place, if you are going to do something like this, maybe the money should be given directly to students in the form of a voucher. Make state universities compete for the students and let the students decide if Penn State really is the best public university in PA. Of course, this idea is not even on the table.

The only good news is that this dismal proposal has little chance of actually passing this year. Let’s hope that it stays that way in the future.