By Richard Vedder
I read in today's Washington Post that Congress is going to do something novel in 2007 --meet on a regular basis. Instead of meeting 3 days a week for maybe 25-30 weeks a year, the new energized House leadership is talking of actually having Monday sessions!!! And shorter "recesses"!!! I appreciate their enthusiastic display of work effort, but worry about the consequences for the nation. My guess is this passion for work may dissipate by next summer. There are a lot of higher ed issues on the burner --the reauthorization of the Higher Education Act for one--so in principle Congress should meet more. But since the net effect of modern federal involvement in higher education is arguably more negative than positive, I am actually sorry to read the news. To me a do nothing Congress on average is better than an activist one. Having said that, however, I suspect "gridlock" in the form of divided government on the whole is better for the nation than uniform single party rule. Competition in government, like competition in business, is better than monopoly.
The affable and astute George Leef of the Pope Center, a key ally in our fight for better and more affordable higher education, has brought to my attention two marvelous blogs by Gary Becker and Richard Posner. Becker is a Nobel laureate economist of great sagacity, and Judge Posner combines superb economic thinking with great accomplishments in the legal profession.
Becker and I recently (a few months ago) had a civil disagreement about his belief that higher education has a high rate of return to society, and his view that higher ed has all sorts of positive externalities or spillover effects (e.g., more healthy populations). This has made Becker more sympathetic to the Democratic announced efforts to expand student financial aid than I am. But Becker is intelligent, and thinks that the current loan system is not optimal. He shares my belief that moving to an "equity" approach to federal assistance and away from a traditional fixed rate loan approach is desirable (although I would prefer for the feds to exit the loan business altogether). The equity approach deals with the argument that current high costs and big student debts are threatening the nation with major shortages of lower paying professional workers, such as teachers and social workers.
Posner shares more my skepticism on the positive spillover effects of higher education, and does not like the massive expansion of federal student aid that Speaker-designate Pelosi and others are espousing. He makes the point that the primary benefits of university education accrue to the students, and even if there are some positive external benefits, it does not necessarily follow that, at the margin, an expansion of loan and grant programs serves society well. Both gentlemen are first-rate scholars and their views should be accorded great respect.