Should the Government Subsidize Higher Education - Essay Example

Should the Government Subsidize Higher Education? In the contemporary America the price for education is very high, thus not all of the who are potentially capable of becoming qualified specialists can allow paying for it. This it is logical that the government has to give the opportunity for the talented youth from the poor families to get the higher education. But the economists nowadays question the fact whether subsidizing higher education pays off. This paper is the analysis of the economic benefits of the government subsidizing higher education for some of the citizens who cannot allow it. The social policy of the U.S is that all the citizens have to be given equal opportunities. In the same time its obvious that the capable youngsters to whom the higher education will give the opportunity to become the qualified specialists are born in low-income families also. In case those youngsters are given the opportunity to get the higher education, the productivity of their labor will increase, and the government will benefit greatly. Unfortunately in the present moment the subsidizing higher education program is not very effective, as the aid is not always given to those students who really need it, and it is often spent not rationally. For to increase the effectiveness of this program, it would be wise to change the system of selection of the candidates for this aid, for to ensure that people who get it really cant pay for their education for themselves. John & Noell (1989) wrote that all types of financial aid have been shown to have a positive influence on college enrollment, regardless of the students race or ethnicity. For the students that grow up in the low-income families, governmental financial aid is the only way to get the degree, and the chance to enhance their social status. Thus today government aid is the only thing that helps the low-income youngsters get the degree. Nowadays government subsidizes higher education in different ways. The non-returnable aid, such as grants and scholarships, are need-based aid and merit-based aid. Need based aid is the type of financial help when the student is given financial aid because he needs it for to pay for education, considering his financial situation and the level of income. Merit-based aid is the aid provided for the students who score well in studying or community service; it mostly depends on the academic achievement. The problem with this kind of aid is that those are usually the students from the high- and middle-income families who get it, thus it turns out that the low-income families have to pay more for the education of their children than the high-income households.( OBrien, C., & Shedd, J, 2001). Some students get grants for to pay for their higher education, but the grant money is usually not enough to cover all the expenditures. (How Minority Students Finance Their Higher Education. ERIC Digest., 2001) The statistics shows that the low-income families do not get the benefits they should get from the government financial aid. Adolph Reed, Jr., and Sharon Szymanski write that "Today, families with incomes up to $25,000 can be asked to pay as much as 71 percent of their earnings to send a son or daughter to a public four-year college; families whose incomes range from $43,000 to $66,000 pay from 17 to 19 percent. Yet families with incomes over $99,000 pay only 5 to 6 percent of their income." The second and the most popular way to finance higher education for the low-income families nowadays are Federal Student Loans. The statistic says that in recent years 54% percent of total aid was given in loans. The problem with loans is that there are often not enough of them for to pay for the skyrocketing tuition cots, thus the students have to borrow more and more money. (Baum, S., & Saunders, D, 1998) Considering the fact that low-income families comprise a great part of the American population, and that nowadays only 44% of youngsters who grow up in those families get the higher education, this sphere really needs government subsidizing. Today the low-income families live in some kind of a cycle, when the parents are unable to provide decent education to their descendants, and so their kids level of income is almost never higher than that of their parents. These people dont have a hope to make their lives better, thus the quantity and quality of their labor worsens. In case youngsters from the low-income families are given chance to get a degree, they get a possibility to enhance their social status. This is the realization of American dream, whichs that a man can reach desired social and economical status if he puts enough labor and effort. The American social paradigm is based on the belief that every citizen has equal opportunities in our country, and subsidizing higher education for those who cannot allow paying for it is one of the vital elements of providing equal opportunities to everyone. Educated specialists are those who create the future of the country, people that will form the future of the state. Thus it is logical for the government to try to provide higher education to those who will be able to make the best use of it. The effect of government subsidizing of higher education on peoples behavior is apparent. Those, who were sure they dont have any chances of getting the degree, get the opportunity to increase their value on the labor market, and some of those people use this opportunity. The labor supply of qualified workers increases, as the amount of those who have the degree increases. The governments need in the qualified professionals gets satisfied, thus all the taxpayers benefit, as they get all the needed goods and services for the reasonable prices. As the level of unemployment for the college graduates is twice lower than for those who graduated only from high school, the level of unemployment is also dropping gradually. Government subsidizing of the higher education also influences the savings of the citizens. The fact that higher education is sometimes sponsored by the government makes people hope that they wont have to pay for their degrees. Thus it sometimes happens that the family of the future student doesnt save the money for his/her education, hoping that he/she will get financial help from the government. The possibility of getting the governmental aid for education makes people put a lot of efforts for to acquire it, and sometimes the efforts of the parents and students are put for to prove that their family is poor enough for to get the financial aid instead of finding the decent loan or earning money for to pay the costs of education. Merit-based aid opens the possibility for all the layers of the society to diminish their educational investments. In our society getting the merit-based aid is considered to be prestigious, thus even the students who dont really need it, apply for to get it, sometimes leaving those who cannot pay for their education behind. But, in the same time, the fact that academic excellence sometimes lowers the price one has to pay to get a degree makes the students from other social layers study hard, thus the quality of the workforce the government gets after the students graduate enhances. Government subsidizing of the higher education leads to the increase of supply of the qualified workforce on the market, thus the prices the employers pay for their work decrease, and their demands to the qualification of the employees, in its turn, become higher. The competition on the market becomes greater as the amount of specialist in a specific area increases. This policy improves the efficiency of the labor force, as it is known that a person with a college diploma is more qualified, adaptive and teachable than the person who has the high school diploma. Moreover, its often said that college actually teaches people how to learn, thus the college graduates have much more potential for further development and deepening of their knowledge than the possessors of the high school diplomas. People who have higher education are able to distribute their time and resources more rationally, thus the effectiveness of their labor is increased. It is also that they are taught to use the variety of methods for solving this or that problem instead of concentrating on one method. Higher education gives its recipients the basic knowledge in different spheres of social and cultural science, thus presenting them a massive of additional information that is often helpful in their future job. It is also that higher education doesnt give the answers to all the questions, and doesnt give the methods for to solve all of the appearing problems, instead it teaches its recipient where and how the needed information can be attained and how it should be used. It is also that government subsidizing of higher education gives opportunities to obtain financial and social status to those who wouldnt have managed to earn it otherwise. Its a proven fact that people with a degree earn more than those who dont have it, thus higher education is the only way to wealthy life for most of the American citizens. The fact that the youngsters from the low-income families also have the access to higher education responds to the principle of equity that exists in the American society. The system of subsidizing of the higher education in the U.S should be changed for to open the access to education to those who are really unable to finance by themselves, instead of lowering the college expenditures for those who can already allow paying for it. The amount of merit-based aid should be decreased for to increase the expenditures for the need-based aid. It is also that the financial aid should be rather given in the form of grants instead of making students take the loans they later have great difficulties repaying. As you see the subsidization of higher education is a controversial issue in a modern U.S society. Its obvious that the government should give the low-income students the opportunity to get the degree in case they long for it, as it enhances the productivity of labor, increases labor supply and corresponds to the principle of equity existing in our society. The existing system of subsidizing does not corresponds to the needs of the low income students, as it rather gives the opportunity to the more wealthy students to decrease their expenditures on education. Works Cited 1. Amaury, N. How Minority Students Finance Their Higher Education. ERIC Digest. ERIC Clearinghouse on Urban Education New York NY, 2001. Retrieved December 2 , 2005 < http://www.ericdigests.org/2002-3/finance.htm > 2. Baum, S., & Saunders, D. (1998). Life after debt: Results of the national student loan survey. Braintree, MA: Nellie Mae. 3. OBrien, C., & Shedd, J. (2001). Getting through college: Voices of low-income and minority students in New England. Washington, DC: Institute for Higher Education Policy. 4. Reed, A. Szymanski, S. Free Higher Education. Academe, 2004 5. St. John, E.P., & Noell, J. (1989, December). The effects of student financial aid on access to higher education: An analysis of progress with special consideration of minority enrollment. Research in Higher Education, 30(6), 563-581 Read More