Higher Education Funding

By Greg Harvey, Treasurer

Published in November 20, 2014 issue of The Voice

Let’s state the obvious: college isn’t cheap, and it’s getting more expensive. Total student debt in the United States is at record levels. Truly, something needs to be done. However, before we start offering free, government-paid tuition to all students, let’s review a few reasons for the costs and see if there are any less dramatic approaches we can take.

There are a number of reasons why student debt is exploding. The most major, of course, is rising tuition costs at universities. However, that doesn’t tell the whole story. According to the higher education think-tank Minding the Campus, there are more students than ever attending out-of-state colleges and paying more for their education than in-state students. In addition, as much as 40% of the increases have been from room and board. Collectively, these account for much of the student debt increase.

Right away, there is a simple, though unpopular, solution: more students can stay in-state and commute when possible. Commuting costs half that of living at an in-state institution and a third of living at an out-of-state one. Speaking as a senior who’s commuted my whole career, I can attest that, while commuting isn’t fun, the lower tuition makes up for it. This is a simple solution that requires no government intervention; instead, it depends on students making better choices.

Similarly, the subjects students choose can be just as important as where they attend. According to The Economist, much of college’s ROI depends on one’s major. Those who study technical fields like engineering do much better than those in the arts. It’s just the way it is. Therefore, another easy fix for students to lower bills is to compare the costs and benefits of particular majors before choosing.

Another major reason for increased tuition costs is, not surprisingly, governmental regulation. As Arthur Kirk, Jr., president of Saint Lao University, states, his college has hired a plethora of staff to meet regulatory requirements and spends thousands of hours annually completing federal compliance forms. If we made universities more public, these costs wouldn’t go away; instead, making higher education free would eliminate the incentives colleges have to manage costs.

Now I must address the points in last week’s article. First, forgiving all current student loans is infeasible. There’s over $1 trillion in such debt outstanding; simply writing it off would cause massive losses to the federal government and private lenders. While the idea sounds good, it would be catastrophic in reality.

 Finally, completely subsidizing higher education is impossible in the United States. Think of it this way: the Federal Government runs a massive deficit each year and states struggle to balance their budgets. Governments don’t have a lot of money available to pay for tuitions. Cutting other spending to make room in the budget sounds good, but other programs can’t make money like colleges do. Is it really fair to cut funding for roads or pensions to pay for higher education, when colleges can raise revenue?

Therefore, we’d have to raise taxes, likely on the rich. However, higher earners are more likely to be college graduates. Therefore, raising taxes would actually cause students to pay for their education over a lifetime instead of a defined period. If you run numbers, you’ll find that even small tax increases on the wealthy would cause them to pay vastly more than under a normal student loan. In other words, if we try to make college free, it’ll actually become more expensive for those who succeed.

In conclusion, student debt is a problem, but the solution isn’t massive government reform. Rather, we need to make better choices about the schools we attend and what we study. Will higher education ever be free? No, and it’s pointless to think so. But if each student worked harder at reducing their own college bills, we’d see immediate decreases in personal debt, and it’s the only guaranteed way we can achieve that.

Why You Should Vote for Corbett in Today's Election

By Jake Miller, President

Originally published in October 30, 2014 issue of The Voice.

As the midterm elections creep closer and closer, everyone is either taking a side or brushing it by the wayside.  We here at the College Republicans encourage activism on campus and in the community.  However, we would like to elaborate on some facts about Tom Corbett and his governorship that have been disputed or otherwise ignored.

Running against the incumbent Republican governor is York County native Tom Wolf.  Wolf has a very diverse background, working in the furniture industry, while also acquiring his PhD from MIT.  He took over as the Chief Revenue Officer (tax collector) under former governor Ed Rendell in 2006.  Rendell was a master at raising taxes, and leave it to Wolf to learn from the best.  According to multiple sources including the Pittsburgh Post-Gazette and the Pittsburgh Tribune-Review, Wolf will only release his proposal on how he plans to raise the state income tax if he is elected next month.  What kind of strategy is that?  Also, according to the Commonwealth Foundation, Wolf plans to increase state education funding by $4.6 billion.  To do that however, the state income tax would have to be nearly tripled.

Another one of Corbett's strong points throughout his term as governor has been the job growth around the state of Pennsylvania.  most of that job growth is a product of fracking and breaking Marcellus Shale.  According to CBS Pittsburgh, since drilling took off in Pennsylvania five years ago, 45,000 new jobs have been created just in the gas industry alone.  One point that is often used against Corbett is that in 2011 after the recession, he dropped Pennsylvania from 7th to 49th in the category of job creation.  What people who use that claim are failing to realize is that Pennsylvania recovered form the recession faster and stronger than most states.  In 2010, before the recession, Pennsylvania had seen 83,500 jobs added.  From March 2010 on into March 2011, 09,300 jobs were added.  In March 2011 alone, PA ranked sixth with 55,200 new jobs.

Ultimately, one of Corbett's critics' age old arguments is his educational spending record.  The claims are endless that Corbett cut public education spending by very large amounts.  When Tom Corbett took office, he was faced with a $4 billion deficit.  And the $1 billion in federal funds that was spent on education had run out.  He has been able to erase the aforementioned deficit and increase spending in education without raising taxes.

During his time as governor, Tom Corbett has increased education spending by over $1 billion.  At this time the state of Pennsylvania, the administration is spending more on education than any other time in the state's history.  A total of $374 million has been invested in early childhood education.  Under Corbett, the growth has been $72 million or a 24% increase.

Moving on with Corbett's education policies, he has also assisted low-income families to get their kids to schools.  The Opportunity Scholarship Tax Credit program provides $50 million that can be used for tuition for low-income families.

His administration also expanded the Teacher Evaluation System, giving teachers in Pennsylvania more room to grow, improve, and learn.  The School Performance Profile was created so parents can get an inside view of the quality of the school that their kids are attending.  Last but now least, the Ready to Learn block grant is $200 million that directly impacts Pennsylvania classrooms, making sure that each student is proficient in their grade level reading and math.

Finally, this is indeed a big election for the state of Pennsylvania.  Tom Corbett has done so much good for the state whether it is in keeping taxes down, creating jobs, or funding education.  Be sure to keep Pennsylvania on the right track and vote for Tom Corbett today.

Tom Corbett - Massive Supporter of Education

By Greg Harvey, Treasurer

Needless to say, Governor Corbett is regularly subject to unnecessary criticism. Of all the topics his opponents blast him for, none is more absurd than that of his education performance. With the election coming this year, Democratic candidate Tom Wolf has released a number of campaign ads claiming that Corbett is anti-education; he states (often) that Corbett cut spending for education and has subsequently harmed our schools. However, Wolf’s ads are blatantly wrong, as an overview of actual data shows. 

We’ll start with the main issue: Pennsylvania’s educational spending. Wolf claims that Corbett cut over $1 billion for education, but the Commonwealth Foundation finds this false. While there was a large decrease initially during Corbett’s term, it was not due to his administration. Rather, the $1 billion “cut” was from the expiring of temporary federal stimulus funds. In other words, the decrease in funding was solely due to the federal government ending a stimulus program that was designed to have a limited life, not from state actions. Obviously, it makes little sense to blame a state governor for the actions of the federal government.

On the state end, Corbett has helped to increase state funding for education more that any Pennsylvania governor ever. Looking at the state’s budgets from the Governor’s Budget Office, Corbett has increased the amount of money the Commonwealth of Pennsylvania gives for education purposes every year he’s been in office. Again: he has not cut any state funding for schools. Instead, according to a Yahoo News article, the amount allocated for education in the 2014-2015 budget once again breaks the state’s record for funding with $12 billion budgeted. Fascinatingly, the last two times the record was in 2012 and in 2013, both under Governor Corbett. Clearly, saying this administration hasn’t adequately funded schools doesn’t seem to match up with facts.

That being said, it is true that public schools are struggling financially, but the causes for these troubles are much more complicated. Pennsylvania is currently undergoing a pension crisis for its public school teachers, with $50 billion in pension debt that school districts across the state are struggling to budget for and pay, according to the Washington Examiner. These underfunded pension plans, more than anything else, constitute the reason for our schools’ budget woes and, ultimately, why property taxes continue to rise. The multitude of this debt is too large to fix simply by allocating more money to it from the general budget, as Corbett’s opponents tend to claim. Rather, PennLive reports that Corbett has advocated the best possible solution: shifting teachers’ retirement plans from pension-based to a 401(k) style. Such a shift would save school districts up to $13 billion and be enough to fund the debt. While the plan was struck down in the Pennsylvania Congress earlier this year, Corbett has vowed to continue pressing for it.

In conclusion, Governor Corbett has done everything he can do to keep Pennsylvania’s education top notch, and his opponents’ arguments are not based on fact. Pennsylvania has never spent as much on education as it has under the current administration. The only “cuts” to education were due to the discontinuation of federal stimulus money, which is far outside any governor’s control. Finally, the real causes for the state’s educational budget troubles were from improper retirement planning for more than a decade, and Corbett’s plan would adequately solve the problem. In short, Corbett has proven to be completely pro-education regardless of what Tom Wolf says, and, as a college student, I could not be more thankful for his support.

Tom Corbett - A Jobs Producing Governor

By Greg Harvey, Treasurer

When normal non-economists like us discuss the economy, we talk about jobs- the unemployment rate, whether companies are hiring or firing, etc. Sure, we may mention GDP or the trade balance, but the jobs report is the only tangible measure by which we can actually gauge economic performance. And this focus on jobs is not unwise, as many other economic measurements (such as those previously mentioned) are affected by the health of the labor force. Such a focus on jobs leads to the conclusion that Pennsylvania under Governor Tom Corbett is in a promising position as supported by the data explained in this post.

When Corbett came into office in 2011, the nation was still struggling from the 2008 crash. Though the Great Recession had ended (on paper) in June, 2009, the economy was in a period of economic stagnation, with unemployment stuck at around 9%. Pennsylvania was in a relatively better position at roughly 8% unemployment, but it was far from optimum. Something had to be done.

Once in office, Corbett began a series of business friendly policies which, as will be discussed later, have succeeded in boosting Pennsylvanian job creation. Perhaps most notably, he promoted natural gas drilling; the effects of which were written about by the Bureau of Labor Statistics. Basically, largely because of Corbett’s support, Pennsylvania has become the second largest natural gas drilling state in terms of employment. Other states in the Marcellus Shale generally have less friendly business policies, like New York which bans fracking outright, and have not come even remotely close to matching Pennsylvania’s success. And these jobs, whose average pay of $83,000 easily beat the state’s median pay of $52,267, help to support many other PA industries, according to a Penn State study. Essentially, we can assume that many job gains in other industries since the drilling boom began were caused by Corbett’s adoption of natural gas drilling.

Even though the natural gas industry has been Corbett’s greatest economic success, he has done much more to make Pennsylvania a business friendly state. He’s introduced budgets that would end the simultaneous taxation of business income and business assets, reduce the state corporate tax rate (PA’s rate being the highest in the nation), and allow start-up business tax deductions to aid new businesses, among other positive plans.

Obviously, this would all be for naught if success didn’t follow. Thankfully, Corbett’s plans are working. In June, 2014, Pennsylvania’s unemployment rate dropped to 5.6%, well below the national average of 6.1% and even further from the 8.1% rate Corbett began with. And, considering that Corbett oversaw a decrease of 55,000 government positions, it’s clear that the private sector, easily the most important aspect of the economy, has done very well during Corbett’s term.

However, as with most of Corbett’s accomplishments, there is some ridicule of his performance.  Critics tend to point to PA’s 47^th ranking of job creation in percent since 2011. However, as George Washington University economist Tara Sinclair points out, it’s expected that Pennsylvania’s job growth would be lower than other states because PA was hurt less during the Great Recession compared to the rest of the country. In other words, while other states may gain a larger percentage of growth, it’s merely to replace what they lost, and PA simply has less to replace.

Overall, the job market has made tremendous strides under Governor Tom Corbett. His adoption of business friendly policies, including natural gas companies, has put Pennsylvania in a much better position than when he took over in 2011. However, as is typical nationwide, our economy is not out of the woods yet. Therefore, we need Corbett, because no other candidate will embrace business and subsequently foster job creation like our governor has.