Monday, March 03, 2014

More Evidence Higher Ed is Insanely Over-Funded In Arkansas

I have maintained for years that higher education is extremely over-funded in Arkansas.   Heavy subsidies of higher education does not "create jobs" in this state, because labor is mobile.  Rather, when a state has a higher-ed system grossly disproportionate to the size of its underlying existing real economy higher ed is a subsidy from the taxpayers of that state to the economies of other states where the students must go to find work.   Or those students graduate and then take a job around here which does not require a college degree, in which case the higher ed represents of massive misallocation of resources.

Now I have a study whose results back me up, even though its is not what it is trying to do.  The article is yet another attempt to bleed the taxpayers for more higher-ed money.  It claims that if current trends in higher-ed funding continue, then within a certain number of years in one state after another the states will provide zero dollars for higher ed.  Really all they are doing is taking a trend where the most wild-eyed over-spending for higher ed is being ratcheted back a notch and extrapolating that trend to absurd degrees to get their chart.  In Arkansas, and in many other states I suspect, most if not all of the "reductions" in spending are due to falling revenues from lottery proceeds spent on education. But the chart still shows who the outlier is- Arkansas.

Take a look for yourself, it is about a third of the way down and to the right on this link.  Using their unsound extrapolation of data, 47 states will quit funding higher ed completely by the year 2140.  Three states will continue to fund it. Ten years later, one of those three, Georgia, will quit funding it. For the next 45 years, only two states will fund higher-ed until in 2194 New Mexico's subsidies to higher ed would cease.  For the next 73 years, only one state would be subsidizing higher-ed- Arkansas.

Again, the conclusions about how far the reductions would go are silly, but the chart and data are still useful for showing how ridiculously out-of whack our state is compared to the rest of the nation on higher ed.   If lavishing grotesque amounts of tax dollars on higher ed really was some kind of key to prosperity, one would think we would be the richest state in the union instead of one of the poorest.

One trouble may be that there is no major party in this state which acts as any kind of restraint for higher ed spending.    The Democrats want to spend money on it, but so do many of the Republicans who have big ideas about "work force education" (a planned economy with respect to labor inputs as opposed to a free market).   Many big republican legislators are paid by colleges, such as Gilbert Baker and now Johnny Key.   There is no party of no when it comes to higher ed spending in this state, and it shows.

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