Surprise! Low tuition fees are a benefit – to the rich

Starting in the fall of 2012, university students will see their tuition fees rise by $325 a year for five years. In 2016-2017, this will represent an additional $265 million of financing for universities that desperately need it after so many years of being underfinanced. Students will certainly pay more on average, but in return they will get a better education that will grant them access to much higher salaries than their fellow citizens who don’t have a university degree.

Social groups against the 99%

The student movement is fighting this increase in the name of accessibility to university studies, and different social groups are supporting them in their battle. What they do not seem to realize, however, is that uniformly low tuition fees represent a wealth transfer… to the rich.

It is the indignant Occupy Montreal protesters who should be upset, since what they are calling for is the redistribution of wealth from the rich to the poor!

The link between university accessibility and tuition fees is tenuous at best. Financial obstacles explain only a small part of why students from poor families have less university schooling.

According to Statistics Canada, with average tuition fees of $5,366 across Canada, we find 62 youths from poorer families in school for every 100 youths from families that are better off. In Quebec alone? The proportion is just 44 for every 100, despite fees that are half as high ($2,519). It would take 18 more students from less affluent environments just to reach the Canadian average. Very low tuition fees for all, even for the wealthiest, have not guaranteed access to these 18 youths.

Uniformly low tuition fees are tantamount to giving the same subsidy to everyone, regardless of their financial means. Accessibility requires instead that aid be directed toward those who really need it, as is done with loans and scholarships.

How much should one pay for a winning lottery ticket?

Since low tuition fees are not a decisive factor in university attendance, some people instead point the finger at student debt.

Studying is first of all a personal choice that benefits the student. In the vast majority of cases, pursuing one’s education turns out to be an excellent decision that makes one better off in the long run. The numbers vary somewhat from one program to the next, but overall, it is estimated that the holder of a bachelor’s degree will earn nearly a million dollars more over the course of a lifetime than someone with only a high school diploma.

However, in order to reap the benefits, there is an investment to be made, in terms of both time and money. The fact that one needs to take on debt to study is not bad in itself. Investing $14,000 (or taking on that much debt) in order to earn a million dollars is a great deal.

For access to a quality education

The real danger that Quebec universities currently face is not accessibility, but rather the erosion of the quality of education. This is a very insidious trend since it is less visible. In Germany, most of the states (Länder) offer free university, but no German university is ranked among the best institutions in the world. A mediocre education is not expensive, but is that really what we want for our youth?

When Quebec graduates are no longer able to compete with those in the rest of North America, access to a quality university education will no longer exist in Quebec!

We should transmit this message to protesting students: instead of taking the streets for a second-rate education, with placards and slogans, demonstrate for the quality of your education, so that the diploma you will receive after several years of effort, both intellectual and financial, is recognized as a mark of quality.

Youri Chassin and Germain Belzile, respectively economist and director of research at the Montreal Economic Institute.