A Gift That Turns into an Expense

Ted Nesi notes that Rhode Island has moved up a couple of notches on a nationwide scale when it comes to funding higher education in the state budget. The reason, however, is that our officials are better at dancing to the federal tune:

However, Rhode Island was one of only five states that has federal stimulus money for higher education in its current budget, and the whopping $30.2 million in stabilization funds Rhode Island received was twice as much as second-place New York's $14.4 million and 190 times as much as West Virginia's $158,781.

When federal money is excluded, Rhode Island's spending on higher education rose by a more modest $6.1 million, or just under 4%, to $163.5 million. That's down 17% from the $196.4 million in state money Rhode Island spent on URI, RIC and CCRI as the recession began in 2006-07.

So, the federal government is propping up Rhode Island's higher ed. expenditure with money that it doesn't have, and you can bet we'll hear calls about the moral necessity of replacing them with state funds when they go away. This as the walls of the higher education bubble attenuate to the point of bursting.

Subsidies for public universities and colleges are another illustration of the backwards thinking that government's taxation and bonding powers have enabled. We're like a car buyer who begins with a list of features without regard to the ability to afford them. If higher education merits a larger public investment, then let's figure out what other government expenditures are of less value and reduce them.

Frankly, I think dollars spent is the wrong way to judge a public system's success. With a different standard for judgment, we might focus more on how we achieve more for the dollars we spend than how we can manipulate the government financial system to grab more money.