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Bernie Sanders’ campaign platform states, “It’s Time to Make College Tuition Free and Debt Free.” I agree with this ideology, but I believe that it is too simplistic a solution for our country’s educational dilemmas. Problematic factors include: Sanders’ proposal for financing college, as well as students spending four years attending college for a career that doesn’t require a college education and prolonging occupational opportunities. Moving toward an economy in a liberal democracy that accepts workers in various industries without a college degree would be a much more beneficial shift forward.
The United States needs a stronger high school education system that provides post-secondary opportunities to students like apprenticeships and vocational schools, as well as universities. That way, individuals can graduate, jump onto their chosen track, and be better directed toward their future career. People may as well begin their job search when they are young, and be able to find good jobs via a high school diploma or vocational training. What it really comes down to is the idea that many jobs, except those of high professions, do not require a bachelor’s degree, but rather apprentice-like schooling and training. Once a better system is in place, the government can look to make college more affordable.
Back in the mid-1900s, high school was viewed as the final stepping stone into the real world. In fact, many individuals worked during high school. A high school diploma was necessary to get a good job, and a college degree was required for a professional career. Now, everyone needs a high school diploma for one thing: to get into college, which offers degrees that may get you a good job.
“Free” is a big word in Sanders’ platform. However, nothing today is free. And just how does Bernie Sanders want to make college tuition free? By imposing a tax on Wall Street speculation.
“My legislation would impose a Wall Street speculation fee of 0.5 percent on stock trades (that’s 50 cents for every $100 worth of stock), a 0.1 percent fee on bonds, and a 0.005 percent fee on derivatives,” Sanders said in a statement.
So think of it as a sales tax of 0.5 percent on the dollar. According to this year’s Gallup Poll of American representation in the U.S. Stock Market, 55 percent of Americans are invested in the market (it is unclear how much of that 55 percent engages in speculation). Now Sanders intends to pull from the rich and large hedge funds with his tax on Wall Street, but I would like to point out that this still could affect other segments of the U.S. population, especially if the stock market crashed and large amounts of people pulled out and chose to refrain from speculating. In that case, the original estimate of $300 billion per year as stated by Sanders would no longer be available in such vast amounts required to pay students’ tuition. The estimate could also increase as universities continue to raise the cost of attendance, and Wall Street would continue to pay.
Countries like Germany, Finland and Denmark are globally known for their ability to produce and shape intelligent minds for a cheaper price. Sanders’ platform highlights the free education provided by Germany, Norway, Sweden and Finland in his first of “six steps that Bernie will take as president to make college debt free.” What Sanders fails to note is that Germany is a Christian democracy, and the Scandinavian countries social democracies. The United States’ democracy falls more toward classical liberalism; while all three are democratic states, the U.S. has much lower tax rates. This ultimately leads to a smaller return in financial aid to the people.
I use the words “cheaper price” when addressing the educational systems of these nations because they are not free and again, have different governmental income tax rates that feed the education systems. For example, the income tax bracket for a single employed German citizen is 42 percent if the individual makes between $55,836 and $267,651 USD per year (converted from current Euro of 1 EUR to 1.07 USD), and 45 percent for anything above. This is much higher than the income tax bracket for a single employed U.S. citizen of 25 percent for an income between 37,541 and 90,750 USD per year. The U.S. tax rate gradually increases to a maximum tax of 39.6 percent if $413,200 USD or more is earned per year. It is difficult to attempt to follow the model of countries like Germany, when the government system is quite different. In 2014, Germany’s total tax wedge in percent of labor costs was 49.3 percent, where the United States sat at 31.5 percent.
“While the tax wedge is certainly not driven solely by free-college tuition costs, the countries that offer this benefit have much higher income tax rates than the U.S. If the U.S. were to go the route of European countries and finance free tuition by taxing the income of citizens, the tax wedge of 31.5 percent would likely increase,” wrote Abby Jackson in January for Business Insider.
Germany not only taxes more than the U.S., but also directs a larger portion of their government expenditure to various tiers of education and welfare spending. Instead of beginning with free tuition like Germany, the U.S. must focus on restructuring itself to work like Germany.
It would have to start with high school students graduating and find a well-paying job or spending four years in a trade school/apprenticeship or attending university. Vocational training gives recent high school graduates a head start in the job market while simultaneously teaching them a trade. The system allows German students to find less skill-intensive jobs quickly, thus leaving university to those wanting to earn professional degrees.
Since 2006 the United States and Germany have both spent around 26 percent of their government expenditures on tertiary (university) education. Where the gap lies is in secondary (high school) educational spending. Since 2006, Germany has averaged around 10 percent more spending on secondary education than the United States. Germany puts a lot of money into its high schools to prepare students for jobs and training right away.
Their secondary education system is made up of three schools: Hauptschule, Realschule, and Gymnasium. Each school prepares the student for a different job path: Gymnasium leads to university or directly to the job market, and Hauptschule/ Realschule guide students towards vocational training. This structure works well, with German students ranking 14th to the U.S.’s 20th in educational attainment. I am not saying that the U.S. secondary system needs to mirror the German system, but I do feel we and Sanders should focus on improving the lower rungs of the ladder before giving away free college tuition.
Some argue that the college cost is not an issue because U.S. college graduates make about 66 percent more than our high school graduates and have lower unemployment. Research compiled by Cornerstone University, a private Christian school, points to higher lifetime earnings and less unemployment for those with college degrees than those without. Or, according to the U.S. Census Bureau, college graduates make close to one million more USD in a 40-year working career than high school graduates.
“There has been a lot of press about rising student debt, but by most measures, the college wage premium [effect of a college degree on wages] covers the cost of attending college. On a basic micro-econ level, taxing anything and transferring money has some dead weight loss associated with it, and I have trouble understanding a public policy focus on a population in society that is, economically, the most well-off,” an economics professor at CU said.
Another perspective is that many students don’t know what they want to do with their lives in high school, let alone college. In fact, the average college student changes their major three times throughout their college career. According to a 2014 study by staffing firm Express Employment Professionals, debt is also a factor preventing many graduates from exploring their first career choice.
I believe that Bernie Sanders is trying to improve education. However, he has failed to address the real issue. Sanders should push to create a movement to overhaul the secondary school system in terms of resources and structure while providing free education. Should he be elected next November, U.S. high schools will then be able to better mirror the tertiary curriculum of college programs to aid in student progression.