Sunday, August 06, 2017

 

Tying the Peasants to the Land


Fifty years ago, when community colleges were springing up at the rate of one a week across the country, people were mobile and capital wasn’t.  Extending education to previously underserved areas made sense because the money in those areas was likely to stay there and to grow; companies needed workers.  

Twenty-five years ago, both people and capital were mobile.  We started to see the rural/metro split we know now, but it was still common for people to pull up roots and go where the work was.  Community colleges stopped springing up, but they were able to maintain and even grow enrollment by serving, in part, as ways to attract capital to a region.  A company wouldn’t be likely to relocate to an area where it couldn’t find qualified workers.  A community college could help it grow (or upskill) some of its own.

Now, capital is more mobile than ever, but we’re building barriers to keep people in place.  Both New York and Rhode Island have passed “free college” programs that come with post-graduation in-state residency requirements.  Rhode Island is all of two counties; that’s pretty restrictive.  At this point, states are starting to look not only at institutions as tools to accomplish policy goals, but at citizenry the same way.  Why educate them, the argument goes, if they’ll just up and leave?

Ugh.

We’ve seen plenty of discussion of border walls and travel restrictions at the national level in the last year or so.  But now we’re starting to see a less conspicuous version of it at the state level.  The state-level version doesn’t have quite the racial charge to it that the national one does, but it’s hard not to see the two as being of a piece.  They’re about tying the peasants to the land.

The dangers of both policies are clear.  At a really basic level, they invite -- sometimes almost compel -- reciprocation.  If New York keeps its “human capital” but New Jersey doesn’t, at some point, someone in NJ will notice the imbalance and try to right it.  That may trigger Pennsylvania.  Then Maryland, Delaware, and Virginia.  Then…

Ask any economist about the efficiency losses of protectionism.  If we train smart people in New York but their talents could best be used in California, then we wind up settling for second- or third-best uses of their talents.  And that’s assuming we find those uses at all.  Remember the Great Recession?  Imagine graduating the University of Michigan in 2009, only to be told that leaving the state would require ponying up all that past tuition, but the in-state economy simply isn’t hiring.  

Conservative economist Tyler Cowen has argued, I think correctly, that people going where the opportunity is often leads to better outcomes all around.  Shackling them to a depressed region isn’t likely to lead to positive outcomes.

Residency requirements, if they spread, would also greatly shift the balance of power when companies play states off against each other in bidding wars for relocations.  As hard as it is to move for a job -- something I know personally -- it’s that much harder to see the job move away and know that you don’t have the option to follow it.  That already happens between countries, but moves between states are much more common.  Allow capital to move but tie workers to places, and I’d expect to see ever more public funding get diverted -- whether directly, as through subsidies, or indirectly, as through tax credits or abatements -- to owners, even as wages go down.  Income polarization in the US is combustible enough already without adding lighter fluid to it.

Then there’s the simple fact of what life is like in the twenties.  Those are often family-formation years, as well as the years when people are likeliest to pull up stakes and go to where the grass is greener.  Can you imagine having to pay the state the equivalent of either bail or a dowry (depending on taste) to get to be with your beloved?  That won’t lead to anything good.  

And at a really basic level, the idea confuses means with ends.  People aren’t supposed to be tools to realize goals of the state.  The state is supposed to be a tool to realize the goals of people.  Social contract theory isn’t new, but it’s based on an insight that still holds: the state is here to serve us, not the other way around.  This kind of economic coercion, essentially kneecapping the educated young for the short-term gain of the state, is a category mistake.

I know that Richard Florida, among others, is pushing “devolution” as the path to equality, but this isn’t a path to equality.  It’s a path to separatism, fatalism, and retaliation.  

We’re at the early stages yet, which is good and bad.  It’s bad, in the sense that the pattern is still invisible to many.  But it’s good, in the sense that we can stop the snowball before it gets very far down the hill.

We have to stop it.  The point of public education is to benefit everybody.  Sometimes that means sending folks off to places where their unique talents will make a better fit.  That’s fine; that’s what makes the economy work.  But even if the economics turn out to be a wash, there’s a deeper ethical point here.  Education is about, among other things, freedom.  If some of the peasants want to flee the land, let them.  If states want to keep more of their own, and attract others from outside, let them make themselves more appealing destinations.  Attract the ones who want to be there, rather than trapping the ones who don’t.  

Tennessee and Oregon have shown that “free community college” doesn’t have to work this way.  Instead, it can empower people to make their own choices.  Here’s hoping we follow those models, and convince New York and Rhode Island to change before the unintended consequences start to metastasize.  Combine a residency requirement with a nasty recession, and it won’t be pretty.  Let the students go.

Comments:
Yes, a Smoot-Hawley tariff creating protectionism in education will likely backfire just like the real one did when trying to end the Great Depression in 1930.

Consider University of Michigan students whose families have lived in Michigan their entire lives, paying taxes and then attending as an in-state student. By one measure, they have already paid for everything they get. Ditto for an out-of-state student, who pays full fare. Why treat them differently, forcing the in-state student to pay back the equivalent of out-of-state tuition or face difficult job prospects compared to the completely mobile out-of-state student? If they are looking for fairness, they should do a more careful job with students who get in-state status after living in the state for only a year or two.

I also wonder what the data say about out-of-state students. How many of them stay, a win-win situation for the state, in comparison to the in-state students who leave?
 

Really Good blog post about tying the pesants to the land .provided a helpful information.I hope that you will post more updates like this.
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Tis needs to e said loudly and over and over again. Could you repurpose this as an op-ed, and get it published for a larger audience?

I will note that this has a certain resonance for me. In the 1970s, in the regional economic development literature, there was a debate about whether development policy should focus on people or places. To the extent that regional development policies were formulated by and implemented by state and local governments, the "place" argument was likely to win. So some of us argued for a very much expanded role for the federal government--an argument that did not exactly triumph. I would make the same point here. The logical starting point of an argument that education policy should focus on people is to argue for a larger, not smaller, role for the feds. I'm not particularly sanguine about that.
 
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This fear is a little overblown if you ask me. A free education is worth something. Someone gives up a freedom (mobility) in exchange for the value implicit in a college education. Good. Hope you made the right choice. In fact, some people may only be able to get an education by making this barter. Great for society. Especially since the social security taxes you pay help support the entire county. Here is the only real problem to consider...is one allowed to pay off the outstanding unpaid balance on your education if you leave and go somewhere else. If so, then this is great policy. Let individuals decide. If they have to make some promises about committing themselves to a place (teachers in teacher colleges) or a job (the Military) to get a leg up then so be it.
 
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