Why Obama's Free Community College Education Is Just Another Inane Obama Idea

As we discussed yesterday, President Obama in tonight's State Of The Union address is going to propose that the Federal government raise taxes and fund a Federal government program that would provide a free community college education for any American who wanted it. The estimated cost of this program would be $60 billion over the first ten years of its existence.

Yesterday, we showed how stupid and worthless it would be to raise taxes to fund such a program since the Federal government wastes so much of our tax money as it is already. From the Pentagon to the National Science Foundation to Federal welfare programs, just tightening up the waste and criminal fraud that is rampant in these existing programs would easily pay for the $60 billion cost. 

That is why no American, rich or poor, should pay a penny more in taxes to fund this program. It can easily be funded by Obama and the rest of the Washington political class actually doing their job to protect taxpayer wealth they have control of now.

But just because you can do another government program is no reason to say you should do a new government program. Let's look at some reasons why this is such a bad idea, regardless of how it is funded:

1) First of all, lets be clear that this program, if approved, will not cost $60 billion. I know of no major government program that has ever come in at or below cost. The "Big Dig" road project in Boston was supposed to cost a few billion dollars and ended up costing over $20 billion.

Chris Edwards, writing for Cato back in September, pointed out that the new train station being built at the site of the destroyed World Trade Center towers was supposed to cost under $2 billion. The project is now eight years behind the schedule and the estimated final cost will likely come in between $3.7 and $4.0 billion or about double what the project was sold to the public for.

The Wall Street Journal reported on a bridge that was supposed to connect Oakland to San Francisco at a cost of $1.4 billion. The final cost of the project is likely to be as high as $6.4 billion, more than four times as expensive.

Obama Care was not supposed to "add one dime to the national debt" but in reality will add over a trillion dollars to the national debt.

Former mayor of San Francisco, Willie Brown, at least had the honesty to tell us the truth when talking about a local project he oversaw: "We always knew the initial estimate was way under the real cost. Just like we never had a real cost for the Central Subway or the Bay Bridge or any other massive construction project. So get off it. In the world of civic projects, the first budget is really just a down payment. If people knew the real cost from the start, nothing would ever be approved. The idea is to get going. Start digging a hole and make it so big, there’s no alternative to coming up with the money to fill it in.”

Obama's $60 billion cost estimate just digs the hole, you can rest assured that more taxpayer wealth will end up being needed to fill it in.

2) We have previously reported on how for-profit schools have taken the American taxpayer for a very expensive ride. The Federal government, using taxpayer wealth, helps to fund the tuition at these schools, many of which are offering very inferior educations. 

The strategy of the schools has been to get as many students enrolled as possible to maximize the revenue they obtain from the Federal government. Once the students are enrolled and their tuition paid for by the taxpayer, the schools could care less if their students get an education, they already have the money.

We outlined how the fraud and money grubbing occurs from a previous post:

- An article in the September 21, 2011 issue of The Week talked about the potential for defrauding the Federal government via scams from the for-profit colleges and schools:

• There are 2,000 for-profit colleges in the country which serve 12% of all American students involved in higher education today, up from 3% ten years ago.
• Critics contend that these colleges mislead applicants about loan costs, overstate the post graduation salaries, target the homeless and disabled veterans to increase enrollment, and provide dubious educations and degrees that do not lead to better paying jobs and careers.
• As an example, they cite the University of Phoenix, the market leader, which graduates less than 9% of its students in six years.
• Bridgepoint Education posted a $216 million profit last year from its 78,000 students despite the fact that 84% of its students drop out within two years of enrolling, the school has 1,700 recruiters but only one job placement person on staff, and according to Senator Tom Harkin, the school is "an absolute scam."
• Many students report worthless degrees with mountains of student loan debt after attending these for-profit institutions.
• The largest for-for profit company has annual revenue of almost five billion dollars and the CEO of another leading for-profit education company took down an annual salary of $42 million, sixty times more than what the president of Harvard University made.

Why should the American taxpayer care about this seemingly shoddy education performance and experience? According to the article, about 75% of the revenue for these companies running the for-profit schools comes from the Federal government via grants and loans. At Bridgepoint Education, 87% of their revenue comes from the Federal government.

A recent Congressional committee report stated that "Some for-profit schools are efficient government-subsidy collectors first and educational institutions second." Some critics claim that the for-profits intentionally target poor and minority students for the express purpose of leveraging their status to get Federal government aid money, which has grown from $4.6 billion in 2000 to $26 billion today.


Don't think for a minute the same thing will not happen when the Federal government incrementally moves tens of billions of dollars into the community college world. Getting Federal dollars will overwhelm the desire to provide a good education at a reasonable price.

3) Simple economics and basic human psychology will cause another problem when something is free. Supply and demand relationships tend to keep price rational and reasonable in a free market. 

However, much like what happened with four year colleges and the massive amount of Federal money that goes to them, by increasing demand for community college educations by reducing the end user/student price by at least $60 billion, the cost for a community college education will go up substantially. It is simple economics, increase demand without increasing the supply, price has to go up. That is why college education costs at four year colleges continually outpace inflation.

When the community college education price goes up, the Federal government will need to put more money into the program to stay whole which will cause more upward price pressure and the death spiral continues on with artificially higher and higher costs.

As with most government projects and programs, the exact opposite happens from what is intended: government interference in a free market transaction results in higher prices and costs, not lower.

4) Let's assume that the the $60 billion cost estimate is really twice as much or about $120 billion, based on our discussion above. I think the cost will be much, much more but let's stay conservative for the sake of discussion.

This comes out to just over $1,000 per U.S.household if the cost was evenly spread out across everyone. Which raises an issue: why should every American household have to kick in over $1,000 so that someone else might get a free community college education? In a free country shouldn't everyone pay for what they want and desire and not rely on the government confiscating wealth from everyone else to give them what they want for free?

5) As we previously reported in this blog, the number of college graduates that are returning home to live with their families is at an all time high since they cannot find jobs in the economy that are commensurate with their college degrees. 

Do we really want to finance more college educated people who cannot find a job because the jobs that the economy needs do not require a college education? I remember reading a story a little while back about how welders had to be imported from China to work on a California bridge project because the buidlers could not find enough American welders to do the work. 

Seems we have plenty of unemployed or under employed college graduates but not enough welders in this country. Why would we want to create more artificial demand for a college education and not be able to do anything with it relative to real jobs  and careers in the real economy?

6) If you really want to improve education int his country, I am sure that if properly spent, that $60 billion would do a much better job if spent on elementary education long before our kids are college aged. We do a horrible job educating our kids relative to the rest of the world, as measured against standardized testing results from other countries.

Find an innovative way to better educate our kids in grammar and high school and the return on that $60 billion investment would be far greater than wasting it on free community college ideas. I emphasize, though, that the $60 billion would have to be spent better and differently than how we currently spend education dollars. History shows that our current status quo way of spending education dollars is basically a failure.

7) And finally, what exactly are we investing in? According to the Community College Research Center website and Federal guidelines, only 22% of community colleges attendees get their community college degree three years of beginning their attendance. Thus, only about one in five community college attendees actually get their degrees, about an 80% failure rate.

Furthermore, only about 15% of community college attendees go on to get a four year degree within six years of first attending a community college, an 85% failure rate. You can bet that these failure rates will go even higher once the Federal government starts subsidizing community colleges with $60 billion. 

Those colleges will look to bring in as many students as possible to maximize their portion of the $60 billion and many of those incremental students will never go on to get a college degree, the same sad story that occurred with the for profit colleges we discussed above.

There you have it, seven good reasons why Obama's free community college idea is a bad idea. And really, nothing in life is free. A free community college education is not free, those costs have not gone away, they have just been redistributed to other taxpayers. And those costs could easily be picked up by government efficiencies, not more taxes as we saw yesterday.

Our book, "Love My Country, Loathe My Government - Fifty First Steps To Restoring Our Freedom And Destroying The American Political Class" is now available at:

www.loathemygovernment.com

It is also available online at Amazon and Barnes and Noble. Please pass our message of freedom onward. Let your friends and family know about our websites and blogs, ask your library to carry the book, and respect freedom for both yourselves and others everyday.

Please visit the following sites for freedom:

Term Limits Now: http://www.howmuchworsecoulditget.com
http://www.reason.com
http://www.cato.org
http://www.bankruptingamerica.org
http://www.conventionofstates.com
http://www.youtube.com/watch?v=08j0sYUOb5w

Part 2, August, 2013 Political Class Insanity: Jay Carney Defies The Law Of Supply and Demand, Training Haitian Prisoners With U.S. Tax Dollars, Building An Army Base That Is Never Used, And More

Yesterday, was our first post of what is likely to be many this month regarding the monthly report on political class insanity in America. Last month we set the record, needing eight days of posts to get in all of the idiocy that the politicians in this country constantly rain down on us. It is a got bet that eights days will not be enough this month as the insanity is growing exponentially month over month.

Yesterday we talked about how U.S. taxpayer month is being used to create youth job programs, not in Chicago or Detroit, but in Belize. We talked about how two members of Congress want to create a new national park, not any park where any American could go and visit, a national park on the moon. We talked about how over $30,000 in taxpayer wealth was being wasted to paint an original oil portrait of former Defense Secretary Leon Panetta. And finally, we learned that roller coaster safety was a hot topic for one Congressman, high unemployment, trillion dollar deficits, failing public schools, and other trivial issues be damned.

Well, it just gets worse today:

1) One thing I always loved about politicians is that they have the lousiest understanding about basic economic theory and reality. Jay Carney, President Obama’s head press secretary reinforced that notion recently when he made the claim that Obama’s vision of immigration reform would raise wages of American workers. Somehow, allowing many more immigrant workers into this country will raise the wages of every worker.

Mr. Carney, did you never take a basic economics course? If you did, they probably covered the elementary reality of “supply and demand.”  If you raise the supply of something without a similar raise in demand, price has to go down, it is a reality of the cosmos. Adding millions of new immigrant workers to the supply of labor in this country will put downward pressure on price, namely wages, because there will be an excess of workers. Given the Obama administration’s inability to manage to a growing economy, it is highly, highly doubtful demand will go up as much as millions of new people into the supply side of the equation.

Mr. Carney’s assertion on higher wages is so inane that many in the press briefing where he stated such started laughing at this ridiculous assertion:

http://www.libertyfirstnews.com/obamas-paid-liar-jay-carney-says-immigration-reform-will-raise-wages-as-press-busts-out-in-laughter/

Unfortunately, Mr. Carney is not alone in his ignorance of basic economics. If this was not the case, our economy would not be trudging along at such an anemic rate. In “Love My Country, Loathe My Government,” we proposed via Step 36 that all members of Congress and the White House take and pass a course on basic economics before allowed to legislate. Unfortunately, that suggestion has not been implemented, as illustrated by  Mr. Carney’s ignorance of the supply and demand theory.

2) Yesterday we reviewed how our political class in Washington was sending half a million dollars to the country of Belize to help create jobs for youth in that country, the high unemployment rate for younger Americans in this country be damned. Well, that is not the only taxpayer funded program that is sending money overseas to train foreign workers.

The Federal government’s Bureau of International Narcotics and Law Enforcement Affairs is sending $95K to JAILS IN HAITI to help train prisoners on textile production. As with the Belize disgrace, this money is being sent with the hope these HAITIAN prisoners will be able to learn skills, so when they are released back into HAITIAN society, they can contribute to that society.

One government official defended the HAITIAN program by stating: “Inmates targeted for participation should be convicted prisoners with remaining sentences between 2-5 years, with higher priority on those with less time remaining. This will give the program continuity through prisoners who continue to participate and facilitate training for others, but also in that acquired skills will still be relevant upon prisoners’ release in a medium-term time frame,”

Typical government nonsense talk. How about training some prisoners in the U.S. who have remaining sentences between 2-5 years, how about giving them some skills so that they can succeed when the get out of U.S. prisons. Who comes up with these types of wasteful spending projects …in other countries no less.

3) In a previous series on political class insanity, we reported on how the Forestry Service was embarrassed when they had hundreds of pounds of explosives stolen from one of their so-called storage bunkers. Well, that kind of incompetence is not restricted to that part of the government, as a recent set of news reports tell of another multi-million dollar heist of government equipment, this time from the U.S. Marshalls organization:

• The US Marshals office has lost/had stolen 2,000 encrypted radios worth $6 million dollars.
• This robbery/heist occurred even though in 2011, an internal U.S. Marshall technology office warned that the Marshals Service was not properly tracking their equipment. 
• In a tribute to understatement, a spokesman for the Marshall Service has publicly stated that he believes “this is in large part attributable to poor record keeping .” Ya think?
• As always, worse than the crime was the cover up.
• When news agencies started submitting Freedom of Information Act (FOIA) requests, there was instruction for upper management at the organization to no longer discuss the lost/stolen equipment. 
• Worse than the crime and the cover up is the lie that follows. Several documents obtained through FOIA requests including a note from the agency’s director asking employees to estimate a lower dollar value for the missing equipment to make the screw up not appear as bad as it was. 

But worst than the heist, worst than the cover up, and worse than the lie is the fact that a facet of national security may have been compromised. There is some evidence to indicate that these encrypted radios could have ended up in foreign, possibly hostile hands. In 2012, one of the missing radios showed up on eBay from a seller based in Hong Kong. 

When the Marshal Service spent more taxpayer money to buy  back their own missing radio, they found that the radio had been disassembled and reassembled, which leads to new troubling questions of how vulnerable this makes the Marshals Service.

Incompetence, cover ups, lies, and breeches of national security. This episode of insanity had everything.

4) Many times we have reported on the wasteful and corrupt spending in Afghanistan. We previously discussed how the State department, under Hillary Clinton, ignored its own security guidelines to build an $80 million consulate in Afghanistan and THEN realized that it was not defendable against terrorist attacks, which they would have realized if they had not ignored their own guidelines.

We know that as our part in the conflict winds down, we are going to leave about $7 billion worth of military gear behind after we leave, military gear that I would bet eventually ends up in the hands of the Taliban.

The latest corruption apparently wasted $34 million of taxpayer loot for no reason at all:

• When a two-star general recently visited a new 64,000-square-foot US military headquarters building  in southern Afghanistan, he was so impressed that he stated that  “It's "better appointed than any Marine headquarters anywhere in the world.”
• Impressive, except for the fact, as reported by the Washington post, that the facility has never been used and likely will never be used by U.S. troops.
• Much like the never used but very expensive State Department consulate, a top Marine commander had warned the Pentagon brass that the building was unnecessary three years ago but his insightful opinions were ignored. 
• The building was originally commissioned for the 2009 troop surge  but by the time construction began that troop surge was over.
• "This is an example of what is wrong with military construction in general," the special inspector general for Afghan reconstruction told Chuck Hagel in a recent letter. Another wonderful understatement.

So between these two disastrous spending, $34 million and $80 million, we have $114 million that went down the drain. $114 million that could have operated White House tours for over 114 years. We could provide combat pay for our military personnel that are serving in dangerous areas but who have had their pay cut. The July 4th celebrations at military bases to celebrate those that serve would not have been postponed.

So many worthwhile uses of over $100 million that had no military or societal benefit.

Another day and we are just getting started. Federal government loses millions of dollars of electronics equipment. Federal government blows over $100 million for nothing. Haiti prisoners are taught skills, U.S. prisoners are not. And economic ignorance I still alive and well in Washington. More bad news tomorrow.

Our book, "Love My Country, Loathe My Government - Fifty First Steps To Restoring Our Freedom And Destroying The American Political Class" is now available at:

www.loathemygovernment.com

It is also available online at Amazon and Barnes and Noble. Please pass our message of freedom onward. Let your friends and family know about our websites and blogs, ask your library to carry the book, and respect freedom for both yourselves and others everyday.

Please visit the following sites for freedom:

Term Limits Now: http://www.howmuchworsecoulditget.com
http://www.reason.com
http://www.cato.org
http://www.robertringer.com/
http://www.youtube.com/watch?v=08j0sYUOb5w