It also shows that, given there were only 400 members of this year's Morehouse class, college education is way too expensive, and massive debt is too easily taken on. At $100,000 per graduate, that $40 million accumulates rapidly; and let's not forget that we are in a time of federalized student loans. Can’t blame this cost on the banks, although Congresswoman Maxine Walters did exactly that at a hearing last month. Confronting CEOs of several large banks, Cong. Walters demanded they explain why there was such a huge amount of student debt. Amused, one said that his bank hadn’t made a student loan since 2007; another politely reminded Madame Chairwoman that the federal government took over the student loan programs in 2009. Not quite sharp enough to understand the significance of their answers, Cong. Walters plowed ahead, oblivious, as she is in so many cases, to reality.
Look at it this way: if someone paid $5,000 to each person who wants to buy a General Motors car, what do you think would happen? GM would sell a lot more cars, and also would think that reducing its costs would be financially damaging. After all, if someone else is covering a good chunk of the expense, why hold the cost down? Why not charge more?
Let’s not forget that several of the Democrat candidates for president want to make college “free,” by which they mean at no cost to the user. We can’t believe they expect the schools to charge nothing or the professors or clerical staff to work for nothing; therefore to make college “free,” someone else must be paying for it. And with, depending on the candidate, others promoting plans for “free” child care, day care, vacations, medical care etc., there are going to have to be a lot of Robert F. Smiths, each with an unlimited supply of funds. As the humorists pointed out during the push for “Hillarycare” back during the first two years of the Clinton administration: “If you think healthcare is expensive now, just wait until it is free.” It could hardly be better said, and applies equally to college or day care or childbearing leave or automobiles: when the market doesn’t reflect the actual cost of the good or product, demand soars and there is little incentive to conserve or to hold down costs.
Mr. Smith’s gift to the Morehouse graduates is admirable and one of the nicest gestures in our memory, and we would love to see more people take similar actions, but, oh, yes. . . those candidates who want to give away all that “free” stuff also want to repeal the Trump tax cuts, raise taxes on the wealthy, levy a ‘millionaire’s tax,’ impose a ‘'’wealth tax,’ etc. Today, Robert F. Smith has the power to choose to give away his money. If it is all taxed away, however, the government will be the one “giving it away” and deciding where it will go, and taking credit for doing so.
No one should expect anybody will perpetually cover the cost of everything for everybody; and that “someone” also includes the taxpayers, who will be expected to pay for a ton of “free” stuff if one of those Democrats is elected in 2020.