Tuesday, February 7, 2012

Subsidize Behavior and You Get More of It…

Whether the behavior is good or bad, if you subsidize it with government dollars you will get more of that behavior. That is why measuring results is so important for government programs. What government programs measure results? Well, all of them actually but the results are either ignored or excused with the notion that not enough money was spent to get the results that were hoped to be achieved.

Recently VP Biden said that the reason college tuition keeps going up is because colleges get government subsidies. Government money continues to be funneled into higher education with the assumption that college educations are important for America. College education is good for individuals that really want an education. The problem is every student that wants a college education is not necessarily prepared or in need of a college education for their chosen career path.

If government stopped subsidizing education the result would be lower tuition costs with a more qualified student population. Government subsidies help marginal students gain access to the system even when they are poorly prepared to attend colleges. It has resulted in remedial programs at the college level. If a kid needs to take remedial classes at the college level the question should be how did they get into college in the first place? That is a total waste of money.  Government subsidies also allow Colleges and Universities to operate without worrying about efficiency. They can hire and keep classes that only a few students choose to take. They don’t have to manage the budget to market principles knowing they will get increased revenue even if they are running at less than optimal efficiency.

Government subsidies create more poverty, less access to healthcare, poor housing conditions, and they steal individual incentives and drive. By subsidizing the poor we have created an “acceptable” life style that no individual would choose if they had a choice. Government subsidies for healthcare are making access almost impossible because people that get it for “free” use with no discretion to cost. By subsidizing housing we create ghettos where no one feels connected to their home. And the most important thing government subsidies do to harm us is to steal the ingenuity, accountability, and happiness that comes with providing for one’s self.

The greatest thing we could do to improve the lives of millions of Americans is to remove government subsidies completely. Government subsidies do more harm than good. First do no harm would be a good oath for the next President to take…

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