Tuesday, March 29, 2011

Higher Learning

The Liberals have rolled out their first major policy plank of the campaign - the Learning Passport, which will mean $1,000 a year to every student attending post-secondary education.

The biggest knock on Ignatieff has always been that voters don't know what he stands for. With that in mind, the Liberal platform will be especially important this campaign, as it will be the document that defines Ignatieff. So how does this policy look?

When looking at a campaign policy, there are seven key questions that need to be asked:

1. Is it easy to understand? Can this policy be explained in a 10 second pitch or on a 140 character tweet? In this case, you can explain it in 11 words: "one thousand dollars a year to students, to encourage University education".

2. Will it be seen as meaningful by voters? For anyone in University, or with children approaching that age, this will certainly help.

3. Does it address a need or fix a problem? Yup - university tuition rates have skyrocketed in recent years.

4. Does it say something about the party's values? In this case, it shows the Liberals and Ignatieff value education.

5. Does it differ you from your competition? That remains to be seen, but it seems unlikely the Tories will make a similar pledge.

6. Does it speak to your base and your target vote? Liberal voters tend to be university educated, so this is clearly something they value.

7. And, least importantly, is it good policy? There are probably better ways to go about this but, at the absolute worst, it incentivizes post secondary education.

On all counts, this policy performs quite well. To me, it looks like a winner.

Hopefully we see more of this over the course of the campaign.

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  • Paying students through the RESPs seems like it will primarily favour students already reasonably well off. As you say, it's something, and that's better than nothing, but I wouldn't champion this as a winning plank.

    It also does nothing to actually deal with the cause of rising tuition, so this handout will be effectively useless in a few years (although that's still better than not getting anything for 5 years).

    By Blogger Ian, at 3:07 p.m.  

  • Gee, just what we need - more credential inflation. Rising tuition is a symptom of a structural problem in the education system, not the problem in and of itself. Status-seeking motives, a poor understanding of the costs/benefits of university, and the fact that people don't pay the full price of a degree have led to excess demand. The learning passport is the kind of terrible policy driving this mess.

    The result is what the Chronicle of Higher education has suggested is a bubble in higher learning, as tuition and demand for university degrees outstrips its fundamental value: the university wage premium (which has been stagnant for at least a decade).

    Equal access is great, but increased access is lowering the quality of education by turning universities into high schools. The number of students that graduate in 4-years has shrunk precipitously, and one would be hard-pressed to find a professor willing to argue that the students they produce are better than a generation ago (and don't get me started on the burgeoning private sector postsecondary market - which is ridden with crooks).

    The result for graduates - especially young ones - is credential inflation, and often crushing disappointment when their expectations (rooted in outcomes for their parents generation) are not met by the job market. The hipster generation is going to be like hobos in more than just the way it dresses soon enough.

    By Anonymous hosertohoosier, at 3:17 p.m.  

  • Does it differ you from your competition? That remains to be seen, but it seems unlikely the Tories will make a similar pledge

    The comparison I am seeing written about is with the dead-on-arrival income splitting "promise" of Harpers: that the Liberals are giving direct help to all parents right now, while the Conservatives say corporations, jets and prisons first, families someday way in the future maybe.

    By Blogger Ted Betts, at 3:19 p.m.  

  • Ted - it's a good contrast. With Harper, you wait in line 5 years for your tax cut, after the corporations get theirs. With the Liberals, you get it now.

    By Blogger calgarygrit, at 3:22 p.m.  

  • I remembered something like this policy from the 2006 election. Here's the story I could find: http://www.ctv.ca/servlet/ArticleNews/story/CTVNews/20060104/ELXN_libs_education_060105?s_name=election2006&no_ads=

    Personally, as a post-secondary student I feel extremely jaded about the ability of education to find anyone a job. Students will often find that it who you know rather than what you know.

    By Anonymous Sean, at 3:28 p.m.  

  • Ted,

    How is this direct help for parents now? At most it will help only those parents whose kids go on to post-secondary education (a disproportionate percentage of whom, to be blunt, need no assistance - universities still remain that bastions of the upper-middle class). And since it provides for a payment over four years, it won't fully benefit anyone until four years from now (sound familiar?).

    On top of which, one might well ask, if you're going to do this, why not boost the millenium scholarship fund (i.e.,providing money based on need?). Why not just provide university (or college students) with $1000 a year for their first four years. Why go through the rigamorole of using the RESP system which will impose costs on the public for setting up RESPS and which exposes students to the risk of loss if they invest the RESP funds poorly (one hopes people would invest them prudently, but I'm not under any illusions).

    On top of which, why announce a "new" $1000 which is funded by eliminating the old education ammount and text book credit amount, which is worth roughly $500 a year to full-time students (less for part-time students). Not only does that mean that half of the Liberal's "new" money is just repackaged "old" money, it also means that part-time students (you know, who might be part-time students because they're facing hardships - trying to support kids, start a new life, etc. - unlike the rich kids whose daddies are paying for university) end up being worse off under the Liberal proposal. That's a losing proposition in my books.

    By Blogger Carl, at 3:29 p.m.  

  • I see a perfect campaign ad coming -- a long lineup, airport terminal style of kids, seniors, young families, single parents, immigrants waiting patiently, tiredly, as CEOs and rich breeze by laughing, clinking their champagne glasses. An old man and his 22-year-old fiancee race past on the fuel of viagra... Stephen Harper wants your vote so he can pass along your hard-earned tax dollars to his friends.

    By Blogger rockfish, at 3:30 p.m.  

  • I also didn't realize that this replaces the education tax credit, which most students tend not to need since they don't tend to earn much money, but may actually make a difference to student's working to pay for school. I'd have to see the numbers run to know what is actually better in the long run.

    By Blogger Ian, at 3:34 p.m.  

  • Carl, show me the numbers/stats on post-secondary students and their families financial backgrounds. Perhaps you could assume that some of that number is skewed because many of those who are qualified academically but don't have the fiscal wherewithal to follow through, are being held out of the picture.
    Even if I accept your idea, your telling students that $500 more towards tuition is a bad thing? When income from parttime jobs have frozen - and now working students are facing competition for those jobs from the underemployed, seniors with inadequate pensions/lost savings and unemployed from the economic meltdown? Things have only gotten tougher for students over the past 5-6 years. I don't believe most Canadians want free tuition.

    By Blogger rockfish, at 3:35 p.m.  

  • "Personally, as a post-secondary student I feel extremely jaded about the ability of education to find anyone a job. Students will often find that it who you know rather than what you know."

    That is the direct product of credential inflation. When everybody has a BA, education no longer distinguishes you from everybody else - instead it is connections that will get you ahead.

    As good liberals we believe that education humanizes people and makes them better. The first hard truth is that it is an expensive coming of age ritual - apart from specialized professions I don't think people learn very much. The second is that people compete for spaces as part of a zero-sum game for scarce jobs, not to become better people. The third is that intelligence and work ethic are largely innate qualities - at least by the time somebody is 18.

    By Blogger french wedding cat, at 3:40 p.m.  

  • Carl:

    This is funded through the RESP so it can be used for any certified education, not just university degrees.

    Can't beef up the Millenium Fund because Harper cancelled it.

    Don't know what you are talking about with respect to 4 years. It will be paying out fully each year from 2012 onward. Harper's income splitting "promise", if you ever get it, won't come for another 6 or 7 years and only if the deficit is slayed and only if Harper gets a majority and only if you fit into the narrow definition of those who get it and only if you are wealthy and only if... only if... only if...

    It goes through the RESP program because that is already up and running effectively. No new bureaucracy, no waste on much more administration.

    By Blogger Ted Betts, at 3:40 p.m.  

  • Carl, this article mentions the relevant data. About 30% of kids in the bottom quartile go to university, while 50% in the top quartile do: http://older.kingsjournalism.com/nnn/nova_news_3588_10524.html

    (sadly, I think Ignatieff's policy probably is good politics. I do not hold out much hope for an anti-education revolution... at least until the baby boomers kick out their millennial kids)

    By Anonymous hosertohoosier, at 3:44 p.m.  

  • Hoser: Do you have similar statistics for all education and not just university education?

    RESPs can be used for colleges and all sorts of training now.

    By Blogger Ted Betts, at 3:45 p.m.  

  • So giving students an extra 1000 dollars a year to get more students with more money chasing the same amount of university slots helps control the rising costs of university how?

    Also, how is promising $4000 for students 4 years in the future any different than promising income splitting 5 years in the future?

    By Blogger Traciatim, at 3:46 p.m.  

  • Traciatim:

    It is money and assistance right now, not 4 years from now. And not 6 or 7 years or never like the income splitting "promise" of Harper's.

    And it is geared toward providing families assistance, not reducing tuition which would be a provincial matter the feds can't touch.

    Also, unless I'm mistaken, it is not just for universities since it goes through the RESP.

    By Blogger Ted Betts, at 3:55 p.m.  

  • Interesting to see what the transition will cover. Looks like it will try to help current students as well. From the website linked:
    Q: Does the Learning Passport apply only to future students, or will current students be eligible?

    A: The Learning Passport is intended for future students going into college and university. We will implement a transition period in which current college and university students will be able to open RESP accounts and receive the Learning Passport for the remainder of their studies.

    By Blogger UWHabs, at 4:00 p.m.  

  • This report has data for all forms of post-secondary education (inc. college), as of 2001.

    % in post-secondary by parental income:
    <25k: 48.9%
    25-50k: 59.8%
    50-75k: 63.2%
    75-100k: 76.3%
    >100k: 77.4%

    So yes, this is a pretty regressive policy.


    By Blogger french wedding cat, at 4:00 p.m.  

  • Backwards, right-wing, neo-con Conservatives believe this proves poor families produce children less capable of having the intelligence to go to university. Progressive, family-friendly Liberals believe we need to provide extra support so children of low income families can better afford post-secondary education. Way to go Iggy!

    By Blogger LoyalLiberal, at 4:55 p.m.  

  • It does offer $1500 for low income students, so it is attempting to address the inequity issue.

    And the "you won't see any cash for 4 years" thing strikes me as a silly talking point. They'll get the cash every year - presumably starting this fall.

    By Blogger calgarygrit, at 5:01 p.m.  

  • Apparently it will take time to get the program up and running properly so they have clarified it will be available starting in 2012.

    By Blogger Ted Betts, at 5:03 p.m.  

  • "Progressive, family-friendly Liberals believe we need to provide extra support so children of low income families can better afford post-secondary education."

    Then why are the majority of the recipients of this money going to be the children of well-off families? Why not just means test it (give the money to poor families)?

    By Blogger french wedding cat, at 5:14 p.m.  

  • It is means tested as $1500 goes to needier families.

    But encouraging post-secondary education and helping all parents with an increasingly expensive problem that hits them just as they are in the lead up to retirement is a good thing. And giving some assistance is a good thing.

    By Blogger Ted Betts, at 5:17 p.m.  

  • It IS means tested. Poorer families will get more money.

    By Blogger LoyalLiberal, at 5:18 p.m.  

  • "It IS means tested. Poorer families will get more money."

    I realize that, but since there are more children of well-off families going to university, and since this grant isn't going to change that radically, the vast majority of this money is going to people that don't need it.

    Why not give $0 to families above 75k, and more money to those below? Why do the kids of say, the McCains or the Irvings need a tuition break that is 2/3rds the size of what you'd give the poorest applicants?

    The answer, is that this policy has little to do with improving accessibility, and everything to do with upper middle class vote-buying. This money will largely go to the present rich, to ensure that their children can become the future-rich. The irony is that Harper's corporate tax cuts are far better for the poor.

    By Blogger french wedding cat, at 5:32 p.m.  

  • Perhaps if this was the communist plan we would do what you suggest. But this is the Liberal Plan. I mean really, you think kids from families making more than 75k are not saddle with a huge debt they struggle with? This is a balanced approach, just like RESPs.

    By Blogger LoyalLiberal, at 6:13 p.m.  

  • From the Liberal e-mail announcement, by Justin Trudeau:

    At a cost of $1 billion in new funding annually, Liberals will pay for this initiative by putting Canadian families at the front of the line, by rolling back the unnecessary $6 billion Conservative corporate tax cut that came into effect this year.

    Honest question: How many billions of dollars of new spending have the Liberals proposed to pay for with that $6 billion so far?

    By Anonymous Anonymous, at 8:13 p.m.  

  • From the Liberal e-mail announcement, by Justin Trudeau:

    At a cost of $1 billion in new funding annually, Liberals will pay for this initiative by putting Canadian families at the front of the line, by rolling back the unnecessary $6 billion Conservative corporate tax cut that came into effect this year.

    Honest question: How many billions of dollars of new spending have the Liberals proposed to pay for with that $6 billion so far?

    By Anonymous Anonymous, at 8:13 p.m.  

  • Despite its imperfections, from a political point of view it seems like a good policy. Generally the older one gets, the more conservative they are thus any Liberal win relies on a strong youth voter turnout. The problem is Ignatieff doesn't have the charisma like JFK, Obama, or Trudeau thus if he wants to motivate more youths to show up on voting day, he needs policies that affect them directly and this seems like one although considering how apathetic most youth voters are I wonder how many actually even know about the announcement.

    By Blogger Miles Lunn, at 9:20 p.m.  

  • More spending. Are they each trying to out-spend each other?

    By Blogger Robert Vollman, at 9:26 p.m.  

  • I'm not that impressed.

    1) From the website: "A reduced amount will also be provided to part-time students." Does that mean part-time students get merely less per-year (i.e. the full $4,000 pro-rated over the course of the studies) or less overall? I don't like the ambiguity. And if you're taking university part-time to spend more time working for pay, you probably need government financial support more than full-time students.

    2) The program wouldn't do much to address skill shortages. Not all educational training will groom people towards occupations that are in demand in Canada. Sure, the future nurses, social workers, and physicists get a break, but so do, say, cinema studies majors. (No offense, cinema studies majors!) A more targeted approach, in partnership with universities, would yield better results overall (such as, I don't know, creating more spaces in high demand programs in which we have national/global shortfalls).

    Obviously I'm not saying we should forbid people from being philosophers instead of gerontologists. If you have a burning desire to devote four years of university to studying gnat feces, go for it! But I think our national government needs to address national problems - and occupational skill shortages is one of those problems.

    3) The program doesn't address the highly variant costs of university. Programs such as engineering and business can be deregulated in many provinces, but these programs tend to create better salaries for their graduates. $1,000 may be a big portion of tuition for regulated programs, but it's a drop in the bucket for these deregulated programs.

    If we want people from lower-income backgrounds to enter university and improve themselves and their families financially, then shouldn't our financial support programs focus on making the cost differences of different programs negligible, so students are picking programs based solely on their interests, aptitudes, and desired future careers?

    By Blogger Unknown, at 9:29 p.m.  

  • Also, did someone make a joke about university students frittering away their Learning Passports on beer and popcorn yet?

    By Blogger Unknown, at 9:41 p.m.  

  • I disagree whole heartedly with you Daniel. The one point I'll make is that I trust students to know which program is best for them. You don't like this great policy in part because you're not sure you're going to like what students pick as their major. Tough luck for you!

    By Blogger LoyalLiberal, at 9:48 p.m.  

  • "I disagree whole heartedly with you Daniel. The one point I'll make is that I trust students to know which program is best for them."

    Because of course, 18-year olds with no life experience, and no inclination to seek out relevant data (how many people looked up data, wage data other than that provided by universities themselves when applying) are the kinds of decision makers we want to back with billions of dollars of taxpayer funds. There is a direct connection between university students saying "I don't know what I want to do with my life" and people later saying "my sociology degree hasn't made me a better assistant manager at Burger King"?

    When we ensure that students are spending other people's money, we accentuate that tendency.

    By Blogger french wedding cat, at 10:27 p.m.  

  • Honest question: How many billions of dollars of new spending have the Liberals proposed to pay for with that $6 billion so far?

    1 billion for this. 1 billion for Family Care.

    To the best of my knowledge, that's all that's been announced so far, though a few others (Child Care, pension reform) have been hinted at.

    By Blogger calgarygrit, at 10:47 p.m.  

  • Daniel - ha ha. I'd say even odds we get some sort of "beer and popcorn" type moment out of this.

    By Blogger calgarygrit, at 10:48 p.m.  

  • Could someone explain to me how money put aside to high school students to be used in future years is described as "It is money and assistance right now, not 4 years from now."?

    Plus, people who only go to 1 or 2 year programs (Like most real skill programs, not artsy feel-good degrees) won't get the full benefit.

    Also, they say the benifit is tax free, but withdrawals from an RESP that are above the original contributions area taxed in the students hands. So if they are working and putting themselves through school they may get a nasty surprise tax bill. It's not really explained in the page linked in the article.

    P.S. The linked article states in it's FAQ "The Learning Passport is intended for future students going into college and university." . . . that sure sounds like 'assistance right now'.

    By Blogger Traciatim, at 6:30 a.m.  

  • Traciatim:

    1. It is now because, if you are about to go to school or are in school now, you will get the assistance. Starting in the fall of 2011. Not 5, 6, 7 or (more likely) more, if you even qualify and are wealthy enough, like the income splitting "promise".

    2. It is educational assistance, not free money, so if you only go into a 2 year program, you only need 2 years of educational assistance. You get the same assistance and everyone else.

    3. It is tax free because the assistance will not be considered income. The federal government can decide what to include as income and what not so you are kinda inventing problems here that don't exist. It's fully explained in the page linked in the article.

    You are welcome.

    By Blogger Ted Betts, at 8:53 a.m.  

  • 1. It says right in the article that they haven't come up with the assistance plan during the transition period for current students, and that the plan is only for future students. If the plan starts in 2012, the first payments wouldn't be able to be used until 2013 and the first full payments wouldn't be until 2016. I still don't see how that can be twisted as 'now'.

    2. Calling it education assistance seems to imply that the withdrawals will be part of the EAP from the RESP which are taxed in the hands of the student. It's not clear, but it seems similar to the RESP income deductions proposed last election that simply shifted the tax from the depositor to the student. At least with the previous proposal the student still kept their credits to offset the increased tax bill.

    3. They have only declared the deposit is not taxed on receipt. You are inferring it is not taxed on withdrawal, but it's not clear from the linked article. I can only assume (from all political parties, not just the liberals) that if it is not explicitly stated it has either not been thought of or the news isn't good.

    By Blogger Traciatim, at 11:35 a.m.  

  • 1. As part of the announcement and in Q&A, they confirmed existing students will be able to get it starting in the fall 2011.

    2. As part of the announcement and in Q&A, they confirmed that the $1000 will not be treated as "income" for tax purposes.

    3. It's not income. Only income can be taxed. So they don't need to say that it is not income when credited, deposited, withdrawn, whatever. If it's not income, it's not taxed.

    By Blogger Ted Betts, at 12:14 p.m.  

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