Education in the Free Market

Posted by Nathaniel Peters on February 21, 2008, 4:34 PM

According to today’s New York Times, Stanford is waiving its $36,030 tuition for families earning under $100,000 a year, and waiving the $11,182 room and board fee for families earning under $60,000 as well. Last summer Stanford–with over $17 billion, the third-largest university endowment in America–increased its endowment spending to 5.5%, more than Harvard, Yale, and other schools in its class. With the new fee reductions announced today, Stanford is now spending $114 million on financial aid every year.

On one hand, Stanford’s announcement could be interpreted as a sign of success for those who want Congress to force universities to spend more of their endowments. After all, this announcement has come after saber-rattling from the Senate Finance Committee. But Stanford had already been spending more than the 5% of its endowment that the Finance Committee demanded, so it is unlikely that its increase in aid is a desire to preempt any governmental regulations.

Instead, Stanford’s increase in endowment spending and financial aid can be attributed to one thing: the desire to compete with its peers for the best students. Which goes to show that the government need not micromanage the budgets of universities in order to get them to lower their tuition. The free market of education can take care of itself just fine.

Too bloody late?

Posted by Amanda Shaw on February 21, 2008, 10:30 AM

No health insurance premiums, no copays, no deductibles, and no coverage limits. I grew up under the care of military medicine—Balboa and Bethesda naval hospitals—and from the perspective of the pocketbook, free health care is rather nice. Then, as a college student I spent a semester in England and was much relieved to learn that I was eligible for National Health Services. No logisitics to worry about; more money for excursions and Oxfam. Maybe there’s something to socialized medicine after all.

Or maybe I’d sing a different tune if I’d actually gotten sick. A New York Times article today points out just one flaw in the system’s policy. Here’s the beginning:

Created 60 years ago as a cornerstone of the British welfare state, the National Health Service is devoted to the principle of free medical care for everyone. But recently it has been wrestling with a problem its founders never anticipated: how to handle patients with complex illnesses who want to pay for parts of their treatment while receiving the rest free from the health service.

Although the government is reluctant to discuss the issue, hopscotching back and forth between private and public care has long been standard here for those who can afford it. But a few recent cases have exposed fundamental contradictions between policy and practice in the system, and tested its founding philosophy to its very limits.

One such case was Debbie Hirst’s. Her breast cancer had metastasized, and the health service would not provide her with Avastin, a drug that is widely used in the United States and Europe to keep such cancers at bay. So, with her oncologist’s support, she decided last year to try to pay the $120,000 cost herself, while continuing with the rest of her publicly financed treatment.

Only, she wasn’t allowed to—told that if she financed part of her care independently, she’d be ineligible for tax-payer funded services:

Officials said that allowing Mrs. Hirst and others like her to pay for extra drugs to supplement government care would violate the philosophy of the health service by giving richer patients an unfair advantage over poorer ones.

Patients “cannot, in one episode of treatment, be treated on the N.H.S. and then allowed, as part of the same episode and the same treatment, to pay money for more drugs,” the health secretary, Alan Johnson, told Parliament.

“That way lies the end of the founding principles of the N.H.S.,” Mr. Johnson said.

Perhaps, then, Debbie Hirst’s problem is not just a policy glitch. Perhaps it goes to the root of the centralized health-care philosophy. To tell the truth, Ms. Hirst is now receiving her Avastin free from the N.H.S.—not because she won the argument, but because her cancer has worsened. She’s not exactly thrilled: “It may be too bloody late.”

Islamism Doesn’t Win

Posted by Nathaniel Peters on February 21, 2008, 10:11 AM

In today’s Wall Street Journal, Amir Taheri argues that the Pakistani election delivered a loss to more than just Pervez Musharraf: The Islamist parties failed to garner votes despite intense campaigning. This is but the most recent defeat for Islamist political parties, and that is good news for those seeking democracy in Muslim countries. Taheri writes:

The Islamist defeat in Pakistani confirms a trend that’s been under way for years. Conventional wisdom had it that the wars in Afghanistan and Iraq, and the lack of progress in the Israel-Palestine conflict, would provide radical Islamists with a springboard from which to seize power through elections.

Analysts in the West used that prospect to argue against the Bush Doctrine of spreading democracy in the Middle East. These analysts argued that Muslims were not ready for democracy, and that elections would only translate into victory for hard-line Islamists.

The facts tell a different story. So far, no Islamist party has managed to win a majority of the popular vote in any of the Muslim countries where reasonably clean elections are held. If anything, the Islamist share of the vote has been declining across the board.

Far from rejecting democracy because it is supposed to be “alien,” or using it as a means of creating totalitarian Islamist systems, a majority of Muslims have repeatedly shown that they like elections, and would love to join the global mainstream of democratization. President Bush is right to emphasize the importance of holding free and fair elections in all Muslim majority countries.

Tyrants fear free and fair elections, a fact illustrated by the Khomeinist regime’s efforts to fix the outcome of next month’s poll in Iran by pre-selecting the candidates. Support for democratic movements in the Muslim world remains the only credible strategy for winning the war against terror.

The full article is here.