Ross Marchand writes for the Martin Center about state governments’ role in limiting college costs.

The coronavirus pandemic may be nearing its end, but that does not mean a return to normal in all cases. Even before the virus pushed classes out of the physical classroom to online, America’s system of colleges and universities was spiraling out of control with high costs and stagnant innovation. Every year, families about to send their kids off to college face sticker-shock with high tuition bills.

The Atlantic contributor Amanda Ripley noted in 2018 “the U.S. spends more on college than almost any other country… All told, including the contributions of individual families and the government…, Americans spend about $30,000 per student a year.” The temporary euphoria created by resumed in-person classes cannot make up for these massive cost problems.

Ultimately, it is up to policymakers to reform the higher education system and encourage competition and innovation. Costs can stay under control, but only if there is a serious reevaluation of the status-quo.

Although there have been plenty of appeals to federal and state governments to “do something” about rising college costs, these calls to action usually result in taxpayers footing more of the bill for higher education. This may succeed temporarily in maintaining the illusion of low tuition, but in reality, the public is still paying for college credits via higher tax bills. And workers who choose to forgo college and work in a trade are forced to subsidize (often richer) families who want to send all their children to four-year institutions.

The largest problem with never-ending subsidization, though, is how government-backed loans drive up the level of tuition that universities charge.

This is not a new phenomenon. In 1987, then-Secretary of Education William Bennett concluded from the data, “increases in financial aid in recent years have enabled colleges and universities blithely to increase their tuitions, confident that Federal loan subsidies would help cushion the increase.”

More recent analyses have confirmed this idea, now known as the “Bennett Hypothesis.”