QUESTION: Mr. Armstrong; What do you think about Bernie Sanders saying education should be free? Is this socialism or doable?
ANSWER:The two areas that constantly rise in price are education and health care. Both are a total disaster because the government subsidizes them.
Bernie’s idea of free education sounds nice. However, it will fail and constitute Marxist socialism if it simply seeks to pay the educators and institutions their current price, as that would bankrupt the state completely. The idea is admirable. The only way to accomplish this is NOT to subsidize the current system. You must eliminate what the Clinton’s did to students and restore their right to file bankruptcy. Give them the right to sue a university if they cannot find employment with the degree they went to school for.
You have state-run universities. To inject competition, decree that whatever a parent or student pays for their education is tax-deductible from all taxation from Federal to local. If the educators must compete against the rest of government for their share of the taxes,costs will be kept in line.
Look at health care. In the 1980s, our company provided full health care to employees and their families. The cost was typically well under $2,000 annually. Obamacare made health care costs much higher. Whatever they name an act, the result is the opposite.
It sounds nice to provide people with free education, but that subsidizes the industry and eliminates the checks and balances needed to ensure it is in sync with the business cycle. It is insane that the only two industries that constantly rise in price against the trend are education and health care.