Thursday, January 18, 2007

The Hidden Costs of Socialism

I’m still a college student, and I found myself this semester retaking a Precalculus class that I had begun a couple of years ago but had to pull out of, largely for military reasons. I was pleased, upon reading the syllabus, to see that the same book that I had used for the previous class was still assigned; it would save me having to purchase another $100 textbook. I wasn’t sure whether the same edition was still being used (the syllabus didn’t specify), but I figured I would give it a shot; even if the edition I had was out of date, I figured it would be usable. After all, how much could mathematics have changed in a couple of years?

Everything was going fine until I got about halfway done with my homework and realized that several problems were assigned that did not exist in my text. Frustrated, I went to Morris to check out the current edition from the Reserve room. The answer to the question of how much mathematics had changed in a couple of years was not much; there was very little difference between the readings portion of the two texts. In fact, the only difference I noticed was the removal of a tidbit I had thought interesting about the origin of the word “Algebra.”

The Exercises portion, however, was another story. It was completely different from what was in my old text. Problems had been added, existing problems had been moved; sometimes the only noticeable change was that the problem sections had been rearranged and renumbered. Why? Was the new format somehow superior to the old, aside from the additional problems? No; it was about the same, just reworded and renumbered. Why then? For one purpose: to stiff poor college students like myself.

It’s a cute trick; leave the text substantially alone, but rearrange the exercises in order to instantly outdate the old textbook and force students to buy the expensive new edition instead of purchasing the old one used. It’s particularly transparent in mathematics, where (at least on the undergraduate level) things change so slowly that publishing a new edition every two years is patently silly. But it’s a trick that is used throughout the massively profitable textbook publishing system. Publish a new edition, discontinue the old edition, and rearrange things sufficiently so that the old edition is incompatible with the new. This bit of skullduggery, along with the exorbitant price of textbooks, combine to jilt college students out of millions of dollars every year.

How is this possible? How is it that in a free-market economy where it seems that nearly every other commodity or service seems to get better and/or cheaper over time, can textbook publishing be stuck in this Dark Ages cycle of ripoffs and exploitation?

The answer, oddly enough, would seem to be socialism. In particular, socialist colleges and universities. “Huh?” you might ask. “What socialist universities?” There’s one right before your eyes. I attend one. SIUC is a state-owned, and therefore socialist, school. Its tuition rates are subsidized, particularly for state residents, so that its tuition rates are substantially below market rates for a comparable education.

So how are state schools responsible for textbook prices? Simple: socialist schools have no incentive to keep costs low for their students. Their tuition rates are already low, so they can expect high enrollment even if they heap other, hidden costs on the students (although SIUC, amazingly, seems to be doing a horrible job at enrollment, even so). What’s more, the low price of state schools removes poorer students from the free market for higher education, so that (except for the intellectual cream) private schools rarely even attempt to entice them. This results in reduced price competition between private schools. Someone who is paying $20,000 a semester (or whatever it is now) to attend MIT is unlikely to balk at a $500 textbook bill.

If state schools did not exist, low-cost private schools would spring up in their place, and (given the magic of the free market) would likely be providing a superior education at equivalent or lesser cost within a few years. What’s more, a free market in education would tend to solve the textbook problem. If schools could compete freely for the poorer students, textbook cost would likely become a factor.

And the solution to the textbook problem is astonishingly simple: Textbook cost should be counted as part of tuition. Students don’t pay room-rental fees for their classrooms; they don’t pay electricity fees for the energy they use while in class. All of that and more are part of the cost of tuition. If textbooks as well were considered as part of this cost by a majority or substantial minority of schools, textbook prices would plummet. Why? Because schools, trying to minimize their textbook cost, would press professors to choose cheaper texts, and those that are not updated more often than necessary. A market for cheaper textbooks would spring up, and publishers would move to fill that market. In fairly short order, this ridiculous stranglehold publishing companies have over students would be abolished. As of now, there is no market for cheaper textbooks. Sure, you want a cheaper textbook, but you are not the one who chooses the textbook you have to buy; your professor is. And your professor is not the one who has to pay for it, so he will rationalize the cost to himself, and you are, once again, screwed.

So remember: The next time you think government would do a better job than the market at providing some service or good, don’t forget the hidden costs.

Posted by Calion to Carbondale Bytelife at 1/18/2007 8:12:46 PM