By Paul Bowles
Budget speeches are typically full of numbers and rhetoric, but underneath they reveal political choices. They tell us about what priorities the government has and what government thinks its role is in the economy. So what does the 2010 B.C. budget tell us?
Let’s start with the priorities and, in particular, where postsecondary education lies. The figures announced in the budget essentially show that universities and colleges will be receiving the same number of dollars in each of the next three years. The government calls this “stable” funding and “protecting” education. In fact, it is neither. It actually means cuts. Postsecondary institutions may get the same number of dollars each year, but their costs keep rising. The costs of the things that universities buy, like technology, library acquisitions, and software licensing agreements, all increase year after year and typically by more than the rate of consumer price inflation. That’s why in the United States they use a special index, the Higher Education Price Index, to more accurately measure the cost pressures in the higher education sector.
The fact that funding is frozen, but costs will inevitably go up over the next three years, means that universities will have to find savings from somewhere. This typically means bigger classes, less support for students, and fewer new faculty positions. Despite years of seeing increasing student numbers and rising costs eat away at educational quality, the belt-tightening at universities across the province will continue. And there isn’t any light at the end of the tunnel. The government has said that when it gets back to a balanced budget, any surpluses will be used to pay down the debt.
So, if you want to know what the budget says about where postsecondary education sits on the government’s priority list, it is well below deficit reduction and debt repayment. These fiscal measures are of greater importance to government than the need to preserve and increase the quality of the province’s postsecondary education.
That also tells us a good deal about what the government thinks its role is in the economy. Its mantra is that B.C.’s “competitive advantage”, as it likes to call it, is in lower taxes and balanced budgets. Despite the fact that the global economic crisis has shaken the belief in the efficacy of these free market, minimal government approaches just about everywhere else, our provincial government clings to the belief that all will be well if it keeps taxes low and doesn’t run a deficit. The collapse in revenues has blown government off course a bit, but its priority is to get “back to normal” as quickly as possible.
With governments committed to this approach, postsecondary education is always going to be struggling. Economist Milton Friedman became famous for saying that “there is no such thing as a free lunch”. With respect to postsecondary education, he is actually right. If you want a high-quality, accessible public postsecondary education system, then you have to pay for it. The idea that you can have low tax rates and high-quality public postsecondary education requires a very high rate of economic growth. More typically, if you want good-quality public services, as in the Scandinavian countries for example, then you need higher tax rates to pay for these superior services.
And therein lies the problem for postsecondary education in B.C. Successive governments have been elected promising to cut taxes. The result has been that over the past two to three decades, the proportion of provincial GDP collected as tax revenue has fallen from around 20 percent to around 15 percent. At the same time, federal transfers have also been reduced. The result is fewer resources to fund public services including postsecondary education.
So, the message from the March 2 budget was to brace our postsecondary institutions for more belt tightening and don’t expect a change anytime soon. If we continue to believe that B.C.’s “competitive advantage” can only be built on low taxes, then we are doomed to a struggling postsecondary education sector and diminished public services.
Paul Bowles is the president of the Confederation of University Faculty Associations of British Columbia.