Free College increases education inequality – wealth prioritization, solely tuition covered, and public college crowd out are all major causes.

Contrary to their reputation as “progressive,” free college programs overwhelmingly allocate taxpayer dollars toward upper- and upper-middle-class students, giving them a further head start than they already have in the higher education system. The worst offenders are “last dollar” programs (see Appendix for details on types of free college programs), which pay for the tuition balance that remains after all other grants have been applied. Ultimately, that means picking up a bigger check for students who don’t qualify for need-based aid, like a federal Pell Grant. For example, if two students attend college—one a low-income student receiving a Pell Grant and the other a wealthy student not receiving any other financial aid—tax dollars from the free college plan would flow to the wealthy student (who is already more likely to go to college in the first place and be able to afford it) because they will have greater tuition expenses not already covered by existing aid.

This becomes a big problem when you add up all the money being spent on these programs. One analysis of a federal free college proposal found that families from the top half of the income distribution would receive 24% more in dollar value from eliminating tuition than students from the lower half of the income distribution.5 While targeted programs like the Pell Grant were meant to increase access and make college more affordable for low-income students, free college programs would overwhelming direct tax dollars to subsidize the college tuition of those whose income is too high to make them eligible for need-based aid—proving that what sounds like equality does not always provide true equity.

2. Most free college programs don’t address the real costs of college.

With the rhetoric surrounding rising tuition costs, an easy fix sounds like eliminating tuition altogether. Surely that would solve the problem, right? Wrong. That’s because tuition isn’t the only driver of college affordability. For this school year alone, tuition and fees make up only 48% of the total costs a student pays to attend a four-year public institution.6 One recent study in California showed that while the state has done a good job at keeping tuition affordable through financial aid, low-income students were still struggling with paying the costs of living like housing, food, textbooks, and transportation.7 That’s why it is estimated that simply eliminating tuition expenses would still leave low-income students with $17.8 billion in unmet need for living expenses—the real cost of college for the majority of students.8

Before the introduction of the Tennessee Promise free community college program, on average a low-income student had more than $7,000 in unmet need due to non-tuition costs because often low-income students at community colleges have most—if not all—of their tuition covered by their Pell Grant.9 Rather than using state tax dollars to provide cost of living subsidies to meet those needs, the program instead provided a $1,500 benefit in state tax dollars to higher-income students. New York’s Excelsior program—their version of free two- and four-year college—also failed to address the living costs associated with going to college (though it did less to help high-income students because it had an income cap).10

3. Free college programs could actually restrict access for low-income students.

Lastly, while the intent of free college is to increase access for low-income students, it can have the opposite effect. Free college programs may impact where students choose to enroll, making them more likely to attend schools that might not serve them well or push them out of the schools likely to give them their best shot at success. For example, free college programs designed only for community colleges may discourage low-income students from attending a four-year school, even if they are academically qualified to do so. New research out of Princeton University and the University of Chicago has shown that diverted students—those who would’ve otherwise enrolled in four-year schools but instead enrolled in two-year schools—end up with worse outcomes, including being 18 percentage points less likely to complete a four-year degree compared to directly enrolling in a four-year school.12

And that can be problematic in the long run, as the wage premium of a four-year degree is greater than $14,000 more per year and $900,000 more over the course of a lifetime than a two-year degree, which means this diversion is ultimately setting low-income students back, not helping them succeed.13 Even for those who plan to start at community college to save money and then transfer to a four-year college down the line, data shows that transfer students on average lose 43% of credits during the transfer process.14 That means if those students would have otherwise attended a four-year college to begin with, they may be at risk of losing credits and taking longer to complete—leaving them with a bigger bill to foot in the end.

We already have a problem where students have limited access to attend college. Most students attend college within 50 miles of home and yet 35 million people live in education deserts, an area where there are either zero or only one public broad-access college nearby.15 Enacting free college could make limited public institutions even more selective, putting students who would normally attend them at risk of not being admitted because more high-income students are choosing public institutions instead of private. This “crowding out” effect could push out 20% of low-income students of these public institutions if free college was enacted.16