Rent seeking with your money

There is something profoundly wrong with society when people use taxpayers’ money to lobby for an increase in their own funding – ie: to lobby for an increase in taxpayer funding. Perhaps it is not surprising – it happens quite a lot nowadays. Take the latest example of a $5 million campaign by the taxpayer-funded Universities Australia to increase both university funding and taxes.

The chairman of Universities Australia, Glyn Davis, might passionately believe that taxes should increase – but let him first contribute some voluntary tax from his $1 million package as vice-chancellor of Melbourne University.

Personally I think there is more than enough money sloshing around universities. It just needs to be better prioritised and more wisely spent. Increasing entry barriers (student fees and entrance standards) would be one area of reform – I’ve already argued that too many people go to university. Then we should close down some faculties that do not add value: journalism being at the top of that list. Nursing, too, should not be a university degree. Since all of these qualifications are a net cost to the taxpayer (student fees are a small fraction), it should be relatively easy for a persuasive and strong vice chancellor like Davis to weed out the junk from his university. Next he could go after some of the academics and administrative staff who treat university as a long vacation.

Most managers of private companies on salaries like Davis don’t immediately think of increasing prices when their competitors (overseas and increasingly online) are already less expensive.

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