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The US Granted Free Tuition Before, and It Can Do It Again

The College for All Act would free up billions of dollars tied up in tuition and student loan payments.

A crowd of veterans wait their turn to get counsel on schooling on the last day to file papers under the G.I. Bill in New York on July 25, 1951.

When Sen. Bernie Sanders and Rep. Pramila Jayapal submitted joint bills for the College for All Act in Congress last June, it sparked joy among the nearly 20 million attending or planning to attend public universities and colleges, not to mention their families. But even such a reaction had to pale compared to the celebration by 45 million past defaulters and present eligible holders of federal student loans that the bill would “forgive,” student debt in addition to providing completely free tuition and fees at public institutions of higher education.

However, the joint bills also drew immediate jeers from conservative economists, pundits, Congress members and the media, and even opposition from Democratic presidential candidate Pete Buttigieg. It also raised eyebrows among those at the U.S. Treasury and among presidents of the nation’s exclusive colleges and universities.

But that opposition was simply a newer iteration of the same scorn and fear from 75 years ago when these same constituencies fought the passage of the G.I. Bill of Rights, otherwise known as the Servicemen’s Readjustment Act of 1944, signed into law June 22, 1944, by President Franklin D. Roosevelt.

President Franklin D. Roosevelt and his administration recognized that at the end of World War II, some 16 million returning soldiers would join the millions of the Great Depression’s unemployed. To keep most out of the labor market for at least four years, the bill’s education and vocational training section was designed to provide not only around $7,300 (in 2019 dollars) for tuition at any school, but also cover other chief expenses: books, supplies, equipment, and other necessities, exclusive of board, lodging, travel, and other living expenses. The bill also provided a monthly living allowance of $730.50 (in 2019 dollars).

The First G.I. Bill

The original G.I. Bill was an immediate gold mine for public and private colleges and universities from 1946-51. To cover the flood of veterans inundating localities, nearly $138 billion (in 2019 dollars) had given a college education in 1951 to over 2.3 million veterans.

Government funding for veterans’ education also saved institutions additional costs, such as wages for new faculty and staff, but also major capital expenses, such as class and lab buildings, and veterans’ housing. The Pentagon donated, delivered and set up surplus buildings (some for family quarters) and labor to fill those needs. The institutions’ only obligations were providing land, utility hookups and maintenance. Classes were so overcrowded at some colleges that schools such as Iowa State held sections from 7:30 am to 10:30 pm.

Despite this guaranteed bonanza, thousands of academic purists initially agreed with University of Chicago President Robert Maynard Hutchins that, “Education is not a device for coping with mass unemployment…. Colleges and universities will find themselves converted into educational hobo jungles.”

But such elitist attitudes regarding the masses’ educational attainment was certainly not the case for thousands of other presidents of accredited institutions, since many then envisioned these incoming veterans as future alumni who would help to cover institutional overhead costs through alumni donations. As of 2017, these gifts still constitute more than 26 percent of contributions to public and private colleges and universities.

For instance, when the University of South Carolina’s regular enrollment of about 1,500 ballooned with 3,000 veterans enrolled in 1946, its president saw a huge budget increase from the federally paid $7,300 tuition (in 2019 dollars) and other expenses, and an additional windfall of millions in alumni donations from at least 2,000 grateful and loyal G.I. Bill veterans.

Economic Returns Redoubled

The taxpayers’ return on investment in educating veterans has “doubled and has redoubled ever since,” President Lyndon B. Johnson emphasized 20 years later when signing the first extension of the G.I. Bill. For one thing, a degree raised a veteran’s worth and wages in the workplace, leading one research historian to note that, “Veterans who completed a college degree or some type of vocational training gained … $10,000 to $15,000 annually when compared with those who [did] not. The increase in salaries generated tax revenue that paid for the program 8 to 10 times over, often being referred to as ‘the best investment the U.S. government ever made.’”

Almost 8 million veterans — nearly half of all those who served in World War II — used the G.I. Bill. Author and G.I. Bill expert Edward Humes noted that among the distinguished were “14 Nobel prize winners, three presidents [Gerald Ford, Richard Nixon, George H.W. Bush], 12 senators, 24 Pulitzer Prize winners, 238,000 teachers, 91,000 scientists, 67,000 doctors, 450,000 engineers, 240,000 accountants, 17,000 journalists, 22,000 dentists and millions of lawyers, nurses, artists, actors, writers, pilots and entrepreneurs.”

President Johnson also praised the positive economic contributions of ordinary G.I.s, especially the millions lifted out of Great Depression poverty. One history scholar observed that the first G.I. Bill “sparked an economical and educational bounce that continues to affect the United States even today.”

In 2017, the latest version — with some major changes — honored the creator of the first G.I. Bill: The Harry W. Colmery Veterans Educational Assistance Act. Nicknamed the “Forever G.I. Bill,” it has no deadline for using benefits, including 95 percent of housing costs and scholarships for surviving spouses and children.

A G.I. Bill for All

The original G.I. Bill capitulated deeply to the racist dictates of Jim Crow, and historians have documented the many ways in which Black veterans were dissuaded and excluded from accessing its benefits. As Brandon Weber writes in The Progressive:

Many African Americans who served in World War II never saw these benefits. This was especially true in the south, where Jim Crow laws excluded black students from “white” schools, and poor black colleges struggled to respond to the rise in demand from returning veterans. But those exclusions were by no means limited to states South of the Mason-Dixon line—or to education. Historian Ira Katznelson has documented how and why black Americans have received far less assistance from social programs than white Americans, and argues that the G.I bill was deliberately designed to accommodate Jim Crow laws. He cites a study declaring it was “as though the GI Bill had been earmarked ‘For White Veterans Only.’ ”

What we need to fight for now is not a replica of these exclusionary dynamics but instead a true G.I. Bill for All that takes care not to copy the original bill’s egregious racist and exclusionary application.

Too many of this year’s 3.7 million high school seniors won’t be able to afford today’s average annual tuition at an in-state public college ($10,116). Few may have “full-ride” scholarships or modest grants. Working-class families have little disposable income today to help cover tuition, much less school supplies. Driven by desperation, most students will be forced to take on staggering post-graduation debt. Today’s average federal student loan is $35,359 at 4.5 percent interest, with monthly payments of around $300.

What happens to a nation’s economy when 42 million present and past borrowers find that they cannot afford cars, homes and furnishings, or to start businesses as G.I. students did? Such belt-tightening instantly impacts profits for service providers, their suppliers, investors and banks.

Colleges and universities are equally eligible for closure too when they become unaffordable for most Americans. This is already happening. Foundation officials are alarmed at the continuing and widespread drop in alumni donations, for instance. Surely alumni paying $300 per month for 10 to 20 years on that average $35,359 student loan undoubtedly already consider that sum to be their “lifetime donation.”

Small wonder that a 2019 survey shows 60 percent of Americans want tuition-free public colleges and universities. They and millions of students and their families know a degree is not a luxury, but often an essential credential for starting-level employment. That may explain why it has become a top issue in the current election campaign. Still, for many, the question remains: Can we afford to finance it? The answer is a resounding yes.

If the Sanders-Jayapal joint bill becomes law, future benefits to this country from free tuition could replicate those of G.I. Bill recipients. For one thing, a Levy Economics Institute 2018 study conclusion about debt cancellation alone indicates that the College for All Act would free up billions now spent on tuition and student-loan payments. It is true that some dollars will be put into savings — especially if students have other means of support — but much would be immediately directed into goods and services. Sellers, in turn, would be taxed on the profits, thus refilling U.S. Treasury revenues.

A Georgetown University think-tank report about jobs in this decade noted that 65 percent of them will require at least a bachelor’s degree and could provide a $1 million income over a lifetime in upscale careers. In addition to higher state and federal tax revenues, the report noted an increased productivity and “faster economic growth.” Aside from those economic benefits, other by-products of having that degree are that the “better educated tend to have better health, higher rates of civic engagement, lower crime rates and greater rates of expressed satisfaction and happiness.”

Perhaps the strongest, most definitive projection of future benefits to the nation came last June when over 100 academics — mostly from public institutions around the country — wrote Congress they were “wholeheartedly” endorsing the joint bill’s passage. In addition to citing the Levy Economics Institute study, the authors of the letter noted:

Other research has found that cancelling all student loan debt would reduce the racial wealth gap from 12:1 in 2016 to 5:1, helping to redress long-term racial injustices…. These [two] groundbreaking bills offer a path out of our current mess. They would benefit the entire economy, improving life not only for those who will feel immediate relief as borrowers, current students, and their loved ones. Retailers will enjoy higher consumer demand as debt cancellation frees up an average of $3,000 per year (or $250 per month) to be spent in other ways. That means greater liberty to start a business, buy a home, or deal with other unmet needs. It means freedom for those who are collectively trapped under the weight of $1.6 trillion in debt, and it means a more prosperous economy for us all.

Moreover, the federal government is being repaid for the much-cited balance of $1.6 trillion in past and present student loans. Taxpayer dollars aren’t going to be lost by the Senate bill’s provision cancelling the debt. It is to be covered by a small, applicable tax on buying or selling transactions in the stock markets: 0.5 percent on stocks, 0.1 percent on bonds and 0.005 percent on derivatives. Sanders has estimated the tax yield would be $2 trillion within a decade, but a 2017 University of Massachusetts study puts it at $2.4 trillion. Leftover funds could be applied to the bill’s request of $1.3 billion to cover first-year’s tuition.

Add the fact that in 2018, the federal government earned $85 billion in principal, interest and fees from present and former student-loan borrowers. In fiscal year 2015 alone, the government recovered $4.5 billion in defaults. Interestingly, part came from 114,000 people now on Social Security who had 15 percent of their monthly checks garnished. That’s because in Lockhart v. U.S. the U.S. Supreme Court ruled unanimously that the statute of limitations didn’t apply to Social Security payments if the borrower has been in default for over 10 years.

In view of the G.I. Bill precedent for free tuition and other benefits, as well as its monumental payback to this country’s well-being — and overwhelming public bipartisan support since Sanders’s platform plank in the 2016 election for free tuition at public institutions — the question is why the joint bill remains bottled up in committees. And why Sanders’s version of the bill lacks co-sponsors in the Senate while Jayapal’s has only 19 co-sponsors in the House. After all, that first-year requested allocation is still just a fraction of the nearly $138 billion (in 2019 dollars) spent for the first three years of the G.I. Bill.

One explanation appears to be strong pressure on lawmakers by the military-industrial complex over the Pentagon’s continuing recruiting shortages — despite the military’s offer of $40,000 bonuses and student-loan payoffs. As Truthout contributor Rory Fanning wrote recently, “Most elected officials understand that if college were free, then the pool of potential military recruits would plummet … [and] thousands of soldiers would lose their incentive to stay in the military — a huge threat to the U.S. war machine.”

Elitism Fuels Bill’s Opposition

Beyond Pentagon pressure, however, the main reason Congress is taking no action on the bill so far points to classism, pure and simple. It seems the “hobo-jungle” remark continues to have influence. So does the preposterous claim that free tuition will “dumb-down” courses or “cheapen” a bachelor’s degree.

Then there is Buttigieg’s inane comment about barring children of millionaires or billionaires from free tuition at public institutions. As a Harvard and Oxford liberal arts bachelor’s degree holder, the Democratic presidential contender knows that almost all offspring of the wealthy, powerful, or influential attend private and exclusionary colleges and universities.

Then consider that nearly 40 percent of the current Congress are millionaires, or that their families covered all their college expenses. That may make it difficult to identify or empathize with those trying to rise above their “assigned station” in life by earning a degree.

The cruel and wasteful truth is that throughout recorded history, the ruling classes have made every attempt to deny education to the masses, lest they rise to become equals, demanding a share of power, prestige — and pay. Being superior depends on having inferiors doing day-to-day drudgery in fields or factories, turning out the profitable goods and services for well-born owners. God forbid “common people” learn about Karl Marx, John Maynard Keynes, Walter Reuther, or engineering and chemistry.

In colonial America, the same elitist position remained fixed until 1639, when taxpayers of Dorchester, Massachusetts, financed the Mather Elementary School. Later, in 1847, a New York State tax referendum established the first tuition-free public university, the all-male Free Academy (part of today’s City University of New York system). The Academy was to be “controlled by the popular will, not by the privileged few.” On opening day, founder Townsend Harris uttered the timeless credo of public colleges and universities: “Let the children of the rich and poor take their seats together and know of no distinction save that of industry, good conduct and intellect.”

Fearing this movement’s spread across the country, the privileged fought Republican Vermont Sen. Justin Smith Morrill’s 1862 land-grant bill. A blacksmith’s son, Morrill’s lifelong mission was to endow every state with a free public university — especially for the “sons of toil” and to promote “education of the industrial classes.” These institutions were artfully financed by granting each congressional senator and representative 30,000 acres of federal land to sell as endowment vehicles.

In short, today’s congressional elitists appear to be even more threatened by the joint bill for free tuition than their predecessors were over the first G.I. Bill. They don’t seem to realize these students will be attending public colleges and universities, not “invading” their exclusive private enclaves, or that the lower class once again will be doing the heavy lifting to get this country back on its feet.

Indeed, by being debt- and tuition-free, the working class will begin to put their savings to work almost immediately by buying goods and services. But like those G.I. Bill benefactors, many will likely be putting most aside for buying homes and new products, and starting businesses — investments all doubling and tripling the return to this country’s economy.

President Johnson’s praise for those first G.I. Bill graduates is equally applicable to future contributions to the nation. Congress and presidents investing in higher education for ordinary people will reaffirm, as he said, “America’s commitment to develop the resources of her people, thus laying the firmest possible foundation for the building of a free, vital, and progressive society.”

Note: This article has been updated to include information about racial disparities in accessing the benefits promised by the original G.I. Bill.