Higher education is essential. It’s also unaffordable. Both of these realities are hard to ignore.

Few can deny that a college degree offers a path to a better-paying job and greater employment security. On average, workers with no college education earn only about 60% as much as those with a bachelor’s degree, and they typically face an unemployment rate that is nearly twice as large. But a bachelor’s degree is expensive. Four years of tuition at a public university in Maine will cost a student nearly $35,000, even if they live at home and commute to school. Did I mention that this is the cheap option? The average cost of attending a private college is nearly four times larger.

Few students can afford this cost on their own, so many take on substantial amounts of debt to go to school. This can be a wise investment — the wage premium of a college degree can cover these costs and still put students out ahead — but it pushes the cost of a degree even higher, discouraging many students from pursuing one.

This may explain why only 36% of Mainers above the age of 25 have completed a bachelor’s degree. Although the cost of college is a national problem, educational attainment is lower here than in many other states. For example, 47% have a bachelor’s degree in Massachusetts, and every other state in New England has relatively more college graduates than Maine as well.

This doesn’t just hurt the individuals who miss out on better economic opportunities, it costs all of us who live in Maine. This is because the benefits of education are not just enjoyed by the individuals who receive it, but they extend to society as a whole, too. An economy with a better-educated workforce will be better able to attract and retain businesses — especially those that offer good, high-paying jobs. It will also generate faster rates of economic growth and non-economic benefits, such as lower rates of crime and better health.

Market forces are leading us to an outcome that is socially suboptimal. Many people choose not to pursue higher education because the costs are so high, even though society as a whole would benefit if they did. Economists have a term for situations like this — market failure. They also have a solution — having the government cover part of the costs.

Lawmakers in Maine have proposed a policy that would do just that. They are currently considering a bill that would help to lower costs for students who attend one of Maine’s public universities. It would cover up to 50% of tuition expenses for up to four years to make higher education more affordable for Mainers graduating from high school. It would also cover up to 50% of tuition expenses for up to one year for students who are close to completing a degree but have stopped attending school.

In my view, this is good economic policy. A number of economists throughout the state agree, arguing in an open letter to lawmakers (which you can read at bit.ly/openletterUMS) that a partial tuition waiver at Maine’s public universities would be economically beneficial for the state. Research on similar programs in other states supports this conclusion, indicating that the benefits of such programs exceed the costs, likely yielding a positive return on investment for taxpayers.

This type of investment in higher education would not just improve the standards of living for students who wouldn’t otherwise be able to attend college, it would improve the living standard for the state as a whole. We need the state to make this investment because students increasingly can’t afford to invest in higher education themselves, even though it’s essential for economic success — both theirs and ours.

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