Daniel DiSalvo and Jeffrey Kucik:

To pay for rising pension costs and obligations in other areas, states deem higher education to be expendable. How did we get to this point? Because it is easier – and more politically expedient – to cut higher education than it is to cut other areas.

First, states have strong incentives to increase expenditures on certain programs. Take Medicaid, which consumes one of the largest slices of states budgets. Medicaid operates on a federal-state matching formula, which means that any state funding cuts result in less federal money.

The same can’t be said of higher education. Unlike Medicaid, states do not incur a direct cost when cutting higher education funding. Instead, they can shift costs to the federal government, incentivizing states to reduce higher education spending. Since the 1990s, federal aid per student has risen from roughly $2,000 to $6,000 in loans; $1,000 to $3,000 in grants; and $0 to $1,000 in tax credits. Rather than bearing the financial burden, state governments transfer the costs to the federal government and to students and their families.

Second, several areas of states spending – notably public pensions – enjoy strong legal protections. Public sector unions, which have a vested interest in expanded benefits, can fight pension plan retrenchment as a violation of personal property rights codified in the 5th and 14th Amendments. This deters state governments from targeting areas of the budget insulated by legal barriers.