The higher-education system in Finland is supposedly every American progressive’s dream. The Finnish government pays 96 percent of the total cost of providing young Finns with a college education; almost all domestic students at Finnish universities pay nothing in tuition. Indeed, Finland subsidizes its universities more than any other country in the developed world. American advocates of free college say that if Finland can do it, so can we. But there’s a catch to the Finnish model, and it’s not just higher taxes.
Finland offers a nice deal for students only if they are lucky and talented enough to get in. In 2016, Finnish institutions of higher education accepted just 33 percent of applicants. That’s the degree of selectivity we’d expect from an elite college in America, yet that is the admissions rate for Finland’s entire university system. There is a price to pay for that kind of selectivity: Finland ranks in the bottom third of developed countries for college-degree attainment. Meanwhile, the tuition-charging United States ranks in the top third, thanks to open-enrollment policies at many of our colleges and universities, along with private financing and plenty of spots offered through a diverse range of institutions.
The Finnish example reveals a reality often glossed over by politicians and activists who advocate mimicking European-style free-college regimes in the United States: government budgets are finite, even when taxes are high. If a government elects to pay for a greater share of each student’s college education, something else has to give. Perhaps the university system will accept fewer applicants and produce fewer graduates, as is the case in Finland. Or maybe it will spend fewer resources per student, potentially lowering the quality of education. Finland is evidence that such tradeoffs are not mere theory or a false choice manufactured by miserly conservatives. Nor is Finland the only country where such stark tradeoffs are on display.