VSU Is Not About Free Market Choice

This generated a fairly fiery discussion when I posted it on my blog. Some didn't follow the technicalities of what I said, and I'll admit that it's rather long, so if you want to know my conclusion it is, in a nutshell, In the absence of governmnent interference in the university sector universities would provide services currently funded by student union funds by charging students for them. They would just take this money out of general revenue (ie course fees) but due to current price caps they have to charge a special levy. VSU thus makes the university sector less like the free market than it already is because it stops universities doing something they would do without government rules.

I had an epiphany the other day* and I realised that the debate about VSU has been tainted by an ingeniously deceptive conservative framing which happens to be completely bogus. I've decided that VSU has absolutely nothing to do with the free market or economic choice. In fact it has nothing to do with economic conservatism at all and the whole thing looks more like pseudo-welfare for the upper-middle class.

Choice in the free market is not about being able to get what you want, it's about accepting or declining what is offered to you. Thus, while I want to be able to buy a car which perfectly matches my requirements and tastes, I have to accept what car companies decide to offer me (based on their market research etc). There is no guarantees in the market that you will be able to buy what you want to buy, your choice is whether or not you still make the purchase even if it isn't exactly what you want.

The principle is superficially different with VSU. When you want to go to university and 'purchase' a tertiary education you are currently being 'forced' to pay for things like sporting clubs and BBQs which you might have no interest in paying for. But this sort of thing happens in the wider marketplace all the time. When you go to a private school you might be forced to pay a couple of thousand dollar surcharge for a sporting facility you have no interest in using or a laptop you don't really want, when you buy a Nike shoe a very large percentage of the price is a hidden surcharge to cover their advertising and sponsorship costs even if you despise advertising, when you buy a product from a large multi-bodied corporation you might be paying to subsidise an unprofitable and unrelated business arm... none of which you have any 'choice' over. Your choice with universities at the moment is exactly the same as in the general market – take it or leave it.

When you buy a product you are giving your money to the seller to do whatever they like with it. There is no free market principle whatsoever which says the money you pay for a service must be spent on that particular service and that particular service only. If the extras you are paying for, but not using, make the product too expensive in your eyes then you don't buy it. You don't go running to the government asking them to force the seller to split up their product offering. But that's exactly what the conservatives are doing.

Once again, there is another superficial point of differentiation when we're talking about universities in that it's not an entirely free-market sector. But, again, this is a superficial difference because VSU only serves to make the sector even less like the free market. Already universities have restrictive price caps on what they can charge for an education, so they are unable, in the absence of a compulsory services fee, to make the business decision that wider student services are worth providing. The vice-chancellors are opposed to VSU for a reason – being able to charge the fees enhances the 'product' the university can offer which attracts students, particularly of the lucrative full-fee paying international variety. VSU simply makes the sector even more closely regulated by government.

The ingenious framing I referred to earlier is to frame the union fee as a tax. That way defenders of union fees have had to try and justify them by pointing to either equity advantages of student services (such as free campus medical and counseling services which some might otherwise be unable to afford) or by playing up the public good aspects of some union services (it's really difficult to exclude people from watching the lunchtime band). But this is bizarre and irrelevant. Universities aren't governments. Peopole have a choice as to whether or not to go to them and none of the anti-taxation/government arguments legitimately apply. There is no market-based reason why universities should not be free to charge a services fee, especially as there is an on campus democratic system for students to utilise if they believe there is widespread corruption and waste in the student union.

Students are overwhelmingly from high income families or they will themselves become high income earners. Listening to their demands for the government to make a service they choose to utilise a few hundred dollars cheaper per year is nothing short of middle class welfare. I realise that at heart VSU is an ideological crusade unfinished after from the campus political wars of the 60s and 70s, but it's being sold under an entirely different 'free market' idology and I think the illegitimacy of that framing needs to be recognised.

*I had this epiphany while listening to the new Sigur Ros song which is awesome epiphany music.