By Colin McAuliffe (@ColinJMcAuliffe)

Terry McAuliffe, the former Democratic Governor of Virginia, recently penned an op ed where he called for “realistic” solutions to the country’s problems while leaving open the possibility of a presidential run. McAuliffe argued against tuition free college, saying that it would be inappropriate to use taxpayer money for tuition for children of well to do families. For what it’s worth, the public doesn’t seem to buy into this argument. Civis Analytics polled tuition free college for Data for Progress, and included an explicit tax increase as well as McAuliffe’s argument that the program would benefit wealthy families (as a counterargument from a Republican), but the policy had net support anyway.

What’s troubling about this argument is that it can be used against any universal program such as K-12 education, Social Security, or Medicare. There are important debates to be had about education policy, especially on how to create pathways to the middle class that do not require college at all. However, simply noting that the wealthy would benefit is not a compelling reason for why means testing might be appropriate for a particular program, and potentially undermines political support for benefits that many rely upon.

Appealing to the notion of the rich getting a free ride from tuition free college is particularly cynical, since McAuliffe and other centrist Democrats rarely (if ever) acknowledge that the economic system is itself a free ride to the wealthy. For decades, the wealthy in the US have enjoyed enormous gains in income and wealth simply by the virtue of the fact that they were wealthy in the first place.

Economists have noted that the labor share of national income, or the portion of the gross domestic product that is paid as compensation to workers, has been in decline. The remaining portion goes to several other places, including a significant part to the capital share, or the share of national income that is paid to owners of capital.

Declining labor share combined with declining effective corporate tax rates has lead to huge increases in after tax corporate profits. Unit profits are after tax corporate profits as a fraction of the national gross value added, which is the value of all goods and services produced in the country. From the 50’s through the mid 70’s, about 2 cents of after tax profits were generated from one dollar of goods and services produced. By 2017, this figure exploded to 10 cents on the dollar.