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Degree holders earn significantly more over their lifetimes
The funding must come from increased taxation; taxes have a negative effect on economic productivity.
As human knowledge grows, the amount of education and specialisation required in order to be a successful participant in democracy and an economic contributor also rises. A highly educated population is desirable for this reason, and the benefits vastly outweigh the tax burden.
As the number of unskilled jobs being filled by computers and robots goes up, the proportion of specialists and educated individuals must in turn also rise.
There is no evidence that this will increase economic growth for any industry sector other than higher education. And that growth will be false.
certain degrees need to hold precedence over others when it comes to financial support. E.g. history degrees tend to be less profitable than Computer Engineering degrees.
Behaviour tends to align with the source of funding; public funding means the interests of the government may be served over the interests of the students.
The tax burden falls mostly on corporations and rich people. They do not like taxes and try to leave your country when you raise taxes. This would hurt economic growth.