Washington: For College and Country

During the presidential campaign, Bill Clinton called for a National Service Trust Fund to "guarantee every American who wants a college education the means to obtain one." Under Clinton's plan, the federal government would increase loans to college students. But as part of Clinton's "New Covenant," in which people don't get government benefits for nothing, students would be required to repay the government through payroll deductions or to work for one or two years at a "public service" job. If they took the latter option, they would receive $10,000 in wages and $10,000 in loan forgiveness for every year they worked.

Clinton has had this idea for a while. In 1988, the Democratic Leadership Council proposed a plan for national service. In his foreword to that proposal, Sen. Sam Nunn (D–Ga.) lists Clinton, at the time a member of the DLC's governing board, as one of the proposal's developers. Will Marshall, the plan's author, now heads the Progressive Policy Institute, which The Wall Street Journal called "Clinton's campaign think tank."

So although Clinton was vague about the details during the campaign, we can reasonably assume that his national-service proposal will resemble the DLC's. And Clinton thought the idea important enough to mention it again in his November 12 news conference, his first after being elected.

Government service later in return for college aid now is not new. The U.S. military does it with its ROTC program, in which college students receive enough money to cover all college expenses, plus a small stipend. In return, students train during their summers and serve as military officers for a number of years after graduating.

Nevertheless, national service is a bad idea. It undercuts the concept of voluntarism; it would give taxpayers little in return for a lot of money; and, ominously, its strongest supporters have traditionally favored compulsory national service with prison sentences for those who refuse. Furthermore, there is a better way for students to get college aid that costs taxpayers nothing and would not even involve the government.

National-service advocates usually pitch their proposal by appealing to the strong tradition of service in America. They picture many "unmet needs" that national-service workers will supposedly meet. When he described his plan in his nomination-acceptance speech at the Democratic convention, Clinton envisioned "millions of energetic young men and women, serving their country by policing the streets, or teaching the children, or caring for the sick, or working with the elderly or people with disabilities, or helping young people to stay off drugs and out of gangs."

The Democratic Leadership Council claimed that its proposal built on the American tradition of voluntarism that Alexis de Toqueville so admired in the 1830s. National service, the DLC claimed, would encourage citizens "to rely less on the impersonal agency of government to solve their problems."

But national service actually violates the tradition of voluntarism—precisely by getting the government involved. And that involvement doesn't come cheap.

An October 23 Washington Post article pegged the cost of Clinton's program at $10 billion to $13 billion. An additional $10 billion in spending amounts to, on average, an additional $100 in taxes for each of the roughly 100 million taxpayers in the United States. Clinton thinks his program will cost about $8 billion, an estimate he defended during one of the debates with George Bush and Ross Perot.

Yet this figure appears very squishy. In an October interview, campaign spokeswoman Avis Lavelle told REASON reporter Grant Thompson that the estimate does not rely on any particular assumptions about what percentage of students would choose national service, as opposed to paying off the loans out of their incomes. But without this information, how can anyone predict the program's cost?

What would the taxpayers get in return for their money? Probably not much, if Clinton's bill resembles Sam Nunn's 1989 national-service bill. Nunn's bill forbade "displacing" someone currently employed. This means that national-service workers would not even be able to take the place of any of the millions of workers now being paid the minimum wage of $4.25 per hour. Their labor would then have to be used in tasks worth even less than $4.25 per hour. No wonder the needs are unmet: At current wages, they aren't worth filling.

Yet the $10,000 per year paid by the government to the national-service worker, plus the loan forgiveness of $10,000 per year of work, amounts to $10 per hour. So the government would pay $10 an hour for work that is probably worth less than $4.25.

To use the workers in more-valuable pursuits, Clinton would have to take on municipal employees, who have the strongest unions in America. During the campaign, he was unwilling to do this.

National service would put the federal government in the position of defining what is service and what is not. Its proponents take a very narrow view. Is a pre-med student serving when she works hard to become a doctor, not only to make money but also to help people? Not according to Bill Clinton.

What about the youth who wants to become a businessman so he can revolutionize the production of a good and sell it at a lower price? Is he serving? Apparently not.

As the proponents of national service see it, someone "serves" only when engaged in an activity that no one values enough to pay for. The national-service advocates take service to others and turn it into work. They would rewrite Milton's sonnet to read: "Only they serve who stand and wait."

To Clinton's credit, his national-service plan is voluntary for the participants (though not for the taxpayers). But many prominent supporters of national service would prefer compulsion. For example, Sen. Charles Robb (D–Va.), one of the sponsors of Nunn's 1989 bill, has stated his preference for universal military training. Nunn himself used to be a strong advocate of the draft.

And Sen. Harris Wofford (D–Pa.), in a 1979 book on national service, expressed his excitement about "the extraordinary mobilization of the talent of young people possible under authoritarian, post-revolutionary conditions" such as those in China. In that same book, Roger Landrum, a contributor to the DLC's proposal, favorably cited Chairman Mao's forced removal of millions of Chinese youth from cities to the countryside and Castro's similar coercion of Cuban youth as examples that "fire some American imaginations."

None of the supporters who reject compulsion do so on principle. In a 1989 Washington Post op-ed, for example, Landrum gave three reasons for rejecting compulsory universal service: 1) "the cost is out of sight," 2) "debates over compulsion are an endless distraction," and 3) "the administrative requirements are a nightmare." So Landrum's only objection to compulsion, aside from cost and administrative hassles, is that it has to be debated. And red tape, not prison sentences for 18-year-olds, is his idea of a nightmare.

It isn't hard to build a scenario in which national service leads to a draft. Here's one: National service attracts few kids from higher-income families. Its advocates then argue that the only way to get broad participation across all income classes is to make national service compulsory. With the voluntary-service network in place, and with an existing constituency of organizations that benefit from the artificially cheap labor, the next step is compulsory service.

Implausible? In 1989, Scott Celley, a spokesman for Sen. John McCain (R–Ariz.), told me that McCain supported national service to "start plugging people into positions and setting up networks with state and local officials." Then, after two years, McCain would have switched to a mandatory system of universal service, with "disincentives" for those who do not participate.

"Could one 'disincentive' be a prison sentence?" I asked. Answered Celley: "Under consideration would be a full range of possible penalties to ensure mandatory participation."

It's true that national service addresses a real problem—funding for college education. But there's a better solution for those whose parents can't afford tuition. They can borrow the money. True, the interest rates for borrowing are high, but they're high because the loans are risky. And the loans are risky for one main reason: The U.S. Supreme Court refuses to allow enforcement of contracts in which people exchange their future labor services for money. The Court calls that "involuntary servitude," but it's no more servitude than the requirement that I pay my mortgage.

The Court does allow such contracts to be enforced when the employer is the U.S. military. National-service advocates would have the government do it for civilian jobs. People should have the same freedom to contract with private lenders to do private-sector jobs. And that would take care of funding for any deserving student who could benefit significantly from college.

Contributing Editor David R. Henderson is an associate professor of economics at the Naval Postgraduate School in Monterey, California, and a senior research fellow at the Hoover Institution.