President Obama pushed for more spending on colleges and enhanced student loans in his State of the Union address.

Via Instapundit, Michigan Capital Confidential contributor Jarrett Skorup uses his state’s higher education spending experiences to argue that that is not the best approach to help Young Americans.

Requests for more higher education funding is reported willingly in the media: It’s the “most important investment” people can make. It “returns $17 in economic benefits” per dollar spent. It results in “lifetime earning power.”

But the central arguments are dubious for five main reasons:

1.     There is no link between higher education subsidies and economic growth, and none between college degrees and job creation.

Since 1980, Michigan has spent a much higher proportion of personal income on state government support for higher education than nearby states like Illinois and Ohio. … This did not lead to higher growth as Michigan’s economy performed among the worst in the country during that time period.

2.     More subsidies equals more waste.The number of administrators and service staff at Michigan’s 15 public universities increased at a faster rate than full-time equivalent students. Administrators and service staff numbers went from 19,576 in 2005 to 22,472 in 2009, while full-time equivalent students increased from 250,030 to 257,230 over the same time period. At the same time, the compensation for the average employee increased 13 percent….

3.     When comparing earning power between college graduates and non-graduates, correlation is not causation, and the actual cost of college matters. Proponents of more funding for higher education almost always cite the same statistic as their main point: Overall, college graduates tend to make more money in their lifetime than those without a degree.

But this assumes that the degree caused the higher earnings, rather than the fact that those who complete college are already more likely to be financially successful whether they attend university or not.

4.     Ensuring that everyone has college schooling would not enhance the labor market — it would dilute a university degree.The assumption among many is that every career should require a college education. This belief leads to subsidies for subjects with little practicality in the workforce and areas where a student may be better off doing an apprenticeship or working for four years than attending more school….

5.     Higher education may be the next bubble to burst.

Much like the housing bubble, higher education is fueled by government subsidies, publicly-backed loans and incentives that say everyone should be doing something. As noted and expanded on by law professor Glenn Reynolds, economist Richard Vedder and writer Nathan Harden, tuition costs have skyrocketed well above inflation while colleges compete to expand into areas outside of their main purpose and taking on more debt to do so. At the same time, competition from other sectors, like online education, offer cheaper alternatives to the bread-and-butter of university academia.