Obamacare has been such a popular success so far, what could possibly go wrong?

Examiner Editorial: Obama puts higher ed at the mercy of big government

President Obama outlined a new plan Aug. 22 designed to make higher education more affordable, the key provision being a new government-run rating system to compare colleges and universities according to a complicated range of factors like tuition, enrollment of low-income students, graduation rates and how well graduates do in the job market. Students enrolled at highly rated institutions would get more aid and lower interest rates.

Given such rating factors, Ivy League and other elite schools are already well-situated to benefit in a system in which federal bureaucrats control the scoring of insitutions and decide which campuses can offer the most favorable terms. In other words, bureaucrats acting at the behest of politicians like Obama will be in the driver’s seat in higher education, as they already are in secondary education.

If this sounds somehow reminiscent of Obamacare — and in fact most every program Obama proposes — it should because it takes the same approach. Politicians and bureaucrats decide the priorities for allocating resources, what are acceptable outcomes and the standards underlying the services offered.

Politicizing markets protects incumbent providers and delivery systems, and prevents the innovation and competition required to keep costs down while improving consumer choice. This is true in Obamacare, which favors large corporate insurers and hospitals, just as it is in education where his approach is tilted heavily toward elite private schools and against public state schools.

Obamacare envisions paying providers by health care results instead of by procedures, although the exact formulas for how the federal government will implement this new “pay-for-performance” scheme remain a mystery. Obama hoped that insurance companies and providers would compete in Obamacare’s state marketplaces, creating new innovations and cutting costs. But that isn’t happening. Hospitals and insurers are consolidating. Obamacare ultimately will transform each state’s largest insurer into a semi-public utility that is heavily regulated by the federal government.

Obama’s higher education solution takes the same approach.