THERE'S EXCESS DEMAND FOR PRESTIGE DEGREES? One of the Chicago Sun-Times's sources on the University of Illinois brain drain reacts to my post. It transpires that he has his own web journal and a few "I wish I had said" comments on the Sun-Times interview.

I kicked myself about ten minutes after talking with the reporter for not saying, if you can't beat 'em join 'em. Meaning maybe if private universities pay better and deliver a better product, we should be re-thinking this government college thing. But I didn't think of that aspect while opposing the trustees' call for more salary money. How is it private universities can afford higher salaries when they don't have access to everyone's pockets like government colleges do?

The (most famous) private universities tend to pay better (and their best people work their tails off) and they're perceived to offer a better product, so much so that they game the U.S. News ranking system by keeping tuitions lower than market-clearing so as to appear more selective. (Those tuitions can still be inflated via the third-party route: to get government research grants the universities have to comply with all affirmative action laws and participate in the federal financial aid system.)

In some states, the state university systems have more aggressively competed with the most famous private universities so as to raise revenues and replace the state subsidy money that has not been forthcoming. Is that reason to rethink the state university program? Possibly. One line of research suggests that state subsidies are a subsidy to current and future members of the upper middle class. Another line of research suggests that on net the transfers are neutral to redistributive. There is probably room for additional research on the effect of institutional quality: how much of the state higher education system is engaged in cooling out marks with McDegrees? I repeat last night's claim.

The onus on policy makers within the university, as well as within state government, to design the state university system as if their most influential constituents were going to use it.