The American Academy of Arts and Sciences recent report Public Research Universities: Changes in State Funding explains state legislatures’ reasoning for shuttling funds for higher education to other priorities, such as: K-12, Medicare, and prisons.
The authors of the report note that higher ed. “is perceived as a relatively flexible budget item,” while the others are perceived as less so. Consequently, the amounts states disburse to colleges and universities can end up lower when Medicare or prisons, for instance, require greater resources.
When state allocations are cut, colleges and universities resort to other sources of revenue to balance budgets, most commonly raising tuition. That can set off a series of actions, including greater debt and students deciding not to attend college. Since earning a degree offers one means for students in the lower income earning groups to move out of poverty and to achieve class mobility, cuts to higher ed. can result in further entrenching economic inequality.