A few additional thoughts on that subject:

http://www.rockinst.org/pdf/education/2010-03-18-A_New_Paradigm.pdf

http://www.ncsl.org/research/education/the-link-between-higher-education-and-economic-dev.aspx

http://eric.ed.gov/?id=EJ956731


That last one looks quite interesting, as it compares various strategies. Note that I've deliberately avoided those sources which might be best termed "suspect by virtue of conflict of interest-- that is, educational institutions themselves... though this of necessity eliminates much of the more rigorous scholarly work on the subject.

This, I think, probably summarizes my own feelings on this subject quite nicely. It's not entirely liberal/humanist philosophy that drives a desire to fully subsidize higher education.

http://www.nas.org/articles/Higher_Education_and_Economic_Growth

It's also not incompatible with my innate frustration at the ever-lower expectations and quality in primary and secondary education which we HAVE fully subsidized, on the other hand. tired

Schrödinger's cat walks into a bar. And doesn't.