Reading through comments on various posts, it has occurred to me that part of the difficulty in discussing what ought to be the status of private universities is that we use the terms public and private in different ways.
A university may be public in one of two senses. That is, it may be run by the government. This is what we typically mean by “a public university.” But any institution may be public in another sense: the sense that it is open to the public (public in the way that “public houses” or “public schools” in the UK are public). Similarly, private might indicate run by non-governmental bodies (“a private health care clinic”); conversely or it might be private in the sense that it is not open to everyone (“a private club”).
Now this is where I get my geek on, so stop reading if fine distinctions make your head hurt.
With the above provisos, we can imagine at least four different theoretical kinds of universities:
A. PUBLIC/PUBLIC — run by the government and generally open to all.
B. PRIVATE/PRIVATE — run by some non-governmental foundation or corporation, and limited to only certain kinds of people
C. PUBLIC/PRIVATE — run by the government, but not open to all
D. PRIVATE / PUBLIC — not run by the government, but open to all
Which kinds of schools deserve government money?
Well, I think the idea that type A should be at least largely funded by the government is probably not too controversial. This is the case with most universities in Canada today.
Type B is approximately the situation at Trinity Western University and some others, and I have argued elsewhere that such universities should not receive public funds. That still seems right to me.
Type C is not common if it exists at all. One might argue that Universite St Anne, the French university in Nova Scotia, fits here, since it is limited to French speakers, but, as I understand it, it is not limited to French people. Anyone who is capable of working in French can go there, and that limitation (that you speak the language) is true of every university. First Nations University is closer, though from my reading of their web site, one does not have to be a Native Canadian to attend FNU. Is that a technicality? Is FNU meant to be limited to Native students the way TWU is limited to Christians? The way things are going there, it may not matter much longer. Generally, I would oppose government funding of C-type universities, which is to say I would generally oppose such universities in principle since you cannot be government-run without being government funded to some degree.
Type D is the most difficult. Quest University in BC is of this type, and they are common in the US. Such schools could not claim full government funding, since to do so, they would have to abide by the same government regulations around tuition that other universities do, and then they would effectively cease to be private. But I would not be opposed to indirect funding as, for example, when faculty members receive research grants, or when students receive subsidized student loans.
None of this is likely to convince anyone, of course, but it might help clarify the terms of the discussion.