Wait, careful with the strawman there. Yes, USP is funded by taxpayers but the students themselves don't have to pay anything. The reasoning behind this choice is that the cost of a student in that University can be shared by everyone because the value of the knowledge produced there is also shared by everyone. People who otherwise wouldn't be able to afford college-level education are given the chance to study.

It's a decision that is aligned to the principles of social democracy. You could argue against it, take a more neoliberal stance, but that's not the point. My point is that USP is trying to do something different.

I wish I knew more about how private universities in US are funded. I have a feeling that aside from the tuition students pay they still receive some sort of aid from the government.

True, everything has it price. But it's also true that free market is not really free.