School choice is usually the only aspect of education reform that gets much attention, though in recent years the prospect of the student-loan bubble bursting has brought higher education into focus. An NPR story from last night shows why higher education reform is moving up on the agenda of various politicians.
Its headline really says it all, but the story is worth reading as well. It’s titled “Going To College May Cost You, But So Will Skipping It.” That’s a good demonstration of why both the “for” and the “against” arguments in terms of getting a four-year degree seem to be one and the same. College has become absurdly expensive, but so has forgoing college. That’s the problem in a nutshell, isn’t it?
Part of what makes this so frustrating to the public and to some policymakers is that there are very obvious reasons for this. The federal government’s role in the student-loan business artificially inflates tuition rates, and its position as the sole accrediting institution does the same by protecting entrenched schools and barring entry to the marketplace for others, thus further driving up the cost of college. Access to federal loans is also tied to accreditation. That’s why in recent days both Marco Rubio and Mike Lee have floated ways to change that:
At issue are federal student loans, which can only be used to pay for education at federally accredited institutions. Lee argued that this policy makes the federal government a gatekeeper to higher education — and rather than keeping out bad actors, he said, it just protects institutions from competition. And as the government has closed and then subsidized this market, its product (the ubiquitous Bachelor’s degree) has become more expensive and less valuable.
So Lee’s proposed fix would let states set up their own accreditation regimes that would run parallel to the federal government’s.
“College presidents can rest assured that if they like their regional accreditor, they can keep their regional accreditor,” he said. “And I mean it, I’m absolutely sincere.”
Lee said the legislation could let states open accreditation for apprenticeships, professional certifications, and competency tests, among other alternative higher-ed modes. Apple and Google, for instance, could work to make accredited computer courses.
In a speech Monday, Rubio appeared receptive to Lee’s proposal, and had a few of his own:
Rubio, a potential 2016 presidential candidate, also pushed for the passage of the “Know Before You Go Act,” which would provide students with data about potential earning by different fields. But such a proposal would require reversing the ban on a national student unit record system.
“It’s important for students and families to have access to the information they need to make a smart choice,” says Ethan Senack, a higher education associate at the U.S. Public Interest Research Group. “Sens. Rubio and [Ron] Wyden undertook an important effort … trying to balance the need for transparency and information with institutional burden and privacy concerns. I think it’s certainly an important step in the discussion, but there’s a lot more that needs to be done.”
One of two suggestions Rubio made to tackle the growing mountain of student loan debt is to make income-based repayment the default option for all borrowers. Recent data from the Consumer Financial Protection Bureau shows just slightly more than 10 percent of federal loan borrowers are enrolled in some type of income-driven repayment plan.
Income-based repayment plans have their drawbacks, such as the fact that they force the federal government to bear more of the risk and don’t necessarily control costs–a recipe for trouble. But these are essential conversations to be having for the simple reason that, as the NPR story makes clear, you can’t really opt-out of this expensive system. (There are exceptions, such as trades that don’t require a four-year liberal arts degree.)
“The result is a growing opportunity gap between the haves and the have-nots, those who have advanced education and those who do not,” Rubio said in his Monday speech. Rubio’s language here is correct if he means that those who have an advanced education have achieved their degree. As Andrew Kelly pointed out this afternoon, there is a vast difference between going to college and completing college, and the gap in earning potential between those with who started college but didn’t finish school and those who skipped it entirely has narrowed.
Both NPR and Kelly were discussing a new Pew report on the issue. For its story, NPR did a round of interviews and one student credited past data on income disparity with his decision to go to college, though his first instinct was not to: “In this generation you have to go to college. Like, it isn’t even optional.” That’s becoming more and more the case, and it’s a problem. And it makes the government’s gatekeeper role in higher education all the more troubling just as it makes reformers’ attempts to fix the system all the more important.