Making higher education truly debt-free

The cost of higher education keeps getting higher, and policymakers haven’t been helping. Hillary ClintonHillary Rodham ClintonLabor chief: Clinton-Lynch meet not ‘planned in advance’ Clinton scheduled to interview with FBI: reports Dem platform draft adopts Sanders proposal on taxing foreign earnings MORE’s recently announced “New College Compact” is the latest example. The central idea of Clinton’s plan is that by spending more tax dollars we can make college debt-free. Specifically, she’s proposing to spend at least $350 billion over the next 10 years to subsidize college tuition and modify student loan payments. 

Yet this solution is no solution at all. It would merely prop up a broken system without addressing the drivers of soaring tuition costs: the flow of federal funds into higher education, and the lack of any meaningful alternative to traditional four-year degrees. Instead, it’s time to broaden the higher-education space and make room for innovation.   

ADVERTISEMENT
The Higher Education Reform and Opportunity Act (HERO) (S.649) would do that. Introduced by Sen. Mike LeeMike LeeThe Trail 2016: Meet and greet and grief Trump to meet with Senate GOP next week First trans Senate candidate: My gender won’t be an issue MORE (R-Utah), the HERO Act lets states define their own accreditation standards to include alternatives to traditional four-year degree programs. Access to these options through accreditation reform will help lessen the burden of rising tuition and student loan debt. 

This burden has grown alongside government spending on education. Since 1980, federal Pell Grants increased from $2.5 billion to over $30 billion in 2015. Meanwhile, the cost of college also jumped—by over 500 percent since 1985. That’s compared to inflation of 121 percent and medical cost increases of 286 percent over the same period.

A new study by the Federal Reserve Bank of New York found this was no coincidence. Researchers discovered that every new dollar in federal Pell Grants causes tuition to jump by 55 cents, while every dollar in subsidized loans pushes those prices up by 65 cents. 

In other words, the more the federal government subsidizes higher education, the more expensive higher education becomes. 

The direct connection between government financing and tuition costs is at the heart of the college affordability crisis. The promise of never-ending taxpayer funding gives schools the incentive to raise prices, knowing there will always be someone to pay the bill—the taxpayer.

Clinton’s proposal would exacerbate this crisis. The average student loan borrower for the class of 2015 will have to pay over $35,000 in student loan debt. Young Americans can’t afford policies that spur additional tuition increases, and thus more debt. Rather than sticking with the stale ideas of the past, serious reformers should work towards a complete overhaul of America’s higher education system. That means providing more choice and meaningful alternatives to traditional four-year degrees. 

That’s where the HERO Act comes in. It reforms the federal accreditation standards used to classify which institutions are considered legitimate. This process is crucially important, determining whether credits are transferable from the school in question.  Unfortunately, this process does more to protect established universities from competition than to promote high-quality, cost-effective education. 

Educators shouldn’t need a federal government stamp of approval to compete with the status quo. Decentralizing accreditation and broadening the market for education would force prices down and create career-focused alternatives to rigid four-year degrees. This change is critically needed: Four-fifths of the Class of 2014 had no job lined up a month before graduation. 

One such alternative is massive open online courses (MOOCs). These courses allow students to take classes online at inexpensive prices. There are a growing number of online programs tied directly to employability, such as computer engineering courses aimed at students with no background in programming. Some MOOCs cost as little as $200 a month.  

There is agreement that we need more degrees in science, technology, engineering, and math (STEM). MOOCs are one way to get there. Accreditors have been slow to embrace MOOCs, but even White House science and technology experts have urged those accreditors to make way for change. The HERO Act would also make room for more two-year advanced training and apprentice programs. These provide alternative methods of certification and connect students to high-paying tech, medical, and manufacturing jobs.

It even permits the accrediting of individual courses, letting students personalize their education down to the specific course. In short, this would focus accreditation on what’s best for individual students, rather what’s best for educational institutions. 

This bill is a step in the right direction. Making more options available is a better way to reach higher quality, more affordable education system than onerous regulation and costly spending. It currently sits with the Committee on Health, Education, Labor, and Pensions, and deserves a vote on the Senate floor. 

Hillary Clinton and other policymakers should embrace the 21st century, not keep higher education mired in the 20th.  The HERO Act recognizes that more choice and more innovation are far more helpful than more federal dollars.

Coopersmith is a policy and legislative analyst  at Generation Opportunity, a youth advocacy organization.

More in Energy & Environment

Who – truly – could be against saving Americans $60 billion?

Read more »