Helping college students actually prosper
America’s rise as a world power occurred after World War II for several reasons: a strong military, a booming economy and a country that thrived on innovation and cutting-edge technology. Much of that came from a smart plan to combine all three, a GI-bill that would enable soldiers to go to college after World War II.
Recognizing that an expansion of universities enabled the USA to have a strong security presence and an economy that was the envy of the world, a law passed in the 1960s that opened that same education chances for all Americans. It was also equality of opportunity for many.
This year, the Higher Education Act is undergoing one of its period reauthorizations. Many ideas kicked around are good, but there are a few proposed changes that need to be dropped.
As reported by Georgia Rep. Drew Ferguson from the Education and Workforce Committee, the PROSPER Act will “double the allocation for work study programs and continue year-round Pell Grants with a new offer of a Pell bonus for students who enroll in more courses to complete faster.” A lot of our students are Pell-eligible, and would greatly benefit from this reform. This is exactly what we need, and politicians like Rep. Ferguson should be commended for this.
The PROSPER Act also improves financial aid counseling and provides more efforts to make students and parents learn earlier about the federal financing options.
It’s another good idea. Reducing some federal regulations and making the accreditation process tougher, while allowing greater transparency are also good ideas.
For example, greater transparency would reveal that more than half of all borrowers attending a for-profit college in 2003 defaulted on their student loans after 12 years, double the rate of defaults for those at two-year community colleges according to a Brookings Institution Report. That study shows the number could expand to 70 percent for for-profit colleges in the coming years.
By contrast, the Chicago Tribune found the default rate at public colleges is 11.3 percent, and only 7.4 percent at private non-profit colleges. Yet Education Secretary Betsy DeVos decided to loosen regulations on the for-profit colleges. PROSPER could solidify those looser regulations on for-profit colleges, so they don’t have to demonstrate their students are “gainfully employed.”
Plans to charge different loan rates to different majors, and with frequent necessary updates would be as unwieldy as an old Soviet price system. Let the market continue to decide on loan rates via an institutional cohort default rate.
Another problematic idea involves changing the clock on student loans. Interest would be charged the moment the loan was taken, and not upon graduation, the way it currently exists. While I understand the people who say it should be just like a home loan or a car loan, there’s a different rationale for the student loan, and it involves our national competitiveness and having an educated workforce to compete for today’s and tomorrow’s business investment.
America is falling behind the rest of the world in college grads. Among the Organization for Economic Cooperation and Development (OECD) countries, the United States used to be first in the world back in 1995 in graduation rates, with 33 percent. Now we’re 19th in the world in college graduate percentage (39 percent) out of 28 OECD countries. That’s because the report showed we slashed spending on colleges in 2008 and 2011, while other countries boosted their investment in education. We’re even behind places like Iceland, Poland and Finland.
When the future investors seek out the education workforce to meet those challenges, they’ll likely pass us by, because reducing the opportunity of Americans to get a student loan will put college even further out of reach. It’s hardly a way to make America “great again.”
So contact your member of Congress, and let them know the best way to help America really PROSPER.