Michael Horn testifies before the House Higher Education and Workforce Investment Subcommittee … [+]
Yes, Congress remains dysfunctional. But when it comes to higher education, at least some good ideas are making their way through the House.
House Republicans recently announced the College Cost Reduction Act. It would increase transparency in college costs, phase out Graduate PLUS and Parent PLUS loans, expand Pell Grants for students who are more likely to graduate on time, and increase the amount graduates pay back to the federal government. All universities will be able to participate even if they do not have sufficient income to participate. student loan.
This bill reflects some of the important recommendations I made to the House Subcommittee on Higher Education and Workforce Investment. I called for transparency in upfront pricing and for universities to share the risk with taxpayers if students don't repay their loans.
I also encouraged the federal government to stop thinking of existing accreditation agencies as the answer to quality assurance. And he says universities should stop regulating input into how they do their jobs. Instead, we should free up our schools and reward them for providing value to students and taxpayers.
Towards this end, the law proposes accreditation reforms that would allow for new “quality assurance bodies.” These bodies will facilitate the creation of new universities that can bring innovation and lower the price of higher education. Because the bill focuses on student outcomes, it also limits the Department of Education's ability to micromanage the contracts universities enter into and how they do their work, limiting much-needed innovation. It is regulated.
Bipartisan agreement on these principles should be possible. Democrats have accused some institutions of raising fees with little benefit to students. Spreading risk will encourage universities to focus on outcomes and value for students and to more carefully consider the contracts they enter into.
For those who believe that higher education is about more than economic benefits (count me on that list), this law is a sign that higher education is simply about providing students with jobs and investment returns. I'm not saying that.
Instead, it effectively sets a minimum return for these products. Universities should take some responsibility if students are unable to repay their loans. If that means that current programs focused on training teachers and social workers, for example, are too expensive, the answer is to find ways to deliver them at lower cost. Don't subsidize things you can't afford.
The strategy of micromanaging inputs and providing subsidies without skinning universities is the strategy we have largely followed over the past several decades. It didn't work.
Since 1970, public university spending has grown from about $104 billion in today's dollars to $420 billion by 2020. In total, higher education institutions currently spend more than $670 billion annually.
And for what? Completion rates remain stagnant, with approximately 40% of students not graduating from a four-year college within six years. Significant outcome gaps still exist. And, according to the Commission on Postsecondary Education Value, nearly one-third of all institutions provide zero economic benefit to students after accounting for the cost of attendance.
The proposed bill is a step in the right direction to rectify that. For educational institutions that promise benefits beyond the workplace (and many do, and should), they should not force students and taxpayers into debt they cannot repay.
In a sign of normalcy, Democrats responded with a bill of their own. That's good. As I've written before, the Department of Education's recent instinct is to reform higher education through regulation, but what we need is action from Congress.
More Democratic imagination could still help. For example, this bill doubles down on making community college free, which only crowds out more affordable options. Supporting substandard systems that cannot be expanded through grants. And help those who need it least.
But Democrats have shown there is room for compromise, with measures such as price transparency, a Pell boost, and a focus on outcomes, even if limited to the for-profit and career college sectors.
This is a start worth negotiating, even if given the immigration shenanigans, the earliest a bill could be passed would be after the presidential election. At least we are starting to have a framework that focuses on student outcomes rather than failed grants that hurt everyone outside of the university.
