My take on the Obama education plan

Obama Takes on the College Cartel

Congratulations on the catchy headline!  Someday, I'll learn how to write eye-catching headlines like that.  But I digress.  I really want to talk about Obama's education plan.  Everywhere I look, I see the claim that the president has a plan to "make college more affordable."  This sounds an awful lot like Obamacare, which I've already argued will do no such thing.  I think the administration needs to redefine "affordable."  So, here's my response to the plan as outlined in the above-linked article.

“College has never been more expensive,” Obama declared during today's campaign-style speech in Buffalo. “Higher education cannot be a luxury. It’s an economic imperative.”

Okay, so I'm stumped already.  What makes higher education "an economic imperative?"  I guess you can look at historical data and statistics and see that in the past, college grads were less likely to be unemployed and over the course of their working life would make somewhere around a million dollars more.  Sounds good, but in the past, everyone wasn't a college grad.  College grads made more money, and were unemployed less because they have been in short supply.  Making everyone a college graduate removes the shortage and makes having a degree a non-advantage.

Enough about that.  I wanted to talk about the specifics listed in the article, which are:

• Rank colleges based on performance.
• Link government-backed financial aid to college performance.
• Ease the burden on borrowers.

Gee, that all sounds good, doesn't it?  Let's have a look at each of these one at a time.

Rank colleges based on performance. Unlike the “best colleges” rankings published by a number of private organizations, the government’s scorecard would measure things such as affordability, a school’s outreach to disadvantaged students, graduation rates and the real-world earnings of graduates once they enter the job market. Obama wants these rankings to be in place by the time the 2015 school year begins. The Dept. of Education already provides some affordability data on colleges; under the rating system, there would be even more info and it would be easier to compare colleges.

So, the first part of the "solution" is to devise a new ranking system.  Of course, we have to do that so that our rankings will show that we have actually made an improvement on the education system.  But what will we rank schools on?

1. Affordability.  Seems reasonable, except it doesn't tell us to whom it is affordable.  We can only guess that it means affordable to the students.  Unfortunately, that translates into something that may mean unaffordable to taxpayers, since the money has to come from somewhere, and whatever costs are not paid directly by the students are already subsidized.  How can a school make high marks in the affordability category?  By cutting costs.  Either make classes bigger or pay teachers less.  Neither of these is a great option.  Students can benefit from smaller classes, and I'm willing to bet that cutting teacher salaries won't do a lot to attract high-grade talent.
2. The school's outreach to disadvantaged students.  By "disadvantaged students" I'm going to assume the meaning is students from poorer backgrounds.  The article doesn't say how we're going to measure the school's outreach efforts.  I have read articles (apologies for not remembering where) that claimed that some disadvantaged students don't go to "better" schools even if offered a scholarship because they don't believe they can really go to an Ivy League college.  I'm not sure that the schools should be held accountable for that.  Otherwise, I don't really have much of a problem with this one.
3. Graduation rates.  Here's where I really start to have a problem with this whole thing.  How does anyone suppose that schools can increase their graduation rate?  Especially given that the government is going to be funneling less and less academically inclined students to their classrooms.  It's easy, really.  Make the curriculum easier.  Everyone gets a passing grade as long as they show up and hand in the work.  Never mind how good the work is.  If you hand it in, you get at least a "C," end of story.
4. Real-world earnings of graduates once they enter the job market.  Okay, except that the real-world earnings of graduates are going to be generally higher for students who attend those Ivy League colleges, because through attending that Ivy League college they've gained the connections that will give them an advantage after school.  At least, that's part of it.  Some colleges are located in lower paying areas, so it would seem natural for most graduates from those colleges to go to work at lower pay.  Some majors pay less.  And the amount of pay isn't necessarily the first consideration in accepting a job.  The point is, this is, in my opinion, a pointless rating.

Moving on to the next part of the "plan":

Link government-backed financial aid to college performance. Once the ratings have been established for a few years, Obama wants Pell grants and other types of federal aid to be targeted more toward schools that have a proven record of graduating a high proportion of students who get good jobs.

 This is a terrible idea.  Put together with the first part of the plan, this amounts to the government being able to pick and choose who gets more money.  They rate the colleges according to their own, self-designed rating system, and then dole out the cash according to who rates the highest.  If I were doing the rating, and I were doling out my own cash, that would be fine.  But I'm doing neither.  Instead, the government is doing the rating, which I may or may not agree with, and then doling out my (as well as other taxpayers') money.  In the end, the result is more likely to be that Pell grants will go to those institutions that are in the most expensive areas, and that graduate students with degrees that are more highly paid.  In other words, it will just create a new (or worse, it will just strengthen the existing) "education cartel."

Encourage states to fund public universities and community colleges based on similar performance measures. Some states, such as Tennessee, Indiana and Ohio, are already doing this. A push from Washington could encourage more to do so.

This just makes the previous terrible idea even more terrible.

Create new incentives for “innovative” types of education. Universities that offer accelerated three-year degrees, new types of online learning or other programs that help cut costs and boost return for students will be rewarded with higher ratings, “regulatory flexibility” or perhaps a public shout-out from the president.

I think this comes from the old adage that goes something like this: "Just because that's the way we've always done it is not a reason to keep doing it that way."  The problem is, sometimes the way we've always done it is actually the best way to do it.  The U.S. used to have a good education system.  Then, someone decided it needed to be "innovated."  Now, it's such a mess, it's a wonder anyone can think at all (or perhaps a better phrasing would be it's a wonder if anyone can think at all).  Whatever happened to "If it ain't broke, don't fix it?"  We have "fixed" and "innovated" our way into a rapidly declining education system that just gets more expensive.  We can't afford it.

Ease the burden on borrowers. Obama’s plan would cap payments on student debt at 10% of a worker’s monthly income. Some students who recently took out loans are eligible for this “pay as you earn” program, which Obama wants to extend to everybody carrying student debt.

This may be the only part of the "plan" that I agree with.  Borrowing money for any reason poses a lot of risks, even when the borrower uses those funds for the "right" reasons.  Getting a college education should be a right reason to borrow money.  But the future is always uncertain, which is where the risk comes from.  Making the repayment dependent on future earnings will help alleviate that risk.  But in actuality, I don't really think that students in higher education should be shouldered with massive debt at all.  I think the debt problem is really the result of all the other things that have gone toward increasing the cost of higher education.  We need to realize that not everyone belongs in college, and when we realize that, the cost will begin to decrease.  And that will lead, eventually, to less student debt and better outcomes for graduates.