House Republicans today advanced a proposal to end federal subsidies for student loans and let market rates dictate their costs. This is idiotic. America is competing in a global economy where success at the high end is largely dictated by the education of workers. Our rivals from Sweden to Singapore know this: that is why they pour money and resources into education. It is an investment that yields rich rewards, as evidenced by the relative success of the Massachusetts economy among many other examples. NYT:
At stake is a subsidized loan rate of 3.4 percent for more than 7.4 million students with Federal Direct Stafford Loans. That rate would jump to 6.8 percent if Congress fails to act; Democrats set the lower rate before Republicans swept to control of the House in 2011. Last June, Republicans buckled under political pressure and extended the subsidized rate for one year, just two days before its expiration.
This time, Republican leaders insist they will hold firm, but they face Senate Democrats who are dead set against their approach as well as a threatened White House veto.
“Who’s going to set interest rates, politicians here or the markets?” asked Representative John Kline, Republican of Minnesota, chairman of the House Committee on Education and the Workforce.
By the same argument, why not abolish public education and replace it with private schools for everyone — “who’s going to set education budgets, politicians here or charter schools funded by vouchers plus cash from parents?” That way lies a narrowing of educational opportunity, less effective use of our greatest resource, American minds, and increasingly direct competition with the world’s less educated workers. That is a fight we will lose: there are hundreds of millions of intelligent, disciplined people around the world willing to work for $5 a day. A primary factor of national differentiation for us is our superior and more widely distributed educational system.
I wonder what Gabriel Gomez thinks about this plan? Interestingly, he has no position on education issues, even though that sector is one of the largest employers in the state.
They are half right. The market should set the rate for private college tuition, and ending the student loan program would actually save the government enough money to fully fund and totally subsidize education at any public university in the country.
Unfortunately, what they are proposing is letting the banks dictate the rate at which government subsidizes private business. A true free market in education would totally eliminate the subsidized loans and let the individuals take out loans on their own. It would also blow up the higher education system as we know it.
Every major industrialized country has excellent and fully funded, if not, nearly fully funded universities. I don’t see why America deserves anything less. Our tax dollars shouldn’t be subsidizing Harvard, they should be reinvested in our public education systems which should be totally free from K-BA.
Most major organizations plan on how to attack their major cause of opposition. Some, such as our elephantine friends, are just more explicit about it.
The GOP has a long and venerable anti-education tradition, going at least as far back as Spiro Agnew and his “effete corps of impudent snobs who characterize themselves as intellectuals” (2:02)
If you want something more explicit, there’s always President Richard Nixon — from the Oval Office — from the Oval Office in 1972 — directing Pat Buchanan (then a speech writer for Spiro Agnew) to have the Vice President attack the Presidents of the Ivy League colleges (1:48-2:46, emphasis mine):
President Richard Nixon (April 19, 1972):
The GOP has been against education and intellectualism for my entire adult life. They pander to the intentional ignorance of the creationists, the bigots, the misogynists, the climate-change deniers, and a host of similar mobs. As you observe, the more damage they do to education, the more they enlarge their base.
“venereal.”
n/m
The costs have increased dramatically, far ahead of inflation.
The value of the outcome, a degree of some sort, is declining (this is an aggregate claim, of course a degree makes you more money than not having one, but the quality of the job the degree gets you is less than it once was).
The government make no determination of value, and so will even pay (I”m thinking veterans programs here) for those for-profit colleges that provide degrees or courses that don’t help the student.
Students can major in anything, while some jobs can only be filled with workers from abroad.
Colleges are not even efficient job creators, because a select group make six figures plus, while adjunct professors make $3000 for a course.
Oh, and the service delivery model is still the same as it has been for decades, if not centuries.
Yet there is only discussion of how to change this on the periphery, no real public debate as yet.
Everyone gets up and says kids need more education to get ahead, and I don’t disagree. I just think that the way higher ed is currently configured is not getting the results we need/want, and there should be change.
I agree with you that education costs are out of control. We have a major crisis brewing in our higher education funding.
Nevertheless, that is a different problem from this. The problem here, in my view, is (as Senator Warren has clearly articulated) that even at the existing loan rates, we are charging low- and working-class students far more than our several too-big-to-fail banks for federal loans. There is no good reason why students from these families should be paying more (or, if nothing is done, far more) than those banks.
Yes, let’s address the problem of runaway higher education costs. In the meantime, we should not plunder already-struggling students and families who are the victims of this problem.
although not lockstep, clearly the availability of student loans at lower prices does a number of things:
* in the near term, allows those with less wealth/income to go to college
* in the long term, allows the price of college to increase faster than inflation
How to deal with it? The United States runs three undergraduate universities as far as I can tell — West Point, Annapolis, and Colorado Sprinks (aka United States Military Academy, United States Naval Academy, and United States Air Force Academy). Those schools are fully subsidized, but the attendees have to agree to some pretty important terms of employment immediately following graduation.
Why not use this model and build some more colleges? Instead of university education combined with military training, why not have university education focused on some key other areas important for the health and well being of the United States of America? Health care, IT, education, law enforcement, lots of things. Focus on undergraduate degree programs where America has a real need. Tuition, room, board — covered. Now, here’s the deal: when you graduate, just like with the service academies, you’ve got to work for the government. Either directly (as a civil servant), or indirectly (as a nurse in an underserved community hospital, for example). You don’t have to pay back the cost of your education, but you do need to serve, and probably at a relatively low salary for those years. It’s really not much different *in concept* from a military academy. The job is different, obviously the risks are different, and I’m certainly not suggesting that one should need a letter from a Congressman to go to a National University.
I’m not suggesting that we build gazillions of these. Ten would go a long way. It would provide competitive pressure on state universities (whose tuition is far too high) and on private schools both. I think that it would help push tuition downward, would help Americans of all backgrounds get both education and relevant job training, and help America ensure that it’s got a workforce with the skills necessary for us to be successful in the 21st century. And, if I had my druthers, these National Universities would be banned from intercollegiate athletics. Intramurals are great, but I’m not interested in subsidizing semi-professional athletics.