Obama would want to tie federal aid to metrics such as how many students from disadvantaged backgrounds are served, average tuition, scholarships and loan debt, and graduation and employment outcomes. That would mean the lower the tuition, the more scholarship and grant monies exist, the higher the proportion of minority and poor students, the higher the graduation rate, and the higher post-graduation salaries are, the more money they would get, primarily through the federal loans students could get to attend that school. Other elements he supports would be creating a national scorecard of schools to publicize records, incentives to create competency-based and accelerated learning, and to cap loan paybacks to a percentage of income.
In some ways, the basic strategy of accountability mirrors what has been going on in Louisiana over the past few years, where state assistance is tied to its public universities and colleges abilities’ to reach performance targets. As such, it suffers from the same drawback that minimizes the effectiveness of this reform: gamesmanship by schools in setting reachable targets and pressure on them to lower standards in order to reach targets such as graduation and retention rates.
The end result of Obama’s plan would create a ghettoized system of higher education more under the thumb of government. Schools in better financial situations would become more selective in admissions, in order to drive up completion rates and post-graduation statistics and render them more able to charge astronomical tuition rates. They also would favor minority applicants at the expense of non-minorities, increasing the prominence that race has in admission standards even as the judiciary slowly is moving away from that. Other schools, mainly non-flagship public universities, would lower standards in order to pump up graduation rates and attract students from the disadvantaged category who typically are less prepared to succeed in college.
It also would favor expansion of government by creating incentives to have state government pay more for higher education, reversing the recent trend in Louisiana and nationwide. Incentives would be to replace tuition as a source of revenue with state aid, either directly or indirectly through increased scholarship and grant offerings or their own lending or assistance programs such as Louisiana’s Taylor Opportunity Program for Scholars. Any way, it means more government spending, which means less spending elsewhere and/or higher taxes. And it subverts the most important incentive for college success, committing own resources, where especially among non-elite students the more of a student’s own resources are put into education, the better they do in college (or, conversely, as the proportion of their overall resources increases in commitment to college, the better they do).
Obama came up with these ideas because of the escalating costs of going to college, which have far outstripped inflation but only partially because of an increase in emphasis on tuition as a source to pay for it, and an increasing student loan burden. But they entirely miss the point about why the costs have been going up: allowing higher education to serve as a barrier of entry to many occupations and flooding the higher education lending market with money.
Over four decades ago, the U.S. Supreme Court ruled that intelligence tests could not be used as a means to determine general employment hiring decisions, on the basis that tests not specific to a job had an adverse impact on minorities’ job prospects, given the inconvenient situation that different ethnic groups on average scored better or worse than others. Thus, the idea of credentialing rather than testing to demonstrate overall aptitude for success in more-demanding occupations came about, providing a boon for higher education. This was fueled by the decision a few years earlier for the federal government to provide, with policy eventually deeming essentially without limit for public schools, money to be lent for higher education.
By allowing higher education to become a gatekeeper through a credentialing monopoly and by permitting borrowing to pay essentially for any amount charged of state school tuition, this created a bubble that has wrought inefficiency in higher education and its insulation from societal demands. Therefore, to reduce the cost of college, its ability to set prices must be challenged by market forces, providing competition to induce more efficiency and responsiveness than is forthcoming from it in its semi-shielded present position.
This means instead of tying lending to results rather to turn down the lending spigot to reduce the favored subsidization. Then schools would have to pick and choose more carefully what areas of study they promote and how they do it. Money would not be spent on trendier activities and areas of study, guiding students to areas with better employment prospects. Greater teaching productivity would be demanded of faculty members, and they would receive priority over administrator staffing choices. The only drawback might be pressure to reduce offerings in the traditional components of a liberal arts education that are designed generally to improve critical thinking ability generally, rather than convey career-specific knowledge.
Yet that erosion can be prevented, and in fact reversed, by evolution in judicial thinking that moots the previous declaration than general intelligence testing for jobs by definition is discriminatory. A 2009 decision already may have opened the door for that. Understand that the vast majority of employers with higher-level job offerings would not solely depend upon, or even partially base, hiring decisions on the basis of an IQ test score because of the nature of the jobs. Especially where there is professional certification involved, higher education provides an optimal method of putting a student in position to earn that credential in order to take a certain kind of job.
But for some, there’s no reason an aptitude test cannot replace a college degree as a requirement. This only encourages students to go to college when it may not be necessary for their ambitions, and tends to create an oversupply in trendier major areas of study that are less rigorous in their bodies of knowledge and critical thinking demanded from them because a degree is a degree is a degree for some employment purposes. End that privileged position of colleges here and they will deploy their resources more efficiently – with one result being a boost in enrollment in the traditional liberal arts and sciences precisely because those have great potential to inculcate superior critical thinking ability that would score well on an IQ test.
Naturally, higher education would resist these kinds of reforms because they take away their price-setting, demand-determining abilities that would expose the enterprise as, generally speaking, overbuilt, with a consequential loss of resources and jobs. But if you want genuinely to make higher education operate more efficiently and to increase the chances of all students graduating from it being sufficiently able to think critically – as Louisiana’s changes marginally do – much of Obama’s plan misses entirely as it does not address these fundamental aspects of higher education in America today that would accomplish these goals.