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Hudson ’14: Obama’s college plan — Big Brother knows just the right college for you

By
Opinions Columnist

We’re told that graduating from college is the road to success. But college degrees are crippling graduates. Average tuition at a private four-year college is $28,280, and average in-state tuition at a public university is $8,370. Nationally, graduates of the class of 2011 held on average $26,500 in debt as of late 2012.  Shockingly, only 37 percent of student-loan borrowers between 2004 and 2009 avoided postponing payments or becoming delinquent. Something should be done about the cost of college, but the question is: What?

Tuition hikes are out of sync with many other sectors of the economy that have experienced falling prices. For example, an Apple computer dropped 78 percent in price from 1977 to 2010 while its processing speed increased by a factor of 3,000 and its RAM storage by a factor of 87,375. Unlike computers, college costs have skyrocketed with unclear benefits to students. I’ve written on this subject before (“Major in debt,” Oct. 10, 2012), but recent developments warrant further debate.

In late August, President Obama proposed a new plan to reduce the cost of college. While some popular publications produce college rankings, such as Forbes’ “America’s Top Colleges,” a government ranking is unprecedented. The Department of Education would determine the rankings based on factors such as tuition, debt of graduates and earnings of graduates. In theory, the rankings would help students select colleges that offer good value for their money.

But the rankings are not merely advice to families. The rankings prod Americans into picking particular colleges. The prodding isn’t done by law, but by economic incentive: The plan links the roughly $150 billion in annual federal student aid to the new rankings. Students receive greater financial aid the higher the rank of their college. Considering government loans account for over 85 percent of the student-loan market, Obama’s proposal would have a major impact on where students attend college.

Publicity for the plan may induce families to think harder about whether to send a child to college, and if so, how much to pay. On the plus side, the plan shows the president is giving some attention to issues that affect American families, rather than to foreign conflicts of no significance to Americans.

On the whole, however, the plan won’t treat the problem. The plan does not address the cause of the rising cost of college. College is increasingly expensive because of bottomless demand for college degrees. This demand allows colleges to continue increasing prices, knowing that students will be able and willing to take out greater loans from the government — loans at risky rates that private companies cannot afford to offer. The possibility of student default does not concern colleges, since the taxpayers absorb the loss on nonpayments.

The solution to the spiraling price of college is to end government-backed student loans. Consider what might happen if loans were abolished. No, every man, woman and child would not be starving in the streets. Instead, demand would evaporate since very few could afford current prices without loans. To stay in business, colleges would be forced to slash costs to attract students. Colleges would no longer compete for students on the basis of fancy gyms, dorms and dining halls. Instead, colleges would have to offer a great value for money. Students would benefit, especially students taking on large debt.

Some would argue that colleges won’t be able to reduce costs enough to be affordable to poorer Americans. This is untrue. With loans out of the picture, there would be a powerful new market force for low-cost college education. No frills, no larger-than-Olympic-sized pool — just knowledge.

More disturbing than the economics of the president’s plan is the plan’s attempt to control behavior. The plan guides student behavior by granting students more money for attending the Department of Education’s preferred colleges. This concept of government-driven behavior is not new. Unfortunately, it exists everywhere. The reason why your last soda contained high-fructose corn syrup rather than real sugar is that the government heavily subsidizes American farmers, discouraging sugar imports.

Shaping young Americans’ educations, however, is much more serious than shaping their stomachs. By strongly influencing where students attend college, the government could control what students learn and how they think. Professors or student bodies critical of the government might mysteriously find their college at a lower rank. Politically unpopular research might provoke a rank demotion, whereas research that allegedly proves the government’s positions might bring a higher rank to a college. Students might graduate from college conditioned to agree with certain beliefs, rather than able to think for themselves. The countless ways to abuse the program are too great a temptation for those in power. In a mild form, this proposal is a threat to academic freedom and individual thought. In an extreme form, it could become a dictator’s youth training program.

Keeping college cheaper and free of political influence should be the aim of reform. The president’s college proposal therefore deserves to be scrapped.

 

Oliver Hudson ’14 hopes to never be forced into re-education camp. He has written about this issue before.