Higher Ed Reforms Face Tough Slog

Published December 1, 2006

On September 27, one day after U.S. Secretary of Education Margaret Spellings announced major plans to reform American postsecondary education, a panel of higher education analysts, stakeholders, and advocates–this author included–convened at the Cato Institute in Washington, DC to debate her proposals.

If our discussion was any indication, renovating America’s ivory tower is going to be a tough job. The secretary’s proposals fell under much criticism at the Cato panel and elsewhere.

Creating a Commission

Spellings’ road to reform started in September 2005, when she appointed a commission to formulate a “national strategy” for American higher education. Charles Miller, a friend of Spellings and President George W. Bush who had helped craft Texas’ predecessor to the No Child Left Behind Act, and who once chaired the University of Texas board of regents, was named the group’s chairman.

The rest of the commission was composed of current and former university presidents, heads of higher education advocacy groups, and representatives from corporations such as IBM and Boeing. For nearly a year the commission tackled numerous topics in hearings around the country.

At the end of August 2006, all but one commission member voted to approve a final report that called for increasing aid to poor students, encouraging colleges to measure student learning over time, and creating a federal database with information on every postsecondary student in the nation.

Preparing a Response

A month passed between the report’s approval and its presentation to the secretary, but Spellings started planning her response well before its official release.

When Spellings received the report on September 26, she had a plan ready to go. She announced the administration would focus primarily on better aligning high school curricula with college entry requirements, increasing need-based financial aid, and creating a database to track the performance of every college student–and therefore every college–in the country.

Miller was the first speaker at Cato’s event. He stressed the need to gather and publicize as much data on colleges as possible, with the goal of enabling students, parents, and policymakers to make informed decisions about higher education.

“It’s necessary to have an information system which provides results and identifies behavior related to those results,” Miller said. “Currently, higher education is replete with opaque, complex information systems which are not informative.”

Publicizing Personal Data

The problem with Miller’s focus, and with the database both the commission and Spellings endorsed, is that it would require schools to furnish information many institutions and students consider private.

In addition, the threat that the federal government might eventually require schools to give standardized tests to all students troubles many colleges, especially private schools that value their autonomy.

Christopher Nelson, president of Saint John’s College in Annapolis, Maryland, made those fears clear at the Cato event, voicing an opinion the National Association of Independent Colleges and Universities had been articulating long before the report’s release.

“We should promote the desire to learn over the mania to test performance,” Nelson said.

Aiding and Abetting

The second major hurdle for higher education reformers will be to address what is likely the ivory tower’s greatest problem: affordability. How do you ground tuition prices that for decades have grown at rates exceeding even inflation in health care?

For the commission and Spellings, the answer is to target aid much more precisely to the poor. But Anya Kamenetz, author of the book Generation Debt (Riverhead Books, 2006), focused on a broader swath of Americans at Cato’s panel, noting loans are becoming increasingly larger parts of financial aid packages, and that lending companies such as Sallie Mae are making huge profits off of them.

Increasing Federal Aid

To make college more affordable for all Americans, Kamenetz called not just for the expansion of Pell Grants but also for the replacement of federal programs that back loans from lending companies, with initiatives that give federal money directly to students.

“It’s really an elephant in the room when you talk about issues like transparency and accountability,” Kamenetz said. “That is the external system that is fed by the federal financial aid programs that cause very large companies to make very large amounts of profits off of growing student loans.”

The federal government, however, has been increasing overall aid availability for decades, yet college prices keep rising. Indeed, as I argued at the event, such aid could very well be the problem: As long as it keeps on rising to keep up with prices, schools have no incentives to keep their tuition increases small.

Public realization of that, colliding with students’ and schools’ desires to keep aid coming, might easily spell even greater gridlock for ivory tower reform than disputes over federal data collection and No Child Left Behind for colleges.

Together, these problems leave very much in doubt whether anyone in Washington will be able to renovate the nation’s ivory tower.

Neal McCluskey ([email protected]) is a policy analyst at the Cato Institute’s Center for Educational Freedom.

For more information …

Webcast of Cato panel, http://www.cato.org/event.php?eventid=3193

A Test of Leadership: Charting the Future of U.S. Higher Education, published by the U.S. Department of Education in September 2006, is available through PolicyBot™, The Heartland Institute’s free online research database. Point your Web browser to http://www.policybot.org and search for document #20152.

“Commission Recommends Higher Education Reforms,” by Karla Dial, School Reform News, October 2006, http://www.heartland.org/Article.cfm?artId=19781

Generation Debt, by Anya Kamenetz, Riverhead Books, 2006, http://www.amazon.com/Generation-Debt-Anya-Kamenetz/dp/1594489076/sr=1-1/qid=1161871450/ref=pd_bbs_1/104-4265460-0001545?ie=UTF8&s=books,