Aiming High: The Keeping College Affordable Initiative

By Watson Scott Swail, President & CEO, Educational Policy Institute/EPI International

This morning, President Obama used the setting of staff and students at the University of Michigan to unveil his Keeping College Affordable initiative. Based on his State of the Union speech a few nights ago, we knew this was coming and we knew mostly what it was about, and as Secretary of Education Arne Duncan said earlier this morning on MSNBC’s Morning Joe, the initiative would involve both carrots and sticks.

There are several components of the initiative, but the most salient feature is a $1 billion incentive* fund to entice institutions to keep costs down (the carrot). This program is patterned after the K-12 Race to the Top program, which has provided incentive funding to states. The “stick” is the President’s warning to institutions that if they don’t bring tuition fees within reason, Congress will act. “You can’t assume that you’ll just jack up tuition every single year. If you can’t stop tuition from going up, then the funding you get from taxpayers each year will go down.”

It is easy to be cynical about these changes. Because the US higher education system is so large and complex, attempting to make a real and positive change in this system is inordinately difficult; perhaps impossible. Understand that this “system” has over 2,000 public institutions alone, another 2,000 private, non-profits, and thousands of other proprietary institutions. The public institutions run under the auspices of 50 state governments who have the final say on what happens. But the federal government has some leverage through Title IV (student aid) and research funds. Already, Title IV aid is used as a lever to get institutions to complete IPEDs surveys each year (if institutions don’t complete, they don’t get federal student aid funds, including Pell, Direct Loans, and Work Study).

So how, exactly, will the Administration apply stated stick to the institutions? It can reduce the amount of Title IV money that an institution gets, but that, in most ways, would hurt students as much as institutions. So that doesn’t work particularly well. They could reduce research funding (i.e., if they do not comply, then no NASA, NIH, NSF, or Defense funds), which would have an impact, but only on Research I and II institutions, for the most part.

As expected, there is already critical commentary on the President’s Initiative. The President of the American Council on Education, Molly Corbett Broad, said that the President’s proposal would “move decision-making in higher education from college campuses to Washington, D.C.” Of course, ACE’s role is to protect university presidents and their institutions. Former Secretary of Education and current Senator Lamar Alexander, questioned whether these programs would end up hurting students.

The interesting piece is that Alexander’s colleague, Buck McKeon, suggested almost the same type of thing over a dozen years ago. That is the last time that Congress or the Administration threatened (yes, this is a threat by the President) the higher education establishment. So, this isn’t anything new. But nothing happened then because it because clear it would be difficult to actuate any of these proposals in a way that (a) didn’t completely usurp policy control from the states; and (b) didn’t hurt students.

Many of us—perhaps most of us—agree completely with what the President is trying to do. As he said, his goal is ensure that institutions set “responsible tuition policy,” provide a “quality education and training” to students, and ensure that “low-income students” enroll and graduate at higher rates. All of this is laudable and these should be education policy focuses for higher education. But without the states coming along for the ride, the feds will be limited in what they can do to shift hundreds of years of institutional culture. That’s where the RTTT comes in.

The President is also proposing a special “First in the World” competition ($55 million) for institutions and non-profits to develop cutting edge strategies to reduce cost and improve access and completion.

 The President said that “Higher education is not a luxury. It’s an economic imperative that every family in America should be able to afford.”

He’s right. And while the Administration, through its proposals, clearly understands that this is really about the cost drivers of education and less about price, this is a difficult task to do from the federal level. In an election year, don’t expect much to happen. But let’s keep watching.


*Incentivize still shouldn’t be a word, and it is ugly whenever someone uses it, especially a politician.

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