New policy brief: How should we hold universities accountable for prices and outcomes? Here are some principles for reform. 🧵
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Preston Cooper 
@PrestonCooper93
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The REAL Reforms Act introduced by this month is an excellent start but loan forgiveness should push Republicans to go much, much further
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"The argument for debt cancellation is based on the premise that students are worse off with debt, even if they used that debt to earn a degree. It follows that many of the degrees and certificates financed by debt are not financially worth it and should be discontinued."
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What Republicans should do if Biden forgives $10,000 in student loans per borrower:
➡️End federal graduate loans
➡️End federal parent loans
➡️Impose penalties on undergrad colleges where students' incomes are insufficient to repay debts
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Rumor has it that the Biden Admin may cave to the Twitterati & announce blanket debt cancellation tomorrow.
If they do, it will be a HUGE mistake, both substantively and politically. Here's why.
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If you told me Biden was looking for a policy that would boost inflation, provide most of its benefits to the upper-middle class, and undo the fiscal achievement of his recently passed IRA, I wouldn't believe you, yet that's where we are w/ tomorrow's student loan announcement
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This is what, the third time they’ve called an extension of the pause the “final” extension?
It’s like naming Word files. “Super duper final final FINAL extension FINAL.”
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We reported today WH officials have been discussing coupling the $10K w/ a temporary & final extension in the moratorium, but Biden's final decision remains unclear
washingtonpost.com/us-policy/2022
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$10K per borrower, of course, is only the beginning.
Every Dem president from now until the end of time will try to one-up each other on loan forgiveness by EO.
Only Congress can act to stop this.
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UPDATE: President Biden's long-awaited student loan announcement IS coming tomorrow, ppl tell me & @DaniDougPost
Parameters TBD but WH has been looking at $10K in cancelation per borrower under $125K/yr
(1st reported by @josh_wingrove & @nancook)
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Debt cancelation + no further reforms is a massive gift to wealthy universities.
They continue to collect billions/year in student loan funding, while the debt cancelation precedent makes it easier to hike tuition.
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No amount of cancelation would solve the root problem.
The US is on track to make over $1 trillion in **new** loans over the coming decade, cancelation or no cancelation.
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Cancelling only $10,000 doesn't solve the root problem (which is the whole point), they say, and also shows that Biden has the executive power to do more, but won't.
twitter.com/ninaturner/sta
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House Republicans introduced a bill earlier this month to cap student loan interest charges. Wild that it hardly got any attention! forbes.com/sites/prestonc
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Instead of paying off a chunk of loans, we should offer relief in the form of permanent interest rate deduction. That’s what really breaks my heart reading the stories — people working their tails off for a decade making payments and they barely dent the principal.
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Obligatory note that our higher ed model still has lots of problems but it’s light years better than K12
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Imagine if our higher ed policy was “everyone has to go to the public institution nearest their home, whether that’s a community college or an R1 university. If you want something else you have to pay 100% out of pocket.”
That’s what we do for K12!
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Wild that Democrats stridently oppose vouchers at the K-12 level, yet simultaneously call to double the size of the federal government’s flagship voucher program for higher ed.
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The Pell Grant is about expanding opportunity through higher education & helping hardworking students afford to pay for college. 50 years in, it’s time to double the power of Pell grants to uplift future generations & ensure they too can afford to achieve their potential.
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Kilwa, the abandoned East African city, once controlled the medieval gold trade nationalgeographic.com/history/histor via
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Foundation for Research on Equal Opportunity joins Neil on Biden to decide on student loan forgiveness
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Me: do I have to pay my student loans on Sept 1 or not
US Govt: it’s surprise 😝
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The District of Columbia - which already has the most expensive child care in the nation - is going to further restrict the supply of care providers by imposing a senseless college degree requirement.
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“A study on the impact of child care regulations found that imposing just minimum educational requirements on staff reduced the number of child care centers in associated markets.”
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Extending the student loan payment pause to the end of the year would completely wipe out the deficit reduction effects of the Inflation Reduction Act for the next **six years**: crfb.org/blogs/cancelli
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Probably goes without saying, but this isn't true.
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FYI—Student debt cancelation isn’t paid for by the taxpayers, the federal government is the lender.
It’s costlier for the government to hold on to the debt.
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What is the plan for the day after universal debt cancellation when masters programs raise tuition and tell prospective students not to worry about it because the debt will be cancelled down the road?
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Replying to
One of the things that most puzzles me: most of these folks see damaging monopolies/monopsonies EVERYWHERE (usually where there aren't any), yet when you bring up the obvs govt school monopoly/monopsony and its obvs problems, they're all like
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"The largest drug companies are only one-fifth as efficient as the overall industry in R&D. The big companies spend $5 billion per newly developed homegrown drug; the industry average is closer to $1 billion."
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"Perversely, the Medicare program handsomely rewards large, low-innovation companies to the tune of hundreds of billions of dollars. That’s not how free markets are supposed to work." washingtonpost.com/opinions/2022/
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🚨ANALYSIS🚨 - If the cancels student debt, it will wipe out virtually ALL of the fiscal and inflationary gains from the Inflation Reduction Act. crfb.org/blogs/cancelin
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“ … vocational schools and work-based learning programs. The main question before us is how to ensure those alternatives operate on a level playing field with traditional colleges and universities.”
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“What students want most from college is economic mobility—they want to be able to get a job that pays a decent salary. But there’s no reason that economic mobility has to come from a college. There are many promising alternatives—apprenticeships, short-term ‘bootcamps,’ …
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I was pleased to join for a conversation on the value of college and the future of higher education.
Also featuring , among others - good company!
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Can’t make this up - the supposedly brand new Silver Line has been sitting unused for so long that the rails are rusting.
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NEW:Metro’s safety training drill is turning up some issues with the rail along the second phase of the Silver Line. The rails have been sitting for so long, that many are rusted - meaning some safety equipment is having a hard time “connecting” to the rails #wmata @nbcwashington
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That’s all for now. You can read the complete bill here: republicans-edlabor.house.gov/uploadedfiles/
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There’s also an expansion of Pell Grants to short-term programs, with some guardrails based on student outcomes. I think this is a cool proposal and I want to save my thoughts on it for a separate piece - look out for that soon!
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I’d also like to see some accountability for colleges & universities dependent on federal loans. Loan limits are great, but not enough to purge low-quality programs from the taxpayer dime.
Some ideas on that front:
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I suggest lowering graduate loan limits to $12,500–the maximum amount allowed for independent undergraduates. (Of course, $0 would be even better!)
Grad students have more access to credit on the private market - they don’t need higher federal loan limits than undergrads.
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This bill has a lot to like. But I think it could go further.
In particular the $25,000/year cap on graduate loans is probably too high to have the intended impact on tuition and fiscal costs. It also probably won’t do enough to pop the bubble in crappy master’s degrees.
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The bill also saves some $$ by ending PSLF for new borrowers.
This is likely to be controversial. But as I argued recently PSLF isn’t a great way to reward public service. It’s poorly targeted and creates perverse incentives.
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Some other cost savings: the bill would take away ED’s power to modify student loans in ways that increase costs to the government.
For instance, the Biden admin’s new plan to expand loan forgiveness to the tune of $85bn? No longer allowed, without Congressional say-so.
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