Student Loans

Where Are the Republicans on College Costs?

Democrats have plans that obscure the real problems, but speak to the outrage.


"We cancelled all the economics classes first, so they'll never figure it out."
Credit: COD Newsroom / photo on flickr

The Democratic presidential candidates clearly intend to keep the high cost of a college education—and their solutions—part of the debate leading up to the 2016 election. Several candidates have put forward detailed plans that are above and beyond the early "talking point" state of the race.

The Republican candidates are willing to speak critically of these plans in order to attack their ideological foes, but their chosen focus has been on foreign policy, abortion, and fighting terrorism. There are policy ideas among Republicans to deal with college costs, but they're much less formalized than what Hillary Clinton has presented this week. And Clinton is infamous for being tough to pin down on issues.

Perhaps the candidates are less concerned because there's little evidence these extremely broad, expensive college spending plans have a possibility to pass. These plans may not be seen seriously, but that doesn't mean these populist-oriented proposals can't capture votes and subsequently create pressure for Congress to do something that could ultimately make the problems even worse. Without some alternative concrete proposals by Republican leaders, they could end up back where they were with Obamacare: trying to beat back bad regulations without being able to answer the question, "Well, what should we do instead, then?"

Here's what Democratic candidates are suggesting:

  • Hillary Clinton. Clinton released her proposal on Monday. She would spend $350 billion dollars over 10 years. A good chunk of that money would go to states who agree to increase their own college spending and somehow guarantee that students will be able to attend school without having to take loans to cover tuition. Students with college debt would be able to refinance their loans at lower rates. Colleges would also be on the hook for part of the cost of student loans if their graduates can't find jobs. She has made President Barack Obama's proposal for free community college part of her "New College Compact" as well. She wants to more than triple the size of AmeriCorps from 75,000 members to 250,000 and expand loan forgiveness opportunities to those who participate. Her plan would be paid for by putting a cap on some itemized deductions for high-income families.
  • Bernie Sanders. Sanders has introduced the "College for All Act," which would eliminate tuition at all four-year public colleges and universities. The federal government would pay two-thirds of the tuition costs. States would be responsible for one-third. The legislation would forbid the use of the money to pay administrator salaries, merit-based financial aid, and the construction of non-academic buildings. It would lower student loan rates and allow borrowers to refinance. Sanders plan would be paid for by imposing new fees on Wall Street activities.
  • Martin O'Malley. The former Maryland governor has highlighted his own plan to fight college debt on his site, also calling for borrowers to be allowed to refinance their loans at better rates. He also calls for caps on monthly payments. He calls for trying to rein in ballooning costs by tying federal aid to schools' performance on directing financial assistance to those who truly need it or by "rewarding schools that excel at making college affordable."

Candidates Jim Webb and Lincoln Chafee have not made college debt proposals part of their campaign sites, but Webb has called for students to be able to turn to a period of public service to pay of loans, while Chafee, as governor of Rhode Island, called for increases in college spending to keep tuitions frozen.

The plan of attack for Clinton now appears to be hitting at Republicans for state-level cuts to college budgets. She went after both Gov. Scott Walker and Jeb Bush for the high cost of colleges in their states. Walker responded by pointing out that he froze tuition (and noted that Clinton's speaking fees for colleges could pay for seven student's loans apiece). Bush responded by noting that Florida had the lowest in-state tuitions in the country when he left office. (This debate also mostly ignores the fact that colleges historically respond to tuition freezes by just recasting them as "fees" that are subsequently jacked up.)

Clinton's proposal is clearly influenced by reports like those of the Center on Budget and Policy Priorities (CBPP), arguing that political commitment to higher education can be measured entirely on the terms of how much money is spent per student. Tuition is increasing because states had to cut college spending during the recession. College enrollment also went up during the early parts of the recession, which also drove down the dollar-per-student spending.

The big flaw in the CBPP report is what it doesn't talk about. Note how it describes how colleges have dealt with funding cuts:

Tuition increases have compensated for only part of the revenue loss resulting from state funding cuts.  Over the past several years, public colleges and universities have cut faculty positions, eliminated course offerings, closed campuses, shut computer labs, and reduced library services, among other cuts.

What's left off the list of cuts? Administration and professional staffing. Over the past 25 years, colleges have added hundreds of thousands of administrators and non-education positions, even while it has made those cuts to faculty and shifted teaching to part-time staff. The increase in the number of non-faculty college employees has grown twice as fast as student enrollment, according to the New England Center for Investigative Reporting.

The Washington Monument Syndrome has packed up its beat-up Honda Civic and moved into the dorms. College administrators choose the most painful cuts that impact its students the most (but not themselves!) and then argue that the problem is that they aren't given even more money.

Republican candidates for president see full well the economic disaster embedded in Clinton's plan. A massive federal funding infusion, tied to a promise by states to increase their own college funding, does nothing at all to deal with administrative bloat. Furthermore, Clinton's college proposal promises incentives to increase non-educational services at colleges in order to draw in more students. She actually promises even more college staff not engaged in the education of its students.

So Sen. Marco Rubio and Bush called out her proposal for what it is, a massive tax-and-spend program that won't fix the problem at all. Rubio responded to The New York Times by calling for more alternatives to traditional four-year college programs and more competition and flexibility to help working-class people. Bush vaguely said they needed to "change the incentives for colleges with fresh policies that result in more individualization and choices, drive down overall costs, and improve the value of a college degree… ."

But that doesn't actually indicate any sort of policy in response to Clinton's untenable proposal. Right now, Republican market-friendly ideas for higher education lack the specifics of plans like Clinton's or even Sanders'. Here's how the Republican Party approached rising higher education costs in its 2012 platform:

The first step is to acknowledge the need for change when the status quo is not working. New systems of learning are needed to compete with traditional four-year colleges: expanded community colleges and technical institutions, private training schools, online universities, life-long learning, and work-based learning in the private sector. New models for acquiring advanced skills will be ever more important in the rapidly changing economy of the twenty-first century, especially in science, technology, engineering, and math. Public policy should advance the affordability, innovation, and transparency needed to address all these challenges and to make accessible to everyone the emerging alternatives, with their lower cost degrees, to traditional college attendance.

Federal student aid is on an unsustainable path, and efforts should be taken to provide families with greater transparency and the information they need to make prudent choices about a student's future: completion rates, repayment rates, future earnings, and other factors that may affect their decisions. The federal government should not be in the business of originating student loans; however, it should serve as an insurance guarantor for the private sector as they offer loans to students. Private sector participation in student financing should be welcomed. Any regulation that drives tuition costs higher must be reevaluated to balance its worth against its negative impact on students and their parents.

There's a significant public message challenge here: How exactly does a candidate sell the idea that the solution to rising college costs is actually to refuse to give colleges more money? The argument being advanced by Clinton and CBPP is that the problem with college costs is that government literally isn't giving them enough of other people's money, and therefore people are having to pay for their own educations. This is being presented as some form of cruelty—because college is so expensive. But basic knowledge of economics and government spending should make it all but obvious that it's the government spending itself that is driving up college costs. The Democrats are actually the ones who should be politically vulnerable about today's college education prices. The largesse they have promised to universities has been taken from the taxpayers (the ones who end up having to take out the college loans) and directed into the pockets to this growing horde of administrators, who then turn around to and donate primarily to the Democratic Party. Clinton's plan should be properly seen as a payoff to part of her electoral base, not a solution.

It's important, then, for the Republican Party and its candidates to remain engaged in this debate, not necessarily as a path of winning the presidency, but rather to prevent some really bad ideas from becoming the default solution in the public's eyes. They need to be putting Democratic candidates on the defensive about how the college bubble actually occurred and their roles in it. And because this is such a hot topic in the public, candidates might want to ponder moere formal plans. Consider what happened with the Affordable Care Act. We've been stuck with these terrible insurance policies for a number of reasons, but among them was the failure of Republican leaders to advance compelling alternatives.

Republicans should learn from that experience. These plans are terrible, but don't assume they're so bad that they cannot pass. People are very emotional about the cost of college, and emotional appeals lead to bad legislation. The way America handles medicine has resulted in health insurers being treated like the actual customers of hospitals and doctors. The patients themselves are treated like broken machines to be repaired (or not!) based on the insurer's desires. Democratic college proposals are turning the government, both state and federal, into the actual customers the schools are serving. They're the ones providing the money. The students themselves are the product being manufactured based on a host of federal mandates with lots of financial strings attached.