Spread the word!

Obama's Whack-a-Mole Approach to Higher Ed

Yesterday, in the middle of a packed auditorium at SUNY's Binghamton University, President Obama laid out a number of proposals aimed at reforming the U.S. system of higher education.

You'd be forgiven for a sense of déja vu, as the ideas Obama discussed have been brought up before, notably in his 2012 State of the Union Address (which I covered here). The difference this time is that the Department of Education has had another year and a half to flesh out the details.

The Administration has lumped together these otherwise scattershot reforms into three categories:

Pay Colleges and Students for Performance

  • Tie financial aid to college performance, starting with publishing new college ratings before the 2015 school year.
  • Challenge states to fund public colleges based on performance.
  • Hold students and colleges receiving student aid responsible for making progress toward a degree.

Promoting Innovation and Competition

  • Challenge colleges to offer students a greater range of affordable, high-quality options than they do today.
  • Give consumers clear, transparent information on college performance to help them make the decisions that work best for them.
  • Encourage innovation by stripping away unnecessary regulations.

Ensuring that Student Debt Remains Affordable

  • Help ensure borrowers can afford their federal student loan debt by allowing all borrowers to cap their payments at 10 percent of their monthly income.
  • Reach out to struggling borrowers to ensure that they are aware of the flexible options available to help them to repay their debt.

Please, I encourage you to take a look at their expanded bullet points to get a better idea of what they mean.

Rather than go point-by-point, I'd like to weave some of these proposals into a bigger picture.

Pay-for-performance has a long history in American K-12 education — a history riddled with failure and unintended consequences. First students were evaluated by test scores, then schools were evaluated by their students' test scores, and now teachers are evaluated by their students' test scores. The results have been disastrous: students' lives are dominated by test prep, budget-crunched schools cut arts and music programs that aren't included in standardized tests, and teachers are forced to throw pedagogy out the window because their very livelihood is based on their students' scores (often competing with their colleagues for job security and pay raises). And now it's heading to higher ed.

The obsession with quantification is a shackle generously gifted to us by titans of finance and industry, along with their allies in elective office. Just as employees should be measured by the quality of products they churn out, teachers and schools should be measured by quality of students they churn out. But students aren't products: an insight lost on economic elites, who can't seem to wrap their heads around the idea that even their own employees aren't expendable tools. Those teachers and schools who miss the mark on standardized tests are given the boot, to be replaced with charters or vouchers to private schools.

Quantification goes hand-in-hand with competition: once we've assigned everyone a number, why not force them to fight over scarce resources? That'll clearly improve everyone's performance!

The administration is vague on details about what criteria the ranking and funding will be based upon, but they throw out a few possibilities:

  • Access, such as percentage of students receiving Pell grants;
  • Affordability, such as average tuition, scholarships, and loan debt; and
  • Outcomes, such as graduation and transfer rates, graduate earnings, and advanced degrees of college graduates.

Okay, so judging from these three criteria, we can surmise that the White House wants universities that do well by poor students, keep cost to the student low, and send off lots of graduates who will then be successful in the real world.

Seems reasonable, right? In fact, I think you'd be hard-pressed to find a significant number of university presidents or state legislators who would tell you that they disagree with that goal. Then again, Wal-Mart executives wouldn't disagree with wanting businesses to treat their employees well and support their local communities, either.

So where's the disconnect?

Much of it stems from how modern liberals think institutions work, and how government can influence those institutions to achieve popular goals. Because those who are making higher ed decisions are often those least affected by them, there is a perennial disconnect between what is done and what should be done. University administrators and trustees more interested in prestige than affordability will squander millions of dollars on monuments, buildings, and landscaping, all the while feeling bad about having to raise tuition, cut tenure-track positions, and outsource staff. "If only we had more money," they sigh.

All the problems that the President outlined are correct: from tuition, to student debt, to graduation rates. But his solutions, far from being game-changers, are the definition of what he said he wanted to avoid: "tinkering around the edges." They're all incomplete and indirect measures to nudge institutions in a certain direction. And as any health insurance or finance executive can attest, regulations were made to be avoided and rating systems were made to be gamed. ObamaCare mandated that most employers provide insurance to full-time employees. What do employers do? Cut employees' hours down just enough to avoid the requirement. Congress puts an end to checking account overdraft charges? Banks add new fees elsewhere.

So long as the underlying logic of the institutions remain the same, we'll continue to play whack-a-mole, expending untold amounts of time and energy to put half-measures into place that they'll find a way to avoid. No matter how well-constructed (which very much remains to be seen), a brand new Federal college ranking system will likely introduce just as many distorted outcomes and incentives as the justly-maligned U.S. News & World Report rankings, outcomes and incentives that will need to be addressed by yet another round of regulations and reforms.

Our public universities don't need money with strings attached to it, right now they just need money. The staggering reduction in funds to higher education on the part of state legislatures has to be reversed: divvying up the budgetary equivalent of tablescraps to competing institutions, like Obama's "Race to the Top" program, is a recipe for short-sighted, desperate policy changes. Students don't need more manageable debt, first they need less debt: make it dischargeable in bankruptcy.

Funding aside, that the government has to force institutions to do what reasonable people think should be done anyway suggests not a lack of carrots and sticks, but a deeper institutional dysfunction. Can we envision a bank that is designed with the fundamental goal of not shitting on its customers? Just go down the street to your local credit union. Can we envision a business intrinsically designed to keep worker safety and well-being a top priority? Just visit your nearest worker cooperative. Can we envision a university that's first and foremost responsive to the needs and interests of students and faculty? Absolutely, but it'll look different from just about everything we have, and these proposals won't get us there.

Here are some other analyses of President Obama's proposals you should take a look at: