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The New Student Loan System: How Screwed Are We? [UPDATED]

"The word bipartisan means some larger-than-usual deception is being carried out." — George Carlin

To great establishment fanfare, the Bipartisan Student Loan Certainty Act has now passed both Houses of Congress, and should be signed by President Obama shortly. [UPDATE 1: President Obama has signed the bill.] This new law changes the previous regime of fixed interest rates and allows them to float — to a certain degree.

Now, the interest rate on your student loan will be set at whatever the 10-Year Treasury bill rate is, plus a fixed percentage. Here's the percentage breakdown, with the caps on how high the interest rate can get:

 Type of Loan Previous Rate New Rate Cap
Undergrad Stafford subsidized 3.4% (6.8% as of July 1) T-bill + 2.05% 8.25%
Undergrad Stafford unsubsidized 6.8% T-bill + 2.05% 8.25%
Grad Stafford 6.8% T-bill + 3.6% 9.5%
GradPLUS/Parent 7.9% T-bill + 4.6% 10.5%

You'll remember the great wailing and gnashing of teeth around the July 1 rate hike, particularly on the liberal/progressive side of the debate, when the 3.4% interest rate expired. It was a very similar to the wailing and gnashing of a year before, when the 3.4% rate was originally scheduled to expire. But because 2012 was an election year, we saw a very different outcome: both Obama and Romney came out in favor of extending the interest rate another year, and it passed both houses easily.

This year, without the pressures of a Presidential campaign, Congress let July 1 come and go without a fix. Given how malleable deadlines are with a legislative body that can pass laws with retroactive effect, as they did in this case, apocalyptic cut-off dates seem to have much more to do with public perception of lawmaking than with lawmaking itself.

Based on how low the T-bill rate is now, that means undergrads get a halfway decent deal this year: 3.86%, only slightly up from where it was before July 1st. However, there's a problem. The T-bill rate is not just low, it's historically, ludicrously low. The yearly average T-bill rate for the past two years has been so low that you'd have to go back to 1941 to find another that low. That means that the 3.86% rate will be gone very soon: according to rough CBO estimates, we could very likely see T-bill rates of 5.2% in 2017, which would bump up the interest rate of undergrad loans to a painful 7.4%.

While past results are no guarantee of future performance, it is the best benchmark we can go by. I've pulled together these stats, along with what the average student loan interest rate would have been over the past 20 and 30 years, had the new law been in effect then. The results aren't pretty (see the infographic below).

17 of the most reliably progressive and pro-student members of the Senate voted against the bill, along with 25 mostly progressive Democrats and 6 Republicans in the House. It makes one wonder why progressive student-oriented groups like Generation Progress (formerly Campus Progress) and Rock the Vote pushed so hard for the passage of a bill that 1) will make the student loan crisis worse, 2) will do nothing to help those straining under the $1.2 trillion in debt already out there, and 3) was hailed by Speaker Boehner as "almost identical" to what the House GOP wanted.

Perhaps it's because they're not democratically accountable to actual students? The United States Student Association's newly elected President, Sophia Zaman, has come out very publicly against it. [UPDATE 2: Kalwis Lo, Leg Director for USSA, co-penned a favorable statement about the bill's passing, in an apparent reversal of position. I imagine there's an interesting story behind this move.]

Some say that this is just a temporary stopgap, meant to help students now but will be fixed soon (some say as soon as this fall, when the Higher Education Act is up for renewal). Do we really need to remind these folks of the "pass it now, fix it later" slogan used to get progressives behind the Affordable Care Act? As Jon Walker put it:

Inertia is an overwhelming force in Washington. Things rarely get improved later even when politicians say improvement is needed. That is why it is so important to fight to get the design right to begin with, or we end of living with the design flaws for a very long time.

Student loan debt infographic

The 2013 State of the Union Preview: Higher Ed

For Student Power will be covering the SOTU live, via Twitter and Facebook. Join in!

The annual State of the Union Address is a key aspect of the political spectacle of the modern Presidency. While the SOTU is actually a codified mandate in the U.S. Constitution, only in the 20th Century has it become a regular (and now annual) speech delivered to Congress — previously it had generally been a written document sent and read by a clerk. While the first broadcast SOTU was Calvin Coolidge's in 1923, via radio, the Address' central position in American political life was cemented with the first TV broadcast of Harry Truman's speech in 1947.

It's in these addresses that Presidents announce new policy goals, attempt to shore up public support, try out new narrative and rhetorical frames to shape the political landscape for the coming year, and in most cases, assiduously avoid going into detail.

When it comes to Higher Education, the U.S. Federal government plays a much more hands-off role than most other nations. Because Federal support of public higher education has always assumed state establishment, regulation, and control (starting with the Morrill Land-Grant Acts of 1862 and 1890), much of what can be done at the Federal level has to do with funding. What little rule-making is done is usually in the context of eligibility tests for funds (like the atrocious Solomon Amendment).

The usual suspects in Federal higher ed policy debates are loan and grant programs — Pell, Stafford, Perkins, PLUS, etc. Proposals often deal with them at one or both ends: how much the students get, and how much they have to pay back. While there is usually tweaking of the size of Pell grants or Stafford Loans, nobody expects them to approach the percentage of tuition cost that they once did. One modest improvement enacted in 2010 is that Pell grant increases are now automatic, and pegged to the rate of inflation + 1%. That being said, Pell grants are now limited to 12 full-time semesters (down from 18), and the maximum award of $5,500 will now only be automatically granted is your family income is below $23,000 (down from $30k). In addition, for graduate students, Stafford Loans will no longer be subsidized (i.e. accrued interest is no longer waived during your time in school or during deferment). Bad news for the students who need financial support the most.

However, the biggest policy shift over the past four years has been the expansion and refinement of the Income-Based Repayment Plan (IBR). For those who can enroll, IBR caps loan payments at a percentage of your income and forgives whatever's left on the loan after a certain number of years (notably this does not apply to private loans, which can be the harshest burdens of all). As of right now, for most with student loans, IBR is capped at 15% of your income over 25 years. Congress changed that, so starting in 2014 (and for a select few qualifying students, right now) the cap will be 10% of your income over 20 years.

One danger that looms on the horizon for higher ed is the potential importation of the horrendous corporate-style ed reform currently infecting K-12 policy across the country. Pushing universal standardized tests on all colleges was a dream of the Bush Administration, and similar moves are being attempted in at the state level. Be on the lookout for "accountability" being posited as a solution to every ill, from high tuition costs to low graduate employment. 

Since this site is called "For Student Power" after all, I feel obligated to point out that issues of power never, ever come up in higher ed policy, and certainly never in a rhetorical event like a SOTU — except in the shallowest of forms, consumer power. Sure, we all rolled our eyes when Mitt Romney told students to "shop around" as a solution to the tuition and debt crisis. But how much better is Obama's vision? "Shop around — and here's a coupon, too." The closest he ever got to tackling tuition itself was the hilariously backward idea that universities should lower their tuition or face a reduction in federal funds and subsidies: a kind of punishment one could very well imagine a vulture capitalist like Romney coming up with.

There are lots of policies Obama could propose that actually would improve students' lives and create capacity for greater power. For example, he could mandate that student activity fees must be exclusively under the control of student-elected and -governed bodies (a hard-fought right that has steadily eroded away over the past few decades). Hell, that'd even help him and his party at the polls, since student governments and their larger associations often do a ton of voter registration and GOTV.

As for what Obama will say tonight, we can only guess — but to help us make an educated one, below are the relevant SOTU passages about higher ed for the last four years:

2009:

Because of this plan, families who are struggling to pay tuition costs will receive a $2,500 tax credit for all four years of college. 

In the wake of war and depression, the GI Bill sent a generation to college and created the largest middle-class in history.

And half of the students who begin college never finish.

This is a prescription for economic decline, because we know the countries that out-teach us today will out-compete us tomorrow.  That is why it will be the goal of this administration to ensure that every child has access to a complete and competitive education – from the day they are born to the day they begin a career.

We have made college affordable for nearly seven million more students.

And so tonight, I ask every American to commit to at least one year or more of higher education or career training.  This can be community college or a four-year school; vocational training or an apprenticeship.  But whatever the training may be, every American will need to get more than a high school diploma.  And dropping out of high school is no longer an option.  It’s not just quitting on yourself, it’s quitting on your country – and this country needs and values the talents of every American.  That is why we will provide the support necessary for you to complete college and meet a new goal:  by 2020, America will once again have the highest proportion of college graduates in the world.

I know that the price of tuition is higher than ever, which is why if you are willing to volunteer in your neighborhood or give back to your community or serve your country, we will make sure that you can afford a higher education.  And to encourage a renewed spirit of national service for this and future generations, I ask this Congress to send me the bipartisan legislation that bears the name of Senator Orrin Hatch as well as an American who has never stopped asking what he can do for his country – Senator Edward Kennedy.

2010:

Still, in this economy, a high school diploma no longer guarantees a good job. I urge the Senate to follow the House and pass a bill that will revitalize our community colleges, which are a career pathway to the children of so many working families. To make college more affordable, this bill will finally end the unwarranted taxpayer-subsidies that go to banks for student loans. Instead, let’s take that money and give families a $10,000 tax credit for four years of college and increase Pell Grants. And let’s tell another one million students that when they graduate, they will be required to pay only ten percent of their income on student loans, and all of their debt will be forgiven after twenty years – and forgiven after ten years if they choose a career in public service. Because in the United States of America, no one should go broke because they chose to go to college. And it’s time for colleges and universities to get serious about cutting their own costs – because they too have a responsibility to help solve this problem.

2011:

America has fallen to 9th in the proportion of young people with a college degree. And so the question is whether all of us – as citizens, and as parents – are willing to do what’s necessary to give every child a chance to succeed.

Of course, the education race doesn’t end with a high school diploma. To compete, higher education must be within reach of every American. That’s why we’ve ended the unwarranted taxpayer subsidies that went to banks, and used the savings to make college affordable for millions of students. And this year, I ask Congress to go further, and make permanent our tuition tax credit – worth $10,000 for four years of college.

Because people need to be able to train for new jobs and careers in today’s fast-changing economy, we are also revitalizing America’s community colleges. Last month, I saw the promise of these schools at Forsyth Tech in North Carolina. Many of the students there used to work in the surrounding factories that have since left town. One mother of two, a woman named Kathy Proctor, had worked in the furniture industry since she was 18 years old. And she told me she’s earning her degree in biotechnology now, at 55 years old, not just because the furniture jobs are gone, but because she wants to inspire her children to pursue their dreams too. As Kathy said, “I hope it tells them to never give up.”

If we take these steps – if we raise expectations for every child, and give them the best possible chance at an education, from the day they’re born until the last job they take – we will reach the goal I set two years ago: by the end of the decade, America will once again have the highest proportion of college graduates in the world.

One last point about education. Today, there are hundreds of thousands of students excelling in our schools who are not American citizens. Some are the children of undocumented workers, who had nothing to do with the actions of their parents. They grew up as Americans and pledge allegiance to our flag, and yet live every day with the threat of deportation. Others come here from abroad to study in our colleges and universities. But as soon as they obtain advanced degrees, we send them back home to compete against us. It makes no sense.

Starting this year, no American will be forbidden from serving the country they love because of who they love. And with that change, I call on all of our college campuses to open their doors to our military recruiters and the ROTC.

2012:

Jackie Bray is a single mom from North Carolina who was laid off from her job as a mechanic. Then Siemens opened a gas turbine factory in Charlotte, and formed a partnership with Central Piedmont Community College. The company helped the college design courses in laser and robotics training. It paid Jackie’s tuition, then hired her to help operate their plant.

I want every American looking for work to have the same opportunity as Jackie did. Join me in a national commitment to train 2 million Americans with skills that will lead directly to a job. My administration has already lined up more companies that want to help. Model partnerships between businesses like Siemens and community colleges in places like Charlotte, and Orlando, and Louisville are up and running. Now you need to give more community colleges the resources they need to become community career centers -– places that teach people skills that businesses are looking for right now, from data management to high-tech manufacturing.

When kids do graduate, the most daunting challenge can be the cost of college. At a time when Americans owe more in tuition debt than credit card debt, this Congress needs to stop the interest rates on student loans from doubling in July.

Extend the tuition tax credit we started that saves millions of middle-class families thousands of dollars, and give more young people the chance to earn their way through college by doubling the number of work-study jobs in the next five years.

Of course, it’s not enough for us to increase student aid. We can’t just keep subsidizing skyrocketing tuition; we’ll run out of money. States also need to do their part, by making higher education a higher priority in their budgets. And colleges and universities have to do their part by working to keep costs down.

Recently, I spoke with a group of college presidents who’ve done just that. Some schools redesign courses to help students finish more quickly. Some use better technology. The point is, it’s possible. So let me put colleges and universities on notice: If you can’t stop tuition from going up, the funding you get from taxpayers will go down. Higher education can’t be a luxury -– it is an economic imperative that every family in America should be able to afford.

Let’s also remember that hundreds of thousands of talented, hardworking students in this country face another challenge: the fact that they aren’t yet American citizens.


For Student Power will be covering the SOTU live, via Twitter and Facebook. Join in!

From Student Debt to Student Power

I recently sat down with The Daily Agenda to chat about student loan debt and how it relates to larger activist movements on- and off-campus.


Patrick St. John is a graphic designer by trade and student organizer by love. Patrick has been organizing and agitating since high school; as an undergraduate at Moravian College, he continued to agitate for student rights and power as both Editor-in-Chief of the student newspaper and later as student government president (where he advocated abolishing the position).

Like so many other young Americans, he left school thousands of dollars in debt. During his off hours Patrick is still organizing and writing a book on student power. He blogs at forstudentpower.org.

We interview Patrick about the state of student debt and the prospects of breathing new life into the student movement.

DA: As student debt has now climbed to over a trillion dollars, who exactly benefits from having so many students owing so much money?

Patrick St. John: It’s always important to ask that question, because it’s certainly not the students and it’s clearly not the faculty. However one winner is the administration, including the Board of Trustees. The size of university administrations have soared over the past 40 years, far outpacing the regular growth of faculty and support staff.

There has been an increasing emphasis on running the university like a business. As a result you get a ton of administrative overhead and you get administrators who are more interested in growing the bottom line than in education. Right now a lot of campuses, especially the higher profile universities, hire President’s that have no experience in the classroom. They come from business backgrounds, or sometimes from the military or politics.

Often times funding decisions are not based on the consideration of the students or even the professors, but either the university in its quest for prestige or the vanity of big donors. You see this dynamic where trustees and other wealthy donors make donations that go into physical projects like new buildings, new facilities, or new sports stadiums. You can’t bolt a plaque onto a scholarship; but you can bolt a plaque onto a building. In the University of California system, the Regents have made it quite clear that they prefer tuition dollars over state-issued dollars, because they have much freer range in their use — so we see on campuses across the state massive physical projects, either completed and unused, or frozen in mid-construction. It’s yet another predictable result of the people most affected by university decisions having the least amount of say in making those decisions.

You also predictably see an increase in official corruption, with Trustee boards often including the heads of the very businesses the college contracts with (usually banks and construction firms).

DA: Do you detect any sort of change in what is being taught in our universities because of the increased role of private corporations in higher education?

PSJ: It’s a funny kind of feedback loop. On one end, as parents and students see rising increasing tuition combined with a sluggish economy, you see an emphasis on the “career ready majors”: the majors that are guaranteed to get a good-paying job above all else. Students begin asking themselves, “why am I taking this literature class when I could be taking another economics class?” It has that sort of effect.

On the other end of the feedback loop, universities are trying to attract more — and wealthier — students by touting the fact that “if you go here, we’re sure that you will get a job after you graduate.” There is actually an interesting case where a woman who attended a for-profit school went through school and of course racked up a ton of debt. When she graduated she sued the school because the school had essentially promised, through their advertising materials, that she would get a job. Her lawsuit failed, but the point she made is here to stay.

DA: Student loan debt rates are set to double in 8 days if Congress (at the time of this interview. It now appears that Congress will freeze student loan rates for one year). How meaningful are the Democrats’ proposals to stop this from happening?

PSJ: It’s a smart political move for Obama because he might be able to re-energize many of his supporters on his left flank. But we all need to be clear: this is not a fight between progressive and conservative policy positions. This is a fight between conservative and very conservative policy positions.

The interest rate on student loans is already too high, even at the current rate. For comparison, it’s roughly 450% more than the rate the Fed loans money to banks. The President is trying to spin this so that he can attach it to his “usual hope and change” mantra, when in reality it’s just a holding position. It’s keeping the conservative status quo intact in the face of something even more conservative and more corporate.

But there is a lot that he could do. He could lobby and push to allow student loan debt to be dischargeable in bankruptcy court. This could actually energize lots of students and alumni, those who are most pro-Obama but least likely to vote. There are many Democratic Senators and Congresspeople who are more progressive than Obama on this. So it’s not like this is something out of nowhere. It doesn’t tackle the systemic problem of why higher education is so unaffordable, but consumer-side student debt reform would be a step in the right direction.

DA: Among the four demands put out by the Occupy Student Debt movement was “a one-time debt forgiveness, or “jubilee.” What would this entail?

PSJ: Wiping away all current student debt would be wonderful, and not just because I’m saddled with it myself. It’d be a huge boon for the economy, and it’s a much more helpful use of government funds than throwing trillions at banks. While it has a snowball’s chance in hell of happening, it’s still a useful demand to organize around, for two reasons. First, it engages students in a concrete way and encourages them to start thinking outside the box in terms of what is possible. Second, the act of pushing and agitating for a debt jubilee allows you to change the tone of the conversation. And it’s always a plus when you can tell conservatives that the thing you’re agitating for is right there in the Bible!

In America’s fragmented and decentralized system of higher ed, students may actually find more success tackling this issue at private colleges and state university networks. If you can establish, one way or another, a certain slice of the student population who can have their debt eliminated by the university, such as those with low-incomes, who do public service, and so on, that’s a foothold, or fulcrum, that can potentially be used to widen that slice until it encompasses all students.

But in terms of the big picture, if the person on the street or your local representative rejects the idea, you already have them talking about student debt. You can change the conversation, which is I think one of the lasting legacies of the Occupy movement: changing the political narrative not necessarily to get some 12-point plan through, but to create openings for individuals and groups to push for actual change.

DA: In an article that you wrote for ForStudentPower.org, you say that:“when electoral democracy is this broken, it's never that straightforward, and we are demobilized by thinking it is. We need to throw out the old playbook and pick up a new one (or two).”
What is the new playbook and what does it have to say about building a more vibrant democracy?

PSJ: Right. So if the framing of the problem is that the laws on the books are simply incorrect, by either mistake or malice, and that the solution is simply to correct the laws, then our paths of organizing are pretty limited. We have a sort of knee-jerk deference to people in power that often comes along with a very warped idea of how change comes about. Hopefully the protests in Québec right now will disabuse students of that deference. Québec tuition has been consistently among the lowest in the Western world for decades now, the only reason being that students and allies took to the streets in mass numbers and prevented every attempted increase, even minimal ones.

It’s also about changing the facts on the ground until elites catch up. If you look at the labor movement, workers didn’t wait until the Wagner Act in 1935 to actually start organizing unions. Everything from basic union recognition to the 8 hour work day, those were examples of Congress catching up with the facts on the ground. Huge swaths of the American workforce had fought for and won an 8 hour work day by the time Congress made it law. Many African-Americans didn’t wait until the Civil Rights Acts to eat at whichever lunch counter they wanted, or sit wherever they wanted on the bus. Through radical, direct action to change the facts on the ground, everyday people were able to spur sweeping historical changes.

All the wonderful things liberals like about the New Deal and Great Society got done by a Democratic President because he had immense pressure from his left flank in the form of more progressive Democrats, socialists, communists, and anarchists — with youth in the mix in all these groups.

Unfortunately, through the fog of history, a lot of liberals think that you do not need a far left to get liberal reform done. You absolutely do. Change doesn’t come about by voting for a specific person, change comes about when whoever happens to be in office is pressured by the people to do what’s right. Obama famously told bankers in a private meeting in 2009 that he was the only one standing between them and the pitchforks. Given the state of things, and the track record of both the banks and Obama in the years since, it seems clear to me that we need a hell of a lot more people with pitchforks.

For people wanting to get involved in this fight, one of the most exciting developments is the upcoming National Student Power Convergence this August in Ohio. Students and youth from across the country will be there, and it’s where we may get a glimpse of the future of student organizing.


Read the rest of the interview at The Daily Agenda! >

Obama's "Fighting for Scraps: Higher Ed Edition!" (Updated)

Obama and Arne DuncanAs anyone with an eye on the world of electoral politics has seen, because this is an election year we've been seeing "Candidate Obama" much more often. The Candidate Obama stage is about the only time the Democrats' liberal base gets a few bones thrown to it (it's a shame he wasn't up for re-election in 2010 - we might have gotten a halfway decent healthcare bill). 

In a bid to re-energize the university student vote, President Obama made quite a few pledges and proposals around higher ed in his State of the Union Address. The crux

Join me in a national commitment to train two million Americans with skills that will lead directly to a job. My Administration has already lined up more companies that want to help. Model partnerships between businesses like Siemens and community colleges in places like Charlotte, Orlando, and Louisville are up and running. Now you need to give more community colleges the resources they need to become community career centers – places that teach people skills that local businesses are looking for right now, from data management to high-tech manufacturing. [...]

When kids do graduate, the most daunting challenge can be the cost of college. At a time when Americans owe more in tuition debt than credit card debt, this Congress needs to stop the interest rates on student loans from doubling in July. Extend the tuition tax credit we started that saves middle-class families thousands of dollars. And give more young people the chance to earn their way through college by doubling the number of work-study jobs in the next five years.

Of course, it's not enough for us to increase student aid. We can't just keep subsidizing skyrocketing tuition; we'll run out of money. States also need to do their part, by making higher education a higher priority in their budgets. And colleges and universities have to do their part by working to keep costs down. Recently, I spoke with a group of college presidents who've done just that. Some schools re-design courses to help students finish more quickly. Some use better technology. The point is, it's possible. So let me put colleges and universities on notice: If you can't stop tuition from going up, the funding you get from taxpayers will go down. Higher education can't be a luxury – it's an economic imperative that every family in America should be able to afford.

A few thoughts.

LSE is Occupied! An Interview

2010 LSE Occupation

On December 2nd, students at the London School of Economics and Political Science occupied the Old Building on campus, demanding the Administration take a stand against the looming education cuts coming from Parliament. I chatted with occupying LSE students Isla Woodcock ('11), Emma Kelly ('12), and Alice Stott ('13).

FSP: So first off, what's the overall mood in the building right now? What are folks doing?

LSE: Very positive. The events team are drawing up a schedule for the week, others are drafting our statement.We're all ecstatic about getting official union backing this afternoon after a vote!

FSP: Yes, I read that! How much organizing for the occupation itself was done under the auspices of the student union? Or was it more of an independent grouping of student activists?

Washington Monthly and Alternet Applauding the Walmart-ization of Higher Ed?

Education Sector and the Wal-mart-ization of Higher Ed

The Washington Monthly (reposted by Alternet????) has a lengthy, horrendous article about the future of higher education, alternating between being a fluff piece for a cheap online course company (StraighterLine) and being an apocalypse piece on the supposed doom of most colleges and universities. It's a long essay, but it's an important read - if only to get a sense of what the beltway non-profit establishment thinks about higher ed.

It's hilariously chock-full of baseless economistic assumptions, profound misunderstandings of universities, and attacks on professors. Let's see:

And while she had a professor, he wasn’t doing much teaching. “He just stands there,” Solvig’s daughter said, while students worked through modules on their own.

- Trashing all of introductory course teaching through use of a single anecdote? Check.

Given the choice between paying many thousands of dollars to a traditional university for the lecture and paying a few hundred to a company like StraighterLine for a service that is more convenient and responsive to their needs, a lot of students are likely to opt for the latter—and the university will have thousands of dollars less to pay for libraries, basketball teams, classical Chinese poetry experts, and everything else.

- Implying that the high cost of higher ed has more to do with "classical Chinese poetry experts" than the explosion of exorbitantly-paid administrators and consultants, or the shrinking share of state financial support? Check. (See Marc Bousquet's work for the real reason for the tuition explosion.)

One of StraighterLine’s original partner colleges was Fort Hays State University, just off I-70 in Hays, Kansas.[...] By early 2009 a Facebook group called “FHSU students against Straighter Line” had sprung up, attracting more than 150 members. [...] The English Department announced its displeasure while a well-known academics’ blog warned of the encroaching “media-software–publishing–E-learning-complex.” Gould was denounced in the Fort Hays student newspaper.
[...]
When I spoke with Smith again in June, the whole experience had left him frustrated. “A couple of posts from grad students who’ve never even seen or taken one of the courses pop up on Facebook,” he said, “and North Central [the accreditor] launches an investigation. Meanwhile, there are horror stories about bad teaching at regular universities on RateMyProfessors.com”—a popular student feedback site—“and they don’t give it a second look.”

- Casting students and professors who are concerned about their job security and academic freedom as backward-thinkers bullying a poor, unfortunate venture capitalist? Check.

Smith could offer introductory college courses à la carte, at a price that seemed to be missing a digit or two, or three: $99 per month, by subscription. Economics tells us that prices fall to marginal cost in the long run. [...] Which means the day is coming—sooner than many people think—when a great deal of money is going to abruptly melt out of the higher education system, just as it has in scores of other industries that traffic in information that is now far cheaper and more easily accessible than it has ever been before. [...] There is an unstable, treacherous future ahead for institutions that have been comfortable for a long time. Like it or not, that’s the higher education world to come.

- Using groundless economic assumptions to proclaim the inevitable triumph of for-profit edu-farms over universities? Check.

While the article ends on a wistful note about the social good of having the liberal arts university, it's by way of backhanded praise of "quirky small university presses" and "Mughal textile historians," implying that there's a division between Very Serious Studies™ (like business, economics, hard sciences, and trade school subjects) and useless-but-quaint studies (everything else).

Follow the Money

It's important to see exactly from whence the author, Kevin Carey, is coming. Carey is the policy director at Education Sector, an inside-the-beltway think tank. Check out where it gets its money: free-marketeers like The Gates Foundation, CityBridge Foundation, KnowledgeWorks Foundation, and the Rodel Foundation. Education Sector pushes hard for charter schools, rigid performance testing of teachers (with an extra middle finger to teacher unions usually tacked on), standardized testing of students, and the implementation of other market-oriented "reforms" in both K-12 and higher education.

A Better Alternative?

Education Sector isn't the only, and certainly not the first, to endorse the Walmart-ization of higher ed. Back in April we covered Brigham Young professor David Wiley, who is pushing very similar "reform" Kool-Aid.

The funny thing is that it's the introduction of corporate models and thinking into the university that's fueled both the spiraling tuition cost and the perma-temping of faculty (which can result in lackluster 101 courses). Coincidentally enough, that's the same culprit when it comes to newspapers going under, which Carey uses for comparison.

The solution offered by StraighterLine and its ilk seems to be "look at these caricatured subpar offerings of universities: we can give you the same crappy quality, but cheaper!" The actual solution isn't to package online quizzes as "curriculum," but to democratize the university - put it back in the hands of students and faculty. The few truly idiotic expenditures that Carey correctly points out ("vainglorious building projects, money-sucking sports programs") would likely never happen if those at the reins of the university were its actual constituents, instead of being run and overseen by the very class of Wall Street denizens from which Carey eagerly awaits salvation.

Update: I forgot to mention this delightful tidbit:

Ivy League and other elite institutions will be relatively unaffected, because they’re selling a product that’s always scarce and never cheap: prestige. Small liberal arts colleges will also endure, because the traditional model—teachers and students learning together in a four-year idyll—is still the best, and some people will always be willing and able to pay for it.

That's right! The rich kids will get to keep their decent educations - reallycheapdiplomas.com will more than suffice for working class kids, right?

NYU - The LATEST - 1:31AM

The tension inside the occupied NYU building has spilled out onto the streets in the form of literal street combat - cops have rolled in en masse at around 1:15AM (the deadline NYU Admin set for everyone to leave was 1AM). It's now 1:30AM, so far there's only been one arrest (of a student trying to climb a streetsign) - but apparently there's been copious amounts of teargas used. The street and intersection are so full of people, the cop cars can't get anywhere close.

35 More Students Join NYU Occupation Despite Police Violence - Midnight RALLY planned!

The Occupation of NYU for a more affordable, democratic, and socially responsible university has been going on for nearly 24 hours.

The administration of NYU still refuses to negotiate with the students of Take Back NYU! and has made multiple threats to students, including calling parents to threaten expulsion and promising arrests at 1 am in the morning.

I just got word from Drew SDSer Christa H. that about 35 students just rushed inside to join the Occupation. According to Christa, the police assaulted students Occupying the Kimmel Center and those making their way inside. She said that they hit many students and ripped shirts off of others. She ended the conversation by saying she had to go help others block the doors. According to Alex Lotorto, a member of Muhlenberg SDS, there are nearly 75 students inside the occupation at the moment!

Students have been making their way to NYU from across the city and from as far away as DC to support the amazing work that Take Back NYU! has done in the two years of their campaign leading up to this occupation. Support is still needed, anyone who can make it to NYU should head their immediately as support from the street is greatly needed.

Take Back NYU! is planning to hold a midnight Rally, which will take place right before the administration promised to give the order to arrest.

If you’re not close enough to travel you can still support the cause by letting everyone know about this bold action that NYU students are taking and by calling the NYU administration to demand that they NEGOTIATE with students rather than THREATEN AND BEAT them.

Support Take Back NYU!

Sign the Petition

cross-posted at Building Our Power

"We're not giving them shit!" NYU Negotiations are STARTING

NYU Administration has agreed to begin negotiations with the occupying students. They originally wanted some kind of concession from the students in exchange for negotiations. In the words of Farah, who was at the megaphone, "We're not giving them shit! We are strong and we are united!"

If that's what negotiations have in store, then the students should be in for a productive night.

CLICK HERE for a live streaming video from the occupation.

NYU Administration refuses to negotiate, threatens expulsion

This is Jasper Conner's first post on For Student Power - thanks for writing, Jasper! - Patrick 

NYU Refuses to Negotiate with Student Occupation!
SUPPORT NYU OCCUPATION!
 


NYU’s administration refuses any face-to-face contact with student occupation, drawing out Take Back NYU!’s occupation, currently making national news.

 

The occupation, which began at 10pm on Feb. 18th with the seizure of the 3rd floor of the Kimmel Center has made news across the country and received declarations of support from universities across the world.

NYU’s Administration refuses to allow the students of the occupation a place at negotiations, instead relying on threats and intransigence to try to end Take Back NYU!’s campaign.

The NYU administration has threatened students with arrest late tonight, they need your support NOW! Click the link below and after you call and e-mail the administration, send the link to your friends!

SUPPORT NYU OCCUPATION!
You can also sign the online petition!

 Below is a recent press release from Take Back NYU! detailing the administration’s refusal to negotiate and their intention to maintain the Occupation.

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