If President Obama really wants to “shake up” higher education, he should start by scaling back student loans, writes economist Richard Vedder on Washington Monthly‘s College Guide. That means dropping loans to affluent parents and the federal tuition tax credit, limiting student borrowing and, ultimately, getting the federal government out of the student-loan business.
Colleges that benefit from student loans and grants should share some costs of high default rates, Vedder argues. That would discourage colleges from enrolling students with little chance of success. (Politically, this is a big loser.)
Next, consumers need better information, he writes.
Lots of students enter college based on bad advice, often from guidance counselors and school marketing efforts. Politicians make things worse with a “college for all” mantra, implying life will be a failure without a college degree to provide the ticket to the moderately affluent middle class.
To counteract the propaganda, a bill proposed by U.S. Senators Ron Wyden, an Oregon Democrat, and Marco Rubio, the Florida Republican, would mandate the disclosure of information regarding post-graduation earnings of students by college and major. Polls show that college students’ single biggest goal is achieving financial success.
Colleges are expensive screening devices, writes Vedder. There should be other ways to demonstrate potential workplace competence.”Why doesn’t someone (College Board? Educational Testing Service? Google Inc.?) develop a national college equivalency examination that tests for the critical learning skills, literacy and basic knowledge that all college graduates are expected to have?”
A credible exam would reduce the worry about low-quality online courses and make it easier for students to assemble courses from multiple providers.
Finally, Vedder calls for eliminating barriers to entry to higher education.
The single largest obstacle is the dysfunctional accrediting system, which is rife with conflicts of interest and gives consumers little information. . . . Arguably, we should eliminate accreditation as such, with the government simply defunding programs that fail to meet minimum standards (such as institutions with student-loan-default rates greater than graduation rates).
Lowering the demand for college slots and increasing the supply of higher ed providers would bring costs down.