New Hampshire is the state with the highest average student debt in the country and Hillary Clinton will be there today (August 10, 2015) to announce her $350 billion plan aimed at making college more affordable and reducing the crushing burden of student debt. It’s being reported that her proposal centers on a $200 billion federal incentive system aimed at encouraging states to expand their investments in higher education and cut student costs. States who want to partake of the $200 billion in federal funds will have to guarantee “no-loan” tuition at four-year public schools and free tuition at community colleges.
To contrast: In May, Vermont Senator and Democratic presidential candidate, Bernie Sanders, released his own plan that would eliminate tuition and fees for public universities. The “College for All Act” would have the federal government pay for two-thirds of the cost of public college tuition, and ask states to pick up the tab for the remaining third and his plan would be fully paid for by Imposing a Robin Hood Tax on Wall Street.
To qualify for federal funding, states must meet a number of requirements designed to protect students, ensure quality, and reduce ballooning costs. States will need to maintain spending on their higher education systems, on academic instruction, and on need-based financial aid. In addition, colleges and universities must reduce their reliance on low-paid adjunct faculty. States would be able to use funding to increase academic opportunities for students, hire new faculty, and provide professional development opportunities for professors. No funding under this program may be used to fund administrator salaries, merit-based financial aid, or the construction of non-academic buildings like stadiums and student centers
Does Hilary’s “no-loan” guarantee mean that the students still borrow the money to pay for their education but will have not pay any interest on the money borrowed? If so, her plan seems only a “half is better than none” plan. The problem is not just the high interest students are paying on their loans it’s also about the high dollar tuition they’re paying the interest on, as well as how universities are spending the money.
According to Gordon Wadsworth, author of The College Trap, “…if the cost of college tuition was $10,000 in 1986, it would now cost the same student over $59,800. The increased tuition is not going in the pocket of professors. Salaries of full-time faculty members are, on average, barely higher than they were in 1970. Additionally, universities now hire lower-paid part-time facility. Which means that the average salaries of the people who do the teaching in American higher education are actually lower than in 1970.
So, where’s the money going? Higher education has become big business and like all big businesses the money flows to the top. According to Department of Education data, administrative positions at colleges and universities grew by 60 percent between 1993 and 2009, which Bloomberg reported was 10 times the rate of growth of tenured faculty positions.
When you compare these two plans it seems that Bernie Sanders has a much better handle on entire money crisis in Higher education. Throwing dollars at a problem without saying where those dollars will come form or controlling how they will be spent seems rather short sighted.