Several Democratic presidential candidates promote the idea of “free” public higher education and advocate for the elimination of student debt. Neither idea as presented to date would accomplish progressive goals to increase college access and affordability.
Public college and university education is subsidized substantially and the average family income of those attending such institutions is above the state and federal average. For example, in New York State, the average family income is about $65,000 while the average income of families with students on SUNY’s four-year campuses is more than $100,000.
The academic profile of SUNY students reflects the relative affluence of their families. Lower tuition, together with increasing use of merit rather than need-based aid, to attract students with certain desired attributes such as high SAT scores, results in even more selective admissions competition. As a result, SUNY has a higher academic profile and provides financial benefits to those who need it less than the majority of families. SUNY, like other state university systems, is replacing students from lower income families with those from more affluent homes.
Those who push for free college should know the data before advocating policies that would continue to benefit those who need it least. Free tuition for community college students, whether full time or part time? Yes! But that is not what we hear.
Some candidates also recommend wiping out student debt, claiming it is a drain on the economy and a hindrance to college graduates’ plans. I agree that student debt is a problem, but not one to be fixed by waiving the debt obligations of those who hold it.
Most debt is taken voluntarily because a family or student wants a particular institution for its “brand.” There is no reason for a student to graduate with $100,000 in debt for a bachelor’s degree, yet this is a number cited in news media. In fact, the average debt for a bachelor’s degree recipient in New York State in $32,000 at private colleges and universities, and over $28,000 at public institutions. Overall, the highest average debt is held by students from families in the top 10th percentile of family income while the lowest average debt is held by students from the lowest quartile of income (under $27,000).
A high proportion of student debt is held by those who attended for-profit colleges. While these schools enroll about 6 percent of New York college students, they account for 17 percent of borrowers and 41 percent of those who defaulted after five years. These students are more likely than students at other institutions to take out loans and their average debt is higher, their graduation rate is lower, and their loan default rate is the highest. The people should not bail out these students; the businesses that lured and profited from them should pay.
Traditional colleges and universities should bear some responsibility for low graduation rates that, overall, are dismal. The average graduation rate for public institutions is 59 percent and for private institutions is 66 percent — after six years! Colleges must do more to foster student success.
In addition, the federal government should have lowered the interest rate when commercial rates declined, something it did not do until recently. Also, when the federal government overhauled the Guaranteed Loan Program in 2010, it wrongly allowed for so-called “alternative” private loans that charged up to 16 percent interest. Finally, unlike credit card and car loans, federal student loans cannot be discharged through bankruptcy. This, too, can be amended.
I applaud those who want to make college more affordable and reduce student debt. But these efforts should be targeted to help those who need it most.
Robert A. Scott is president emeritus of Adelphi University.