Today, around kitchen tables across the country, high school students and their families are discussing options for college. While the opportunity to obtain a higher education brings much pride and hope, it also creates financial stress - how to pay the bills? The costs are causing families to choose between draining retirement accounts, taking home equity loans, or saddling their children with tens of thousands of dollars of debt.
I can imagine the conversation, as one of five children in a family who made sacrifices to pay 20 years of tuition bills, and as a parent of three children who attended college when costs were ten times higher.
According to The College Board, tuition and fees at private non-profit colleges increased by 11% over the past five years; at public institutions it was a 13% jump.
All options must be on the table to provide relief -- from holding the line on interest rates and protecting Pell Grants, to allowing graduates to refinance their debt and establishing income-based repayment programs. I also support free community college for those who are unable to afford it.
In addition to the sticker shock, however, families want to be confident that they are making the right investment. This is often the most important and expensive decision they will ever make. They deserve to know which college, which program, and at which price is the best choice. Congress can do more to make such information available.
Annually the federal government is providing over $130 billion to public and private institutions through financial aid, in addition to billions in tax credits, but is not leveraging those dollars to expose outcomes and control costs. We need to demand more transparency from schools so families can anticipate the return on investment. Families deserve more consistent release of quality consumer information on employment and earnings outcomes in order to compare how different colleges and programs are serving students.
President Obama's recent push to make college financing decisions more transparent and cut off federal student loan funding to organizations whose graduates routinely are left with too much debt relative to income is a step in the right direction.
Without a doubt, college is worth it. Overall, most graduates still out-earn people without degrees. A higher education increases the chance for higher wages even if that isn't realized in the first year after completion.
But students and families deserve to know what they are buying. While we want our children to flourish, work hard to develop their intellectual rigor, and explore ways to make a difference in the world, most importantly we want them to have a good job. Wouldn't it be nice if before choosing a school you knew how likely it was that she or he would get one?
We are fortunate to have the world's best higher education system, and right here in Maryland we enjoy world-class research and liberal arts colleges and universities. Yet, this doesn't help our students if a college degree requires assuming tens of thousands of dollars of crippling debt. And the value of that debt is meaningless if they can only get a minimum wage job.
Right now families are weighing options for schools and crunching the numbers. Surrounded by flattering acceptance letters, shiny brochures and lofty promises, they need more leverage. We can do more to help students be empowered consumers, allowing them to be more financially stable and giving them an opportunity to succeed. This is not only the right thing to do, it is the right step for a country committed to empowering the next generation in a competitive global economy.