With college tuition costs at an all-time high, Demos, a D.C.-based public policy organization, recently proposed a debt-free college initiative. "The Affordable College Compact" calls for state and federal partnership in higher education with the goals of substantially increasing public investment in higher education and reducing student debt.
In the current job market, a college degree continues to have tremendous value. As the New York Times noted in 2014, college graduates make 98 percent more per hour than people without a degree, and not obtaining a college degree costs about half a million dollars. Demos notes that "nearly two-thirds of all new jobs in the next 6 years will require some training beyond high school, and 35 percent will require at least a bachelor's degree."
Despite its value, the cost of a public college education has risen as state and federal investment in education has declined. Inflation-adjusted tuition and fees have increased 117 percent at public four-year institutions and 62 percent at two-year schools over the last two decades. Meanwhile, the average debt accumulated by students at public schools has increased by almost a third over the past decade. Not surprisingly, the debt load is heaviest for first-generation students, low- and middle-income students and students of color.
Demos intimates the consequences of college becoming less affordable are disastrous. The United States is only 12th in the world for college attainment among 25-34 year olds (we are first for those over 65). The gap in college graduation rates by race and class are widening. Student debt is an increasing drag on the economy as it reduces household formation and homeownership. The risks of delinquency and default are high for those who graduate with degrees, and even higher for the 29 percent of borrowers who drop out.
In response to this crisis, the Affordable College Compact proposes the federal government leverage funds to ensure that poor, working class and middle-class students can attend college debt-free. States would be required to treat higher education as a public good (which Demos defines as ensuring that tuition revenue does not exceed revenue appropriated) and in return would be eligible for 20 percent or 60 percent matching federal grants for every dollar they spent on higher education, depending on their level of commitment. States increasing their commitment over time would be eligible for an additional 40 percent match.
Demos' estimate is that the Affordable College Compact would cost $29.5 billion if all 26 currently eligible states (those who meet the public good requirement) participated at their current funding levels and increased funding by 1.4 percent. Of course, these initial estimates would rise as more states and students respond to federal incentives, and it remains uncertain whether states, which are still recovering from the Great Recession, are prepared to shoulder these costs. However, this budget is still less than the federal government invests in Pell Grants, less than it invests in tax-based student aid and far less than the Department of Defense's budget of $496 billion.
Debt-free education is not as radical as it might seem. Countries like Germany, Denmark, England, and Australia have all deemed education worthy of investment at approximately these levels. Whether we conceive of it as a public good or not, Americans need to consider making a similar investment. Kudos to Demos for sketching out one way to accomplish it.
Isaac Bowers is Associate Director for Law School Engagement & Advocacy, overseeing the Student Debt, Student Engagement and Law School Relations programs. He was previously responsible for the organization's educational debt relief initiatives. In that capacity, he wrote a weekly blog for U.S. News; conducted monthly webinars for a wide range of audiences; advised employers, law schools and professional organizations; and worked with Congress and the Department of Education on Federal legislation and regulations. Prior to joining Equal Justice Works, he was a Fellow at Shute, Mihaly & Weinberger LLP in San Francisco, where he represented citizen groups and local agencies in environmental litigation and land use and planning issues. Isaac received his J.D. from New York University School of Law.
Lauren Hunter is a Communications Consultant for Equal Justice Works, and a full-time Ph.D. student in the Department of Communication at the University of Maryland. She studies rhetoric and public address with a focus on rights and public policy.