Clinton’s costly college plan deserves a failing grade
When not bashing Donald Trump, Hillary Clinton’s team has been trying to mend fences this week with Bernie Sanders’ backers. Team Clinton played up the progressive record of Clinton running-mate Tim Kaine and helped usher out Rep. Debbie Wasserman Schultz as Democratic Party chairwoman.
But the real effort to make nice with the Sanders camp has been taking place over recent weeks as Clinton has adopted many of his policies, particularly on trade, energy and education. Nowhere is that clearer than in her plan to help people pay for college.
Clinton started her campaign with an already costly proposal to spend $350 billion over 10 years. With encouragement from Sanders, she recently revised her plan to add at least $100 billion, and probably much more. The party platform, approved Monday at the convention in Philadelphia, reflects her call for tuition-free college for working families and debt-relief for students.
Clinton now would allow anyone coming from a family making $125,000 a year or less the chance to a attend public university tuition-free. The student and the family would be called on to help defray some of the other costs associated with attending college, but these contributions would not be so much that they would require borrowing.
She would also allow any student or graduate to refinance existing debt into lower interest rates or programs that allow people to repay debt as a portion of their salary. The college plan, and other new spending programs, would be financed with an array of new taxes on the wealthy.
All this might sound good, particularly to the Millennials who overwhelmingly backed Sanders in the Democratic primaries. But the plan is not particularly fair to people who’ve already sacrificed mightily to pay for higher education. Nor does it address the main drivers of rising tuition: an indulgence of instructors who don’t spend much time in the class- rooms, money-losing sports programs, bloated bureaucracies and massive building campaigns.
Government grants and subsidies to students and universities already amount to more than $150 billion a year. Additionally, students pay about $120 billion annually with borrowed funds, almost all of it through federal programs. This flood of money has not held tuition down. In fact, it has had the opposite effect.
A study by the Federal Reserve Bank of New York last year found that for every dollar in Pell Grants colleges received, they hiked tuition by 55 cents, and for every dollar in subsidized federal loans, they hiked tuition by 65 cents. Clinton argues that her new plan would hold universities accountable. But she provides few details, and what details she does include do not include restrictions on tuition hikes.
Politicians already have leverage to force universities to hold the line on costs. They could make Pell Grants, Stafford loans and other aid conditional on freezing or cutting tuition. Only then should they consider pouring more money into higher education. That approach would finally break the cycle of ever increasing college costs. It would also show that Clinton is interested in solving a real-world problem, not just trying to entice Sanders voters with free stuff.