The debt collection industry is benefiting from the large numbers of people in default on their student loans, The New York Times reported. In the last fiscal year, the U.S. Education Department paid collection agencies more than $1.4 billion to try to collect debts. Critics argue that the government should be doing more to help borrowers avoid default, rather than focusing on collecting the debts. The article opens with a column from a collection industry trade publication in which the author describes attending a rally at New York University at which students angry about debt wore T-shirts with their large, personal debt totals on them -- $95,000, $60,000 and so forth. "As I wandered around the crowd of NYU students at their rally protesting student debt at the end of February, I couldn’t believe the accumulated wealth they represented – for our industry," the columnist wrote. "It was lip-smacking."
Higher Education Quick Takes
A new ranking of colleges -- the Alumni Factor -- will debut today. As the name suggests, most of the criteria are based on alumni views of their own colleges. Only 2 of the 15 criteria do not come from alumni surveys. Four of the criteria are related to wealth: average household income, percentage of graduates in high-income households (above $150,000), average net worth of households, and percentage of graduates in high net worth households (above $1 million). Other criteria -- such as preparation for job success and immediate job opportunities -- focus on careers generally, not pay. The new ranking effort is led by Monica McGurk, formerly of McKinsey and Company. In an interview, McGurk said that her company has figured out a reliable way to get representative samples of alumni to survey and that these names are not provided by their alma maters. She said that typically about 200 alumni are needed per college, and that they are evenly distributed in age, but that people are not surveyed until they are at least two years out of college. She declined to say how the company identifies the alumni.
Asked if her system favors colleges that educate investment bankers over, say, teachers, given the wealth-based criteria, McGurk said that it did not. She noted that other criteria in her methodology, such as friendship development at college, and social and communication skill development, have nothing to do with salaries or wealth. And she said some colleges that have over the years educated many teachers (she named Spelman College as an example) did quite well in her rankings. While the criteria are ranked equally in the Alumni Factor methodology, the company will offer a tool for prospective students to set their own methodology in the rankings, so they can count factors they care about, and not others.
The Alumni Factor plans to make money by offering low-cost access to its rankings, with the idea that students and families will want to see them, and that some alumni may as well. The company also plans to sell its data to colleges that may be able to compare themselves to peers, having access to aggregate data. McGurk declined to say how much the company would be charging colleges.
Stanford University researchers are using MRI images to study the brain patterns of literary Ph.D. candidates while they read Jane Austen. The early results suggest a very high level of brain activity prompted by close reading of the novelist.
As more colleges -- public and private -- are coming to rely on community college transfers, four-year institutions are doing more to welcome them, The Los Angeles Times reported. Four-year institutions are creating special orientation programs for transfers, setting aside space in campus housing, creating clubs and offering scholarships.
A Towson University student who sparked debate last year by founding a chapter of Youth for Western Civilization is now trying to create a White Student Union, The Baltimore Sun reported. The group he created last year has fallen apart after losing its faculty adviser. L. Victor Collins, assistant vice president of student affairs for diversity, said the proposed group would be evaluated like all others, based on non-political criteria. While Collins said he supported the group's First Amendment rights, he questioned the need for a white organization. "They think they are a parallel comparison to the Black Student Union," he said. "In my observation in American society and history, I don't know if white students have been discriminated against or denied access to institutions. This is a predominantly white institution. I don't understand why they have to [form a group]."
Campaigns by the National Collegiate Athletic Association and Native American groups have led most universities that had Native American team names to eliminate them. But Eastern Michigan University, one of those universities, is bringing back (in part) use of the Hurons logo that was replaced with Eagles in 1991, The Detroit News reported. The marching band will now have uniforms that include the Eagles, the Hurons and the Normalites (the original logo). Officials say that they are not violating the NCAA ban (because of an exemption for historical uses of old names) and that the use of all three mascots on the uniform will unite alumni from different eras. Some alumni who remain loyal to the Hurons name are cheering the shift. But Fay Givens, director of American Indian services, said, "I don't like native people being used as mascots in any situation."
Representative Roscoe Bartlett, a Maryland Republican running for re-election, said in a recent town hall meeting that student loans -- while potentially doing good -- may be unconstitutional, The Washington Post reported. Bartlett said that he had searched the U.S. Constitution and found no justification for a federal role in education, including student loans. "Not that it’s not a good idea to give students loans, it certainly is a good idea to give them loans,” Bartlett said. “But if you can ignore the Constitution to do something good today, tomorrow you will be ignoring the Constitution to do something bad. You could. There are more people in our, in America today of German ancestry than any other [inaudible]. The Holocaust that occurred in Germany — how in the heck could that happen? And when you start down the wrong road, it can be a very slippery slope."
Asked about the statement on Thursday, a spokesman for Bartlett said that he "is also a strong supporter of making college accessible to all Americans, and unlike most politicians he has put his money where his mouth is by donating a substantial portion of his salary to help underprivileged students attend college.”
A study from the MetLife Mature Institute found that 29 percent of grandparents have given their grandchildren financial support for education, spending an average of $8,276 over five years. Of those grandparents who did fund their grandchildren’s education, 32 percent helped with tuition or loan payments, 29 percent donated to a college savings plan, and 7 percent helped pay for graduate school.
“It seems to be a change from earlier generations where we all graduated from college and pretty much felt we were on our own,” said Sandra Timmermann, a gerontologist and the director of the MetLife Mature Market Institute. Timmermann noted that whereas people used to be concerned about leaving money for their children and grandchildren in their wills, there is now more of a tendency for that money to be given earlier.
When MetLife conducted a similar survey in 2009, it found that 26 percent of all grandparents helped pay for their grandchildren’s education, but of those, the largest proportion, 46 percent, put their money in a college fund. The 2009 survey, however, was administered only to grandparents with grandchildren 25 or younger, while the 2012 iteration surveyed all grandparents.
CHARLOTTE, N.C. — In a speech accepting his nomination for re-election Thursday night, President Obama laid out an ambitious higher education goal for his second term: he said he’d “work with colleges and universities” to slow the rise in college tuition by half over the next decade -- but gave no details on how he would accomplish that. It was the first discussion at the Democratic National Convention of what education policy might look like in a second Obama term.
During the State of the Union speech in January, Obama proposed expanding campus-based financial aid programs -- such as the Supplemental Educational Opportunity Grant and the Perkins Loan -- and using the extra money to reward colleges that keep tuition low or provide “good value” (and punish those that do not).
Early attempts by the Education Department to implement parts of that plan, such as a new competitive grant program for higher education, went nowhere in the Senate in next year’s budget negotiations. But Thursday night’s speech appeared to signal that the president, if re-elected, intends to keep pushing colleges to keep tuition prices low -- or at least slow their growth.
How Obama would do that, let alone whether he would succeed, is unclear. The past two decades have seen several federal attempts to pressure colleges to lower tuition, most recently in 2003, when Republicans in Congress proposed cutting off federal aid to colleges whose price increases outstripped inflation. Colleges greeted the proposal with howls of protest, and the measure never got beyond the education committee.