The Honorable Barack Obama
1600 Pennsylvania Avenue
Washington, D.C. 20500
Dear Mr President:
I hereby enter these words into the public debate for your second term. Whatever you say later today in your own Second Inaugural, you have my word that I will be loud and relentless with these words during your second term: Abolition. Emancipation.
Why? By my count, our country has more Americans enslaved in your presidency than the 4 million slaves counted in the 1860 U.S. Census. I am looking at the 9.4 million students on Pell Grants, with little hope of an education even close in quality to yours at Columbia and Harvard or mine at Williams and Yale.
My outrageous analogy follows the federal math no one has any plans to change. This nation first counted slaves as three-fifths of a person. That’s 60 percent. The maximum Pell Grant for these students is $5,500, while the federal subsidies to all undergraduates at your Columbia and my Williams are often five times that – two-fifths. In federal tax benefits alone, Mr. President, every undergraduate at Columbia and Williams receives benefits ranging from $15,000 to $35,000 depending on your assumptions. For here I’ll pick $25,000 and call it two-fifths.
As the start of my “relentless” campaign I repeat: No one has any plans to change this situation in the most basic need for a just society: education. No one has any plans, even though everyone in the chambers and offices behind you this morning knows the outcome for these people and for the nation of this plan.
As the arc of the moral universe bends toward justice, the chains are gone. Enslavement remains, as death by poverty. You and I both know that these students, working 30 hours a week and more in unsteady jobs and raising families, have little hope of graduating.
What’s my evidence for the outcome? I don’t know what you were doing last Monday. I spent from 10 a.m. to 1 p.m. setting up and volunteering at a food bank at Bunker Hill Community College, a place filled with these Pell Grant students. Mr. President, these students have little to eat. These students are on food stamps. Our Massachusetts governor, who knows better, was on the campus for a MOOC press conference with Harvard and MIT on the day of our December food bank. He wouldn’t visit the food bank. You and I both know, Mr. President, that failing to look at hunger will not eliminate the hunger.
Amid the Oscar din for "Lincoln," let’s admit that the 13th Amendment has failed. I refer to the Constitutional prohibition of “involuntary servitude” and the legal provisions today that exempt student loans from bankruptcy laws.
Preposterous? Not at all in the 21st century. Why is the wealthiest county on Earth allowing powerful corporations to scam teenagers and others who, remember, don’t have a college education yet, into such financial shackles?
Let’s look at Section 1. “Nether slavery nor involuntary servitude, except as a punishment for crime whereof the party shall have been duly convicted, shall exist within the United States, or any place subject to their jurisdiction.
You’re a lawyer, Mr. President. Declare the student-loan bankruptcy trap unconstitutional. Of course informed citizens have a responsibility to repay loans. The bankers who made these loans and the college CFOs who cashed the checks are the one to answer for these bad debts, not the entrapped students. President Lincoln didn’t know if the Emancipation Proclamation would stick. You may just win on this one.
Are my arguments here preposterous? Outrageous? How I wish they were, Mr. President. How I wish they were. I think you realize, Mr. President, that things for millions in the U.S. today are this bad for millions. I’m a sometime teacher, sir, and one of the nation’s leading obscure columnists. I can only proclaim, not issue proclamations.
With words – abolition, emancipation, enslavement – I sometimes can make people stop and think. That the 9.4 million students on Pell Grants, most of whom may have little to eat today, live in a building rather than a shanty in Nairobi’s Kibera makes no one a hero.
Are my arguments preposterous? May I send you a copy of The New Jim Crow, Mass Incarceration in the Age of Colorblindness by Michelle Alexander? We, the people, are failing on the 13th Amendment. This book is about the massive prison population in the U.S. That’s a group intertwined with poor college students at food banks. As Alexander writes, “We have not ended racial caste in America; we have merely redesigned it.”
Mr. President, the Department of Justice is considering how private colleges can meet together to discuss, without violating antitrust laws, what the colleges believe are constraints in awarding need-based aid. Listen to Alexander: “What has changed since the collapse of Jim Crow has less to do with the basic structure of our society than with the language we use to justify it.” Mr. President, would you wake up Attorney General Holder?
“Need-based aid” is just the new Jim Crow language trick. “Need-based aid” means giving money to blacks, other minorities, and the poor in general. Absence of financial aid is among the final barriers to college. Have you seen The Central Park Five? About the fate of the five young men falsely convicted of rape in New York?
I have an idea for you: Lead the next March on Washington. Why can’t the President lead the march? Tactics so far have done little to move Congress.
As you look down the Mall today toward the Lincoln Memorial, imagine crowds even bigger than at your first inauguration -- students in a march on Washington led by you. Pick a day for the march when Congress is in session. In your inspiring way, ask the students to turn around, toward the Capitol. Ask them to march on Congress to demand that every student be entitled receive the same federal aid for college. If the Pell Grant has to stay at $5,500, so be it. No more federal subsidies via tax deductions for skyboxes, indoor golf nets or new buildings. (Click here for why.)
Have the marchers demand from Congress that federal law includes student loans in federal bankruptcy protection. Add on that students on Pell Grants receive federal free and reduced lunch, too, for the duration of your second term?
Abolition. Emancipation. Mr. President, that’s the job of your second term.
Wick Sloane writes the Devil's Workshop column for Inside Higher Ed. Follow him on Twitter: @WickSloane.
Only days away from the 2012 election, one thing is abundantly clear -- Americans are deeply worried about our system of higher education. In fact, almost 90 percent of Americans believe that higher education is in crisis. The success of this generation, and of the U.S. economy, depends on whether we can rise to meet our challenges in higher education over the next four years.
The higher ed crisis is a product of both longer-term disinvestment and a failure to structure our current programs around key goals like access, completion, and job placement. Between 2000 and 2010, state and local funding per student for higher education fell by 21 percent. This follows decades of declining investment and fuels massive tuition hikes, which have hit students hard.
Higher education policy wonks and economists generally agree that a degree is still worth it, but that choice is not always so clear to the individual student. In our surveys and conversations with students across the country, they voice concerns over rising costs, complicated financial aid systems, little guidance, and the uncertain job prospects after school. Despite the problems, about four in five young adults believe that getting an education is even more important to their success than it was to their parents'.
From a national perspective, our biggest lever to improve higher education and help students is federal financial aid. Reforming our financial aid system changes incentives for students, families and schools, and can, if done right, put us on a path to a more successful higher education system. If reform is done wrong -- without student input, for example -- it could hurt the very students we are trying to help. But we owe it to ourselves to try for real change. Higher education is too important to settle for the status quo.
Successfully reforming federal financial aid requires a student-centered approach to drive real impact and minimize adverse consequences. Having surveyed and talked to thousands of students from across the country, we have laid out four key principles that should guide reform efforts:
1. Financial aid must provide meaningful access to all students and families.
About 84 percent of young adults believe that making college more affordable should be a priority for Congress. Our government currently provides critical Pell grants to lower and middle-income students because they need it the most, but we know that college is not yet affordable for all Americans. We can do more. Reforms to grant and loan programs must ensure that higher education is accessible for all students, particularly low-income students and those from communities with historically low enrollment and completion rates. For example, we must fill the impending Pell Grant shortfall.
2. Promote a transparent system that allows students and their families to act as well-informed consumers.
Access to grant aid increases enrollment, yet too few individuals fully understand the aid available to them. Complicated applications, meager advice, low information and an opaque marketplace frequently prevent students from enrolling or finishing school. Those that do graduate too often make choices along the way that raise costs and student debt. Change can start by proving better consumer information for students and families. By making it easier for students and families to compare college prices and outcomes, we can drive competition to help bring down tuition in the long run. For example, we should streamline and simplify federal student loans so borrowers automatically default into income-based repayment.
3. Hold all stakeholders accountable for the goal of graduating students with jobs, not debt.
We know that our college graduation rates are far too low. Federal financial aid does help. In a recent study, about 4 in 5 Pell grant recipients said that their grants increased the likelihood of completing school. Aid should be even more targeted to help students complete, and all stakeholders benefiting from aid, including schools, must be accountable for that goal.
Accountability does not end, however, with graduation -- students must be connected to jobs and careers that provide an opportunity to succeed and, at the very least, to pay off student debt. This generation believes in the value of hard work, and we know it is ultimately our responsibility to work hard and succeed. However, stakeholders should be judged on whether they take every opportunity to connect hard-working students to jobs during school, and encourage graduation with a meaningful degree and manageable debt. For example, we should restructure federal work-study to better connect students to jobs, and we should reward colleges that have more low-income graduates successfully paying back the principal on their loans.
4. Make smart, innovative investments to prepare this generation for tomorrow’s economy.
The federal deficit and the Budget Control Act have increased pressure on Congress for across-the-board cuts, including further cuts to education. But we cannot simply cut our way to prosperity. When we asked young adults whether Congress should cut Pell Grants in order to address the deficit, three-quarters were opposed. Indeed, young people understand that investing in higher education is crucial for the economy: 88 percent of young people agree that increasing financial aid and making loans more affordable for post-secondary education and training helps make the economy stronger. Policymakers looking to address deficits in the name of our future should listen to the generation affected by those choices. With limited resources, policymakers must 1) invest adequate dollars in aid, and 2) efficiently distribute limited dollars. Importantly, student-oriented innovations in our federal aid system could help to increase the efficiency of those investments. For example, we should re-examine the ways in which our tax structure helps build campus gyms or attempts to incentivize college savings among families who save anyway, and spend that money instead on shoring up Pell Grants.
The political landscape in 2013 won’t be easy to navigate, regardless of what happens next week. As policymakers head back to Washington post-election and step into the next Congress, we will have to deal with a looming fiscal cliff and budget battle, expiring tax cuts, the approaching reauthorization of the Higher Education Act and No Child Left Behind. But the next year does offer a real opportunity for major reforms to our higher education status quo: it is clear that some level of change to the federal aid system is inevitable. And with the cost of college rising at scary rates, our graduation rates lagging, and student debt mounting, a comprehensive look at our federal aid system should be a top priority. Young Invincibles will be laying out a detailed policy proposal for comprehensive change to the federal financial aid system in November, only a couple weeks after the election, to help guide Congress and the president.
Change is both necessary and challenging. Students must lead the way to ensure that no one claims the mantle of “reform” or “finding efficiencies” but really means “cut.” Instead, with evidence-based, student-led, and student-centered reforms and investment, we can attain greater enrollment, higher graduation rates, better job placement, and a generation prepared for tomorrow’s economy. The time for financial aid reform is now.
Aaron Smith is co-founder and executive director of Young Invincibles.
Submitted by Ryan Craig on August 31, 2012 - 2:59am
“The United States has, overall, the most effective system of higher education the world has ever known.”
-- Clark Kerr
From a global perspective, the most distinctive characteristic of American higher education is its heterogeneity. While higher education in almost every other country is public and fairly homogeneous across institutions, private institutions are much more widely represented in the U.S., and among public colleges and universities, a high degree of heterogeneity has been tolerated. Clark Kerr’s master plan for the University of California is the archetype for American public higher education, with the UC schools charged with enrolling the top eighth of high school graduates, the CSU system enrolling the remainder of the top third, and community colleges providing access to everyone else. As Arthur Levine remarked in his preface to Higher Learning in America, 1980-2000: “The importance of the California Master Plan was that it stopped the stampede toward a single, homogeneous model of higher education. Excellence, in many purposes was chosen over mediocrity... .”
Over the next 50 years, the rest of the world looked at American colleges and universities with envy. As John Godfrey, former president of University of King’s College in Halifax, Nova Scotia, noted with an analogy fellow Canadians undoubtedly understood: “Wayne Gretzky belongs to the elite of hockey players. He is the best. I am also a hockey player. I am not the best... Nevertheless, I would really enjoy playing hockey for the Edmonton Oilers, given half a chance. I suppose the issue here is accessibility versus elitism in professional hockey. Otherwise stated, the proposition might be phrased: ‘Are we here to play hockey or just fool around?’ ”
American higher education has not shied away from elitism. The social bargain, of course, was that an unequal system, with a level of inequality of inputs across institutions far outpacing any other country, would somehow manage to reduce social inequality, i.e., students coming out of the system would be less unequal than they were coming in.
This certainly seemed to be the case through the 1980s, as a wave of merit-based upward social mobility in higher education allowed colleges to be viewed as key contributors to social equality. But while it was still possible to hold on to this guiding fiction up to the Great Recession, it is no longer. The statistics are damning; we are failing to live up to our end of the social bargain:
67 percent of entering freshmen in the class of 2010 at the 200 most selective colleges came from the top income quartile; only 15 percent came from the bottom half.
The gap in SAT scores between low-income and high-income students has widened about 40 percent in the past 40 years and is now double the gap between black and white students.
The share of students from the bottom income quartile at the 200 most selective colleges has been stuck at less than 5 percent for the past 20 years.
41 percent of low-income students entering a four-year college managed to graduate within five years, but 66 percent of high-income students did. This gap has been growing.
Only 22 percent of students at flagship universities receive Pell Grants compared to 35 percent across all colleges and universities. And among minority students, only 12 percent at flagship universities are Pell recipients compared to 24 percent across all institutions. The University of Virginia has a lower proportion of Pell recipients than Yale (11 percent vs. 13 percent).
According to Anthony Carnevale, director of Georgetown University’s Center on Education and the Workforce, “Our postsecondary system has become highly segregated by class, by race and by ethnicity. It is more and more the case that the four-year college system is whiter and more affluent, [while] the two-year system is browner and blacker and more working class and some poor. In the end, the system is predictably reflecting the advantaged in the society.”
The outputs at two-year institutions are well-known, with graduation and transfer rates typically in the 10-20 percent range despite 75 percent or more of entering students expressing a desire to earn a bachelor’s degree. Meanwhile, the key input of spending per student at two-year institutions averaged $13,000 in 2009, while private four-year colleges spent over five times more ($67,000).
Research over the past decade has demonstrated that state policies to sustain heterogeneous systems are increasing social inequality as students are matched to institutions based on their level of preparation. And the situation seems to be deteriorating as non-elite institutions have raised tuition to the extent necessary to offset declines in state support, while elite institutions have raised tuition to increase per student spending.
Higher education is receiving increasing attention as a major source of the increase in inequality and decline in social and economic mobility. Sixty-two percent of Americans raised in the top 20 percent in terms of income now remain in the top 40 percent for their entire lives, while 65 percent raised in the bottom 20 percent remain in the bottom 40 percent. So while we continue to have a merit-based system of higher education, “merit” is increasingly passed down from one generation to the next.
Elite universities -- where the Wayne Gretzkys of academe convene -- have come to recognize that this is a major problem. It has taken a while. A study by William Bowen, former president of Princeton University, found that, controlling for test scores, low-income students had no better chance of admission to 19 elite colleges than high-income students. But in the past few years, our wealthiest universities have taken action: “We need to recognize that the most serious domestic problem in the United States today is the widening gap between the children of the rich and the children of the poor," said Larry Summers when he served as president of Harvard. The context for this statement, and President Summers’ initiative, was to announce that Harvard would give full scholarships to all its lowest-income students.
Of course, even if Ivy League schools were an accurate reflection of national income distribution, it wouldn’t reverse the overall trend. In any event, this isn’t going to happen; in the rankings-driven arms race, no institution is prepared to unilaterally disarm by admitting large numbers of low-income students with lower SAT scores. Indeed, this is how some colleges have climbed the rankings ladder over the past decade: reducing the percentage of low-income students. So despite generous grant programs from our most elite institutions, it is as true as ever that diversity at top institutions means putting a rich kid from California in the same room as a rich kid from New York.
Replacing loans with grants is not how the social bargain will be remade. The most likely candidate to do so is technology. Using innovative technologies to significantly lower costs while delivering measurably excellent outcomes to students (albeit in very different ways from elite, residential institutions) is the best hope for remaking the social bargain and retaining public support for heterogeneity in American higher education.
In a world where online courses are largely text-based and priced at the same level as on-ground courses, this may seem like a distant hope. But reading the Ithaka S&R report released in May on "Barriers to Adoption of Online Learning Systems in U.S. Higher Education" -- a report co-written by Bowen and Larry Bacow, the former president of Tufts University -- it’s clear that “machine-guided learning” is emerging. According to Bowen and Bacow, machine-guided learning has the potential “to greatly expand the reach of the nation’s colleges and universities to populations currently not served, while at the same time helping to bend the cost curve in higher education... It also has the potential to benefit students by allowing them to have more targeted and personalized learning experiences.”
This is why the recent tsunami of elite university interest in massive open online courses (MOOCs) is so interesting, and yet so maddening. On the one hand, many of the technologies that are and will be deployed by companies like Coursera and edX will be instrumental in helping to test and prove the concept of machine-guided learning. On the other hand, their application in non-degree, not-for-credit courses indicates these institutions either fail to recognize or have no interest in solving the problem.
It is absolutely in the interest of elite colleges and universities to pave the highway so that, if this promise is realized, digital community colleges and state university systems will have the opportunity to drive unprecedented student outcomes for millions of students at all income levels. To do so, elite institutions need to demonstrate new technologies like adaptive learning in the context of degree programs, thereby gaining acceptance from accreditors, regulators, and prospective students.
If we continue to “fool around” with MOOCs rather than “play hockey,” the U.S. system may continue to be the most effective. But it won’t be viewed as just. And therefore either federal support for higher education will go the way of state support, or continued federal support will be linked to new policies that will increase the homogeneity of our colleges and universities. Neither are good options for elite universities.
So rather than using MOOCs to reach “needy” lifelong learners, employed professionals and alumni, much better to blaze the trail so that, through innovative applications of learning technologies, large public institutions have the opportunity to re-instill faith in the notion that continued government support for higher education is a pro- (not anti-) social enterprise.
Ryan Craig is a partner at University Ventures, a fund focused on innovation from within higher education.
Despite its many accomplishments since its enactment in 1972, the Pell Grant program has strayed in key ways from the initial conception of the Senator for whom it is now named. Instead of disadvantaged students and their families knowing years in advance of their eligibility for aid, the process of applying for and receiving a Pell Grant (and federal student aid more generally) is excessively complicated and often serves as a barrier to access. Also, roughly one in two undergraduates now receive a Pell Grant, meaning that it is far less targeted to the neediest students.
This expansion of eligibility also means that it takes a lot more money to fund Pell Grants at any given level of maximum award. Moreover, there is reason to be concerned that the recent large increases in Pell have had the unintended effect of accelerating the trend for more than a decade in which institutions move their own aid up the income scale because Pell is viewed as taking care of the neediest students.
In short, there is little evidence that the large investments over time in the Pell Grant program have moved us much closer to meeting national goals such as narrowing gaps in the participation, completion and attainment rates of rich and poor students and those from different ethnic and racial groups. In a world of more plentiful resources, this ineffectiveness might be less of a problem, but in the current climate of soaring federal deficits, it is neither likely nor desirable for Pell Grants to continue to be shielded from a sharp-eyed review of their effectiveness.
The Forgotten Middle Class
In a companion essay,
Hamid Shirvani argues for
expanding Pell by ending
federal tuition tax credits.
One way to react is to make further modifications in the current program structure in the hope that such changes will lead to greater effectiveness. But this seems a faint hope. The hundreds of pages of program rules that have accumulated over four decades are virtually indecipherable; further patches will make them more so.
A better way to proceed, in my view, is to start from scratch, including a reaffirmation or an adjustment in principles for modern times and then designing a program that meets those principles. Luckily, contrary to student loans where hundreds of billions of dollars of outstanding loans make the process of starting from scratch much more difficult, in the case of grants, every year represents a chance to start anew.
My candidates for reform principles would include a radical simplification of the application process and a better targeting of benefits to the neediest students. I would also include as a principle that Pell Grants should be better integrated with other federal policies so that they work in concert to meet key policy goals rather than the current situation where they too often work at cross-purposes.
To achieve these purposes, I suggest the following elements of a redone Pell Grant program:
1) The FAFSA should be eliminated and replaced with a provision whereby parents and students can apply for aid by allowing their federal income tax submissions to be used to calculate their eligibility for all forms of federal student aid. Families who don’t submit income tax forms but who are eligible for welfare, Medicaid, food stamps or the Earned Income Tax Credit (EITC) would be automatically eligible for the full amount of Pell Grants and other federal student aid.
2) The rules for determining eligibility for Pell Grants would be based on the 1040A income tax provisions. These tax-based amounts could be translated into categories of eligibility rather than precise dollar amounts so that students with the least family resources would have the highest category of eligibility and thus be eligible for the maximum Pell Grant award.
3) Eligibility for Pell Grants would be more restricted than is currently the case in at least two key ways. The family income of students qualifying for Pell Grants would be limited to a certain percentage of national median income or some other indicator of family financial strength. In addition, eligibility for Pell would once again be limited to students enrolled half time or more. To address the legitimate needs of the groups of students who would no longer be eligible for Pell grants, their eligibility for tuition tax credits could be enhanced (see below).
To make the overall student aid system more effective, in addition to changes made to Pell Grants, other student support policies should be changed to allow for more effective integration with Pell Grants. Three specific examples of this are:
1) Integration with tuition tax credits. For any given student, as family income increases, eligibility for tax credits should increase up to the maximum credit as Pell Grant eligibility recedes. This integration would recognize that tuition tax credits can be a more effective way of providing aid to middle-income students and students enrolled for only one course than cramming these students into Pell Grant eligibility and thereby reducing the effective maximum award for any given level of program funding.
2) Distributing other federal student aid. The formula for distributing campus-based student aid funds to institutions and LEAP funds to states should be changed so that in the future any appropriated funds would be distributed on the basis of the number of Pell Grant recipients who graduated in the previous year from that institution or institutions within a state. Institutions and states should also be given greater autonomy to spend those funds as they see fit to enhance the chances of Pell Grant recipients graduating from college.
3) Limiting in-school interest subsidies. Eligibility for in-school interest subsidies in the federal student loan programs in the future would be limited to Pell Grant recipients.
The collective effect of these changes would be to reduce substantially the $60 billion in federal funds that are currently expended annually on federal student aid, thus contributing to the overall federal deficit reduction effort. These changes also would help to make federal student aid investment more effective in meeting the goals of increasing college participation, completion and attainment and to narrow chronic equity gaps in these indexes.
Arthur M. Hauptman is a public policy consultant specializing in higher education finance issues.
The Pell Grant Program, enacted in its earliest form in 1972, provides financial assistance to lower-income students who otherwise would not be able to afford college. Award amounts depend on the family’s expected financial contribution and remaining financial need, with a current maximum award of $5,550 per year. Our economy has reaped the benefits of a more educated population as a result.
However, Pell Grants are no longer keeping up with need, and the problem of affordability is no longer limited to lower-income students. Today, a college education is unaffordable for many students who are considered middle-class, but who do not qualify for Pell Grants.
More realistic expectations of what families can afford should be reflected in Pell Grant awards. Families with higher incomes, perhaps even $100,000, should qualify for Pell Grants. And families that currently qualify should receive larger grants.
To help fund this expansion of the Pell Grant program, tuition tax credits should be eliminated. The equivalent of the tax revenue previously lost to the credits should be spent on Pell Grants.
Focus on the Neediest
In a companion essay,
Arthur Hauptman argues
for revamping Pell to
ensure that dollars flow
to the poorest students.
In 2010 Congress created the $2,500 American Opportunity Tax Credit, which is designed to give middle-income families some relief from costs for tuition, fees and course material. Yet I question the usefulness of a tax credit that only benefits families who already have the resources to pay college-related expenses. This tax credit has been most beneficial to wealthier families with an adjusted gross income of $100,000 to $180,000; they received an average credit of $1,773 in 2009. In comparison, the average credit was $1,572 for recipients with incomes of $75,000 to $99,999; $1,164 for recipients with incomes of $50,000 to $74,999; and $866 for recipients with incomes of $25,000 to $49,999.
Somewhere in between the families benefiting from the tax credit and those eligible for the Pell grant are families who have substantial need, but receive very little or no assistance from either program.
Because tax credit-equivalent funds (approximately $5.5 billion in 2009 but estimated to increase to an average of $9 billion in 2011 and 2012) most likely will not cover the full cost of expanding the existing $30 billion program, the federal government will have to spend more on Pell.
The facts for today’s students are bleak, as are the implications for future students.
Tuition is skyrocketing. The average tuition at a public four-year university for 2011-12 is $8,244, an 8.3 percent increase from the previous year that also follows a 7.9 percent increase the year before. A longer-term perspective is even more dramatic; tuition at public four-year universities, when adjusted for inflation, is more than 3.5 times greater than it was in 1981-82. Thus, a college degree is roughly 3.5 times more expensive for this generation than the previous generation.
At the same time that tuition increases are far outpacing inflation, incomes are faltering. The median household income was $49,445 in 2010. When adjusted for inflation, this represents a 6.4 percent decline since 2007 and a 7.1 percent decline since 1999. Families with declining purchasing power find it even more difficult to keep up with rising tuition. Unsurprisingly, then, the average amount of student debt for graduates of public four-year universities is also increasing, reaching $22,000 per borrower in 2010. Unless these trends change, student and family debt will continue to increase as tuition increases.
It is impossible to identify a specific income where students become ineligible for Pell grants, since awards are calculated based on a number of factors, including family size and the cost of attendance. But it is possible to identify ranges where students will probably not be eligible for Pell grants. Well over half of dependent students with a family income of $39,999 or less receive federal grants (Pell grants are by far the most common, though a small small number of other grants are included). However, less than a quarter of dependent students with family incomes of $40,000-$59,999 receive federal grants, and almost no dependent students with family incomes of $60,000 or more receive federal grants.
Who, then, do we consider to be middle-class, and can they still afford higher education? The $40,000-$59,999 range for comparing federal grant recipients is roughly equivalent to the middle quintile of household income in 2010: $38,044 to $61,735. Some would argue that this could be viewed as the true “middle” class. Yet, the long held notion of middle class has always been associated with norms that include home ownership, retirement savings, and college educations. Many might argue that the fourth quintile, with incomes from $61,736 to $100,065, and even some households in the fifth quintile, with incomes of $100,066 or more, could also be considered middle-class.
Can these families afford higher education? The average annual cost to attend a four-year public university, including room, board and expenses, is $21,447. At the higher range of the middle quintile, $60,000 is one-third of the family’s annual income for just one child. Yet, the fact that this family would likely have an expected contribution so high as to disqualify the student from Pell grant eligibility seems totally unreasonable. These students still have great financial need!
Widespread opposition to the existing Pell grant program will make expansion politically challenging. However, as President Obama has said, "A world-class education is the single most important factor in determining not just whether our kids can compete for the best jobs but whether America can out-compete countries around the world. America's business leaders understand that when it comes to education, we need to up our game. That's why we're working together to put an outstanding education within reach for every child."
If we do nothing to help students who are falling into the middle-class abyss, and if college continues to become unaffordable to a growing number of students, we must be willing to accept the consequences of a less-educated workforce at a time when a quality education is more important than ever, not only for the betterment of the individual (intellectually and financially) but for the future of our country.
Hamid Shirvani is president of California State University at Stanislaus.