Manajemen Pendidikan Tinggi

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Can Higher Ed Change America’s Negative View?

Several national polls make it clear that the public and policy makers are not happy with higher education institutions. Much of the discontent is coming from forces beyond higher education’s control, but colleges and universities are not helpless. I see three primary reasons for their fall from grace that they can and must work harder to address.

First, college is more expensive than ever for many families. Fewer families can afford college tuition. And while our country reflects greater income inequality than in the past, membership in the middle class has become exceedingly hard to attain without a degree. A bachelor’s degree doubles expected lifetime earnings. Yes, colleges and universities are in a difficult place. Even as many of their students’ families have stagnating incomes, colleges’ labor costs are rising since the market rewards the people with higher degrees -- namely, those whom colleges and universities hire. Decreases in state support have made things even more challenging for public institutions, which have increased tuition to try to maintain quality. And need-based financial aid has not kept up or has been scaled back. Higher education institutions must tackle the affordability issue more aggressively.

Second, campus politics are aggravating the public’s unhappiness with higher education. Many campuses are struggling around issues of free speech and academic freedom, with speakers thwarted from expressing their ideas by those who differ with them. When students disrupt speakers, it generates criticism from the public. Taxpayers, including parents, wonder how students receiving financial support are spending their time. While most students on most campuses are not involved in such activities, these events capture the headlines. In response, many higher education institutions have reaffirmed a commitment to free speech and academic freedom as core to the generation of knowledge. That is not enough. More college leaders must encourage greater political diversity and diversity of thought.

Third, outlier stories about high loan burdens and lack of preparation for jobs have increased mistrust, even though the evidence on jobs and loans does not support the criticisms. All the evidence shows that an associate or bachelor’s degree increases lifetime earnings.These benefits are not just limited to the people studying and going into STEM or business fields. Data show the earnings impact of a humanities or liberal arts degree -- it is worth the investment, similar to other degrees. Occupation does matter -- engineers and some science fields do better in terms of earnings -- but not everyone wants to go into those fields, nor would everyone excel at them. And there is no evidence, except anecdotal, that a liberal arts education dooms one to a life working behind the counter in a coffee shop.

The stories about loan burdens are beyond misleading. The actual evidence suggests that the increase in expected lifetime earnings makes borrowing for college a great investment. About 61 percent of bachelor’s recipients borrow, with an average loan total of $28,100. The impact of a college degree on earnings allows for loan repayment in a short period of time. There will always be exceptions, with variance around the averages, but income-contingent repayment is the right way to deal with much of this. It is also the case that loan default rates are highest for the people who borrow less than $5,000 and don’t get a degree, most of whom are students at for-profit colleges.

The worst outcome would be for low- and middle-income families to stop borrowing to invest in their children’s education. Avoiding loans will condemn students to lower lifetime earnings and all that accompanies that.

Helping students and families make good decisions about borrowing to invest in education is only one part of the equation. Colleges must control costs and allocate as much as possible to need-based financial aid in exchange for students and families incurring debt. In addition to finding and admitting students, colleges and universities also must do all they can to make sure students graduate. That means helping community college students get their associate degrees in reasonable time and helping those who want to go on to earn four-year degrees, as well as improving the graduation rate at four-year institutions.

One risk of the general discontent with higher education is that it will result in decreased public financial support, as we have recently witnessed with the passage of the Tax Cuts and Jobs Act, which included an excise tax on some college endowments. Given large public subsidies to higher education, it is completely appropriate for the government and taxpayers to ask how these subsidies are being used and to provide legislative incentives to improve educational and economic outcomes for Americans. Unfortunately, the recently passed tax bill did not do anything to address the challenges facing higher education and families hoping to invest in their own or their children’s education. The tax bill could easily have required highly endowed institutions to increase support for low- and middle-income students. Instead, the tax changes could hurt those students as colleges rebalance budgets. That was a missed opportunity for policy makers to encourage greater commitments to need-based financial aid.

The next steps are clear. Colleges and universities must regain the public trust through their policies or risk losing further support. Containing costs, making commitments to support low- and middle-income students, working to improve graduation rates, helping students transition to the workplace, and ensuring that the commitment to free speech and academic freedom is real are all needed. It doesn’t matter that colleges and universities have not created the challenges they are facing. It will take real progress in these areas for policy makers and the public to see higher education institutions as part of the solution rather than part of the problem.

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