Americans have poured billions of dollars into propping up institutions of higher learning. But the value and popularity of a college degree is plummeting, and with that comes a greater drive to hold higher education accountable.
The American Enterprise Institute published a new study Monday, “Untapped potential: Making the higher education market work for students and taxpayers,” that tackles how to hold schools accountable without expanding the federal government’s role in higher education.
The authors, Andrew P. Kelly and Kevin James, conclude with three broad ways to “modernize” the system: create a performance floor for schools receiving federal aid, delegate oversight away from the badly organized current accreditation system, and ensure that students have better information on exactly what they’re going into thousands of dollars of debt for.
Kelly and James make the case that, while Americans have long been proud of their education system, “a cursory examination of a range of student outcomes…reveals serious cracks in the facade of excellence”:
On a 2013 international assessment of adult skills, America’s college and university graduates scored below international averages on numeracy and literacy.6 And the effective student loan delinquency rate-which applies to, among others, students granted forbearance from payments because of hardship-is now as high as the delinquency rate on subprime mortgages at the height of the housing crisis.7
They go on to argue that consumers of American higher education suffer from several major defects in the system, including lack of knowledge, and lack of accountability from the accreditation process meant to keep the institutions in check.
Students often choose a college with little information on how likely their choice actually is to positively impact their future. They may end up selecting a school based purely on prestige or tuition, for example, rather than the job prospects they will gain from a specific major at a particular university.
And when a student chooses badly, based on misleading promises from poor schools, they waste federal dollars with no consequences: “With only limited ways to validate those promises, these disadvantaged students often wind up using federal grants and loans for programs that fail to deliver educational value.”
Meanwhile, the federal government relies partly on the accreditation process to maintain a certain threshold of performance in these federally-backed schools. But the current system is hardly built for such a task. Since the accreditation system was “designed as a process of self-regulation or peer review,” the incentive to report under-performing schools remains extremely low. And according to AEI, the Department of Education hardly ever punishes an accreditation agency for shirking its duties.
At the same time, the accreditation process makes it nearly impossible for new and innovative schools to break in, at a time when creative alternatives to the current higher education system are sorely needed.
AEI rounds up some of the dismal results of these policies:
The authors push back on the movement to solve all this by simply granting more regulatory power to the federal government. They propose collecting and distributing more information to students on graduation rates, expected earnings after graduation, and other relevant information to help students make better decisions. They also call for establishing a strict performance floor that would ban under-performing institutions from receiving federal aid.
They suggest handing oversight to external groups that could more realistically evaluate college performance, like a “consortia of employers, nonprofit groups, or professional associations.” And they encourage giving them “skin in the game” by punishing faulty evaluations.
The study’s findings and recommendations can be read in full here.
