House Likely to Support DeVos’ Proposed Changes to the Federal Student Aid System

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On November 28th, Betsy DeVos spoke at the Federal Student Aid’s Training Conference for Financial Aid Professionals to propose an overhaul of the 1965 Higher Education Act. The proposal includes making student loans more available to non-traditional students and modernizing the FSA system, which is currently burdened by antiquated bureaucracy. The House recently indicated that they are willing to support DeVos’ proposed changes.

 

DeVos began her FSA speech by stating her belief that “it’s important to focus on individual students and their unique needs. It’s no secret that the world is changing rapidly, and the requirements and demands for tomorrow’s workforce are dynamic and evolving.” She stated the single-minded emphasis on the four-year degree as the sole path to success has not worked for every American. She emphasized the reality that most Americans will be working in multiple fields in their lifetime and that most universities do not prepare one for a more entrepreneurial career.

 

Because of these realities, she stated her support for upcoming proposed changes to the Higher Education Act of 1965 which she says is “a child of the 60s.”. In her mind, “Our country has changed more than a little since then! Our approach to higher education should as well.” She indicated that she wanted financial aid to work better for non-traditional students, especially those who work in college. In addition, she stated her desire to modernize the bureaucracy at the FSA to make it “the most trusted lender in the industry”. Part of this process would be simplifying the application process for student aid. DeVos concluded with the sentiment that “…we’re all here for…students, not systems. People, not paperwork. We want you to be able to work for students, unencumbered by the unnecessary and the outdated.”

 

On the morning of November, the 29th, House leadership indicated that it wanted to move forward with some of the proposals by the Department of Education. A framework for a massive sweeping change to education reform was laid out. This displays that both congress and the Trump administration are unified on this issue, especially considering that the house leadership is willing to consider such radical changes in an election year.

 

The bill’s first focus is on revamping the student loan program. It will include a cap on the amount graduate student’s and undergraduate student parents can borrow. It will also end the program that forgives the student debt for those who work in the government or certain nonprofits after ten years of payments. It would also end the provisions that allowed student borrowers to have some debt forgiven after 20-25 years of payments. Lastly, it will end the tying of payments to income. One should note that all current borrowers would be grandfathered in. These cuts are in part due to conservatives’’ and republicans’ beliefs that the current generosity of student loans has contributed to the dramatic increase in college costs. In addition, this bill also mandates that if students cannot pay a portion of their student loans, government will force institutions to do so. This is intended to make institution’s accountable for the real-world success of their program’s and curriculum.

 

This bill also increases doubles federal funding for work-study programs. It also allows more off-campus jobs to be part of the work-study program. One particularly interesting provision is the allocation of $183million to fund two-years or less apprenticeship programs. This money would be sent to community colleges across the nation to buy equipment and create specialized programs that would target growing industries. The success of this program would be measured by recording student earnings one and three years after graduation. One of the primary concerns by the chairman that wrote this bill, Rep. Virginia Fox, was that “we have a shortage of 6 million skilled workers”. The portions of the bill previously listed attempt to solve this issue.

 

This bill will also attempt to make students’ and families’’ interaction with the government bureaucracy easier. The FASFA form will be simplified from the current 100 questions and will become available on mobile devices. This specific provision has wide bi-partisan support. In addition, the existing College Navigator website will be replaced. A new dashboard will be created the includes “aggregated information on enrollment, completion, average debt and average salaries five and 10 years after graduation”. However, personal student post-graduation salary records will not be kept. In part, this is due to a 2008 ban on the practice.

 

Most analysists believe this bill will create “winners and losers”. Junior colleges will be big “winners” as they receive the substantial funding to cooperate with the private sector noted earlier. Another big winner will be for-profit schools, who will receive equal footing with non-profits when it comes to limits on federal aid and measures of student success. However, some student borrowers will have to bear a greater shar of the burden. In addition, the established four-years schools will most likely lobby against it in part because this bill will siphon off enrollment for many four-year schools (because it decreases the generosity of student loans) and revises the College Navigator website (something the higher ed establishment has lobbied against for years).

 

This bill comes at a time when Republicans are increasingly doing worse and worse amongst young people. A recent NBC news poll found that only 19% of millennials identify as Republicans. Even more worrisome is that 71% of millennials do not believe that the Republican party does not care about people like them. In addition, Republican identification amongst millennials is even more stratified along racial lines than ever before. In an increasingly diverse country, this could be very harmful. On the bright side, 50% of youth do not lean towards voting for either party and 29% identify as independents. While some of these may be far-left Berniecrats that will never support Republicans, it does show that while Republicans have a toxic reputation amongst millennials, not all millennials are loyal democrats.

 

Perhaps meaningful education reform will allow Republicans to win back millennials. At the least, it could win them the support of the next generation, Gen-Z, which should be Republican leaning regardless. It will have to be redder than blood to counteract the deficit amongst Millennials unless something changes. In short, if Republicans can convince young voters that they are best prepared to help them enter the workforce, they will reclaim the youth vote, and remain viable. Otherwise, the 2020’s and 2030’s will be long decades for Republicans. While tax reform may be the sexier issue at this moment, this education reform bill could have the greatest long-term effects.

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