By Michael Dannenberg and Mark Huelsman, Demos
College affordability and student debt are receiving lots of attention with presidential candidates and policymakers on both sides of the aisle discussing the problem and positing ideas to address it. Hillary Clinton, Bernie Sanders, and Martin O’Malley to varying degrees all have laid out plans to reduce the burden of college costs and student debt for aspiring students, families, and current borrowers. Since the issue already has served as a flashpoint between Senator Sanders and Secretary Clinton, we thought it would be useful to provide an interpretation of each plan and “correct the record” on some of the popular discussion about each plan.
O’Malley has not yet released sufficient details to assess his plan adequately. Marco Rubio, Chris Christie, and Jeb Bush have also proposed plans of various detail to fix the college affordability problem. We’ll compare them at a later date.
For now, we assess similarities and differences between Senator Sanders’ and Secretary Clinton’s plans, the most comprehensive plans to address the college affordability and student debt issues put forth by any of the 2016 candidates thus far.
Important Similarities
Before contrasting the differences between Clinton’s and Sanders’ college affordability plans, it’s worth taking a step back to acknowledge how remarkable it is to see universal agreement that higher education should be treated as a public, not private, good and that candidates are now debating how and not whether we should reinvest in our public colleges and universities and the students they serve. Each of us has written about the unconscionable net prices facing students from working class and low-income families (which you can find here and here), the need for a massive reinvestment in our public education system, and recommended a “cap on student debt” or “debt-free” college for students at public 2- and 4-year institutions (which you can find here, here, and here). To varying degrees, we have advised and the candidates have drawn from those blueprints.
And indeed in our opinion, each candidate’s plan would serve as a giant step forward in reducing harmful and counterproductive cuts in state funding and stagnation in need-based grant aid that has led directly to higher sticker price tuition levels, after financial aid out-of-pocket net prices for families, and ultimately ever increasing levels of student debt – particularly for low-income students and students of color.
In exchange for substantial additional federal resources devoted to college affordability, both Secretary Clinton’s New College Compact and Senator Sanders’ College for All Act would require states to maintain their own investment in higher education and dramatically lower the cost of attending public college for most students, reducing the need to borrow. Both plans address important investments in student support and academic programs. Both plans would be funded by asking the wealthiest Americans to pay their fair share in support of public colleges and universities.
Notable Differences
Requiring Students to Work. Verdict: Clinton more than Sanders
Secretary Clinton’s plan is based upon the expectation that we can best address the issue of college affordability when all stakeholders step up to solve it. Asking students to contribute wages from a 10-hour-per-week part-time job that they can balance with their studies is a reasonable solution. On the other hand, Senator Sanders neither requires student work outside of class, nor a contribution of earnings from it. While he doesn’t build it into his plan the same way as Clinton, he doesn’t seem opposed to part-time work given that his legislation proposes to expand work-study. We submit increased work-study participation would be a positive outcome of either plan. Several studies show that part-time work can have a positive effect on academic performance, and neither plan would put students in danger of sacrificing academics for work. (See here for a recent study — and here [on page 6] for a review of the literature.)
Help to Upper Middle Class and Wealthy Families. Verdict: Sanders more than Clinton
A key difference between both plans lies in whether families of any income level would be required to pay any portion of tuition and fees. Both plans likely would make community colleges tuition-free for anyone, regardless of income. (Note: there is a discrepancy between Sanders’s campaign fact sheet and proposed legislation as to whether only public four-year colleges or all public colleges would be tuition-free.) This was a critical recommendation from the Obama Administration’s higher education legacy. Investing in the more than 40% of American college students who attend community college is vital. These institutions have been starved of state revenue for years despite serving high numbers of low-income students and students of color and doing so by spending less than many other public and private four-year institutions. Debt levels for associate’s degree recipients are rising. By eliminating tuition and allowing students to use need-based grant aid for living costs, community colleges promise to be an affordable pathway for all students.
Here’s the rub. At four-year institutions, Senator Sanders would require states to waive tuition and fees for all students attending regardless of income. All students could then cover the cost of living expenses from family income, savings, or grant and scholarship aid. In contrast, Secretary Clinton’s New College Compact asks all families for a limited and progressively adjusted according to income, financial contribution to pay tuition and fees. Under Clinton’s plan, no student or family would have to borrow as they do now (beyond that limited family contribution) to pay tuition, fees, or books at an in-state, public four-year college or university. And very low-income families would not be expected to have the resources to contribute from earnings or savings at all. But to be clear, Clinton’s plan asks higher-income families who wish to send their children to an in-state, public four year college to contribute a reasonable amount for tuition and fees given their wealth. Those funds in turn could help support higher-quality education for everyone. A crucial distinction is not just in targeting, but the price control along with associated potential product quality effect of the two plans.
Eliminating Student Debt. Verdict: Toss Up
Both the Sanders and Clinton plans would dramatically reduce the direct costs of college (tuition, fees, and books) at public institutions and allow millions more students to graduate debt-free. Of course, students face more than just direct costs on their bill each semester, and our current system allows them to borrow up to the total cost of attendance – including room and board or living costs, computers, transportation, dependent care, and disability costs – in order to finance their studies.
Neither plan would eliminate these indirect costs entirely for all students, but both plans could help millions of students—particularly students from lower-income households—meet them without borrowing. Both would allow students to use grant aid toward the total cost of attendance, which includes room and board expenses, and there are key features of both plans that would reduce expected debt. Senator Sanders’ plan would increase work-study opportunities; Secretary Clinton’s plan would provide a huge investment in on-campus child care, reducing both cost and time burden on student parents (who make up ¼ of all college students). She would also dramatically expand public service opportunities through Americorps, which would cover all college costs and eliminate the need to borrow.
Complexity and Administration. Verdict: Toss Up
Senator Sanders’ plan is billed as generous and simple, and indeed “free tuition for all” is a powerful and easily understood message for students and families. The College for All Act would instill requirements on states and institutions that receive federal funding, including maintaining minimum levels of state investment and using funds on faculty – specifically reducing use of low-wage adjunct and contingent faculty.
Secretary Clinton’s plan can also be distilled fairly easily. For students attending community college, there would be no tuition and fees. And students would apply to four-year colleges with the guarantee that tuition, fees, and books would not require borrowing. That’s not the same thing as “free tuition;” it’s “debt-free tuition.”
Administratively, the New College Compact is a prime example of “flexible federalism,” whereby the federal government sets out goals and invests key funds, but enables states and communities to meet the goals in ways that make sense on-the-ground. In this case, the federal government will invest funds in return for the achievement of key cost, access, and quality outcomes, but states and schools can innovate and experiment to meet these goals.
If anything, Sanders’ plan demands more institutional reforms in that it would: (a) require they spend resources on full-time, tenure track faculty as opposed to adjunct faculty, and (b) require they either increase their total financial aid budgets or shift relative distribution of existing institutional aid programs away from so-called merit aid – which primarily benefits high-income students – toward need-based aid. On the other hand, Clinton’s plan is more aggressive vis-à-vis holding all colleges financially accountable for a portion of taxpayer costs associated with students who do not go on to achieve sufficient post-exit earnings.
Political Support and Risk. Verdict: Toss Up
Both Secretary Clinton and Senator Sanders have laid out plans that would require states and institutions to meet various obligations in return for an infusion of public resources to students and families. In each case, states or colleges may balk at some requirements – even if we believe any serious plan to address the college affordability crisis will require them to do their fair share. Secretary Clinton’s plan, unlike Senator Sanders’ plan, would also require “skin in the game” for colleges where students struggle to repay loans– an idea that has received enthusiastic bipartisan support, including a bill from progressive Senators Elizabeth Warren, Dick Durbin, and Jack Reed.
To be clear, both plans would provide a massive new investment in public education. Secretary Clinton’s plan would do more to target dollars at those students who can least afford to pay at four-year institutions, while Senator Sanders would provide a blanket guarantee regardless of family financial health. Both plans make an implicit pledge to students not dissimilar to the GI Bill, Pell Grant, creation of community colleges or indeed many of our investments in the public good: cost will not be a barrier to attending a public college.
Asking the Wealthy to Contribute to the Public Good. Verdict: Even
A key contributor to the college affordability and student debt crisis has been the decades-long stagnation in wages for all but the very wealthiest of Americans. Both the Sanders and Clinton plan recognize this and require those who have benefited most from economic growth – and our higher education system – to contribute to funding vital new investments for the next generation. The Sanders plan would be funded through a “Robin Hood Tax” on stocks, bonds, and derivatives. The Clinton plan would close tax loopholes and tax expenditures that currently favor the wealthiest of households. In addition, the Clinton plan’s new investments would be targeted squarely at middle- and working-class households.
The Bottom Line
As with the debate over universal healthcare in 2008, progressives should be excited that all major Democratic candidates for President are proposing bold and over-the-horizon solutions to the pressing problem of college affordability facing middle-class Americans and those striving for a shot at economic security. We encourage a healthy debate about how best to allocate new public investments in a way that makes a promise of college affordability for any aspiring student. And that debate should be had with a clear understanding of what each candidate is proposing, and how he or she plans to get there.
By Michael Dannenberg and Mark Huelsman. Dannenberg is a former senior aide to Senators Edward M. Kennedy (D-MA) and Claiborne Pell (D-RI) as well as Secretary Arne Duncan. He’s currently the Director of Strategic Initiatives at Education Reform Now. Mark Huelsman is a Senior Policy Analyst at Demos. Previously, he worked with Dannenberg as a Policy Analyst at the New America Foundation.
This is a post by Education Reform Now, an action tank devoted to cultivating leaders who champion America’s public schoolchildren, and Demos Action, the political advocacy arm of Demos.