A child born into poverty has a 5 percent chance of making it to the top quintile without a college degree, but chances almost quadruple if that child were to go to college.
WASHINGTON — President Barack Obama is starting to fill out an initiative he announced in August to increase access to upper-level education for lower-income students, and to ensure that those from marginalized communities are best equipped to finish their schooling and obtain a degree.
Last week, the president and Michelle Obama jointly hosted around 80 college and university presidents at the White House to discuss these issues and to make new pledges on how these institutions would tackle them. Around 100 universities and several dozen major NGOs and foundations made more than 100 new commitments aimed at expanding upper-level education and graduation opportunities.
These included particular new focus on early interventions aimed at assisting low-income and students of color in deciding on schools and programs, strengthening advising and standardized testing preparations, and increasing remedial learning options to ensure that students are able to quickly get to the same point academically. The White House’s report on the issue can be found here.
“We still have a long way to go to unlock the doors of higher education to more Americans and especially lower-income Americans. We’re going to have to make sure they’re ready to walk through those doors,” Obama stated at the event, held Jan. 16.
“Unfortunately, today only 30 percent of low-income students enroll in college right after high school and, far worse, by their mid-20s only 9 percent earn a bachelor’s degree … There is this huge cohort of talent that we’re not tapping.”
Since his re-election, Obama’s second-term domestic agenda has increasingly turned to issues of inequality, with the current push for a rise in the federal minimum wage expected to be included prominently in his State of the Union speech on Tuesday.
With relations between congressional Republicans and the president remaining notably dysfunctional, however, Obama has made clear that he will devote increasing energy reforms that would require neither legislation nor congressional approval. The new programs announced last week, coming from universities, civil society and the private sector, are in line with that approach.
“I’ve got a pen to take executive actions where Congress won’t, and I’ve got a telephone to rally folks around the country on this mission,” the president stated. “And today is a great example of how, without a whole bunch of new legislation, we can advance this agenda.”
The new university announcements are the early result of an August speech in which the president unveiled a major new focus on increasing access to university, ensuring high-quality education and making college more affordable. At the time, his administration also announced a new goal: to put in place policies that would result in the U.S. leading the world in share of college graduates by 2020.
Simultaneously, such a goal would offer one of the most powerful ways available to reduce inequality in the U.S. According to statistics released by the White House, a child born into poverty (in the bottom economic quintile) has just a 5 percent chance of making it to the top quintile without a college degree. These chances almost quadruple if that child were to go to college.
Nonetheless, just 9 percent of students in the bottom quintile get their bachelor’s degree by the time their 25, compared to 54 percent of those in the top.
“Unemployment for Americans with a college degree is more than a third lower than the national average. Incomes – twice as high as those without a high school diploma,” Obama told the gathering of university presidents and others. “[M]ore than ever, a college degree is the surest path to a stable, middle-class life.”
As the job market has changed in recent decades, the number of Americans with college degrees has gone up sharply, for nearly all demographics. In 2012, more than a third of those 25 to 29 years old had at least a bachelor’s degree, compared to just a quarter in 1995.
Much of this increase can be put down to a parallel surge in those enrolling in upper-level education in the first place, however. While this is clearly a positive trend, overall completion rates remain low. Indeed, current statistics suggest that just 38 percent of students in four-year programs graduate on time, and just 21 percent of students in two-year programs.
Today, such statistics are increasingly leading to calls from policymakers and civil society to enact a range of policy reforms, both to better prepare students from all backgrounds for higher education and to make sure that they have the support and incentives required to graduate.
“This is an issue has been pressing for a long time, but times are catching up now,” Julia Lopez, president of the College Access Foundation, a philanthropy that provides up to 5,000 scholarships to low-income students in California every year, told MintPress.
“There’s a real and increasing recognition – including from the business community – that we need more graduates. We have to figure out how to better serve those students we haven’t focused on in the past.”
Lopez says she supports Obama’s use of his “bully pulpit” to focus on issues of increasing college access for lower-income students. Yet she also lauds the White House for refocusing the related discussion back on what responsibilities colleges and universities can shoulder on an institutional basis.
“The conventional view is that this is an issue that has to get dealt with at the student level, suggesting that the onus needs to be on better preparation of the kids. But there’s significant evidence that what institutions do can do a lot to increase success, particularly for lower-income students,” she said.
“What we know from working with these kids and low-income schools is that if they see the opportunity and understand that they need to grab it, they will. We track our students, and we know they do better once they get into college – in terms of stay in college – than all other kids on campus.”
While Lopez congratulates Obama on having gotten a raft of new commitments from U.S. colleges and universities, she notes that the next key question will be how to maintain a strict monitoring regime to ensure that the new pledges are being strongly implemented.
“We won’t see new evidence for four or six years,” she said. “In some ways, if someone doesn’t keep these institutions’ feet to the fire, it will simply be business as usual.”
The debt bubble
Of course, one of the most significant structural obstacles to higher education for many students today remains the fast-rising cost of education and the often crippling debt load that a college degree has come to entail. According to research by the Economic Policy Institute, a think tank here, college costs have risen by 130 percent over the past three decades, even as incomes have grown by just 11 percent.
During the 2011-12 school year, students reportedly paid more than $154 billion in college tuition and fees, nearly 70 percent of which came from federal loans. Last year Obama was able to double the amount of money available through federal student loan programs. Yet because of political fighting in Congress, the rates at which these loans have been offered over the past decade have varied substantially.
This has led to a massive and likely unsustainable bloom in the amount of student debt in the U.S. Today, some 40 million people owe more than $1 trillion for their educations, a tripling of the household student debt since just the late 1980s. That figure eclipses both debt on credit cards and car loans. Further, many analysts say such high debt levels are not only providing a tremendous drag on new graduates but ultimately slowing post-recession economic growth.
“Student debt is keeping young borrowers from buying homes, buying cars and saving for retirement,” Sen. Elizabeth Warren said this week, announcing that she would be introducing legislation that would allow students to refinance onerous interest rates on their student loans.
“Families expect to be able to refinance their mortgages, and they should expect to be able to refinance their student loan debt too,” Warren said, noting that the federal government is making “obscene profits” on its loan programs for students.
Wall Street investors, too, have been criticized for their role in pumping up profits at student expense. The private loan industry is thought to make up around $150 billion of the total current student debt, and some financial sector actors have been accused of engaging in predatory behavior around education funding.
Multiple government regulators are currently investigating Sallie Mae, which holds around 15 percent of all U.S. student loans, making it the largest such servicer in the country. And just this week, New York Gov. Andrew Cuomo announced the creation of a new watchdog group aimed at protecting New York students from dodgy lenders.
“We’re at a different point today in this fight, and there’s more energy than there was two years ago. But it’s still not enough,” Natalia Abrams, co-founder of the advocacy group Student Debt Crisis, told MintPress.
“I don’t think the mainstream media quite understands yet that this is the next big bubble – as big as the housing bubble, if not bigger. Some legislators are now getting around to this, but the crisis point was actually a couple of years ago when we hit $1.2 trillion [in debt]. And we’re still not really doing anything to loosen this gauge.”