College Affordability: Comparing the Clinton and Sanders Plans
(Originally by Heather Gautney on http://berniesanders.com/...)
Last week Hillary Clinton came forward with her plan to address the growing college affordability crisis in this country. She is to be commended for recognizing that student debt is crippling the financial future of younger generations – and some that are not so young. Her program would be a considerable improvement on the status quo.
That said, the Clinton plan doesn’t go far enough. More importantly, it fails to place the issue of college affordability in the proper context: as a societal, rather than an individual, problem.
The Clinton plan would offer $17.5 billion per year in federal funds for states to reinvest in public higher education. It would consolidate and simplify Income-Based Repayment programs, strengthen regulatory oversight of student loans, simplify the loan application process, and expand programs to help low-income, first-generation college students.
For those who are already burdened with student debt, the Clinton plan would allow them to refinance at “today’s low interest rates” and would eliminate today’s profits for the federal government from the student loan program. It would cap loan payments to 10 percent of income and would provide total forgiveness after 20 years.
These are all good things. Significant problems remain, however. While it is presented as a “no loan” proposal to eliminate tuition-related student debt, families would still be required to pay tuition, according to a formula which determines how much they can afford to pay. (As with President Obama’s plan, community colleges would become tuition-free.)
That’s a problem. Many middle-class families today are already struggling to make ends meet, living paycheck to paycheck and often borrowing just to meet their routine expenses. This would add another large expense item to the family budget of hard-pressed middle-class households – and in many cases would add to the family’s burden of debt, despite the “no loan” label, as families borrow against their house or on credit cards to pay the tuition bill.
Students would be required to work 10 hours a week. That can be difficult for students carrying a heavy class load, especially if the work isn’t related to their studies. (Work-study programs are much more helpful in this regard.) And only lower-income students would be able to use their federal, needs-based financial aid to pay for their living expenses.
We need to fundamentally reshape the way we think about tuition at public colleges. For a number of years, public higher education was virtually free in many parts of this country. It was understood that we all benefited from living in a society where every young person with the ambition and the talent could obtain a higher education, regardless of the circumstances of their birth. It is important for us to return to that view of education as integral to America’s common wealth, and to our democracy.
In that regard, Secretary Clinton’s “New College Compact” is something of a disappointment. Instead of placing college “within reach” of every qualified American, it should be available to all people, as a public good—not contingent on individual family sacrifice, or student work requirements.
The Sanders plan, which was released last May, would make all public colleges and universities tuition-free. It would eliminate the federal “profit” from student debt and would allow students to refinance at significantly more favorable rates. (Under current conditions the undergraduate student loan rate would drop from 4.29 percent to 2.37 percent.)
There would be no payment requirements for middle-class families, and no 10-hour workweek to add on to a student’s class load. Students would be able to use federal, state and institutional need-based aid to cover room and board, books and living expenses – all major contributors to student debt. It would triple the size of the federal work-study program, and offer significant relief to current student debt holders.
Other nations have seen the wisdom of tuition-free public higher education, including Germany, Ireland, Sweden, Denmark, Norway, Finland, Iceland, and Mexico. We understood the same thing in this country for much of the 20th century in states like California and New York.
The Clinton plan is a step in the right direction. But it’s not debt free. The Sanders plan offers real solutions to the high costs of college tuition and student debt, and progress towards the building of a robust democracy.