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3 Ways Any Free College Plan Could Go Horribly Wrong

Topics: Data & Research

Free college is an idea with a lot of obvious appeal and merit, and probably not a snowball’s chance in hell of making it to reality in the current political climate. Still, as a cornerstone of a progressive agenda, it’s an essential way for a Democratic candidate to communicate that she or he understands the Catch-22 facing young people in America today: skip college, and potentially hamper your earning potential for life, or go to college, and possibly drown in debt and underemployment.

Hillary Clinton’s plan would offer free in-state tuition at public colleges and universities to students whose families make under $125,000 a year, as well as providing lower interest rates for student borrowers and support for students who are also parents. However, as they did when Bernie Sanders unveiled his free-college plan, critics contend that Clinton’s approach might lead to some unexpected problems.

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(Image Credit: Inbal Marilli/Unsplash)

“How it all would play out depends on the specifics of Mrs. Clinton’s proposal, many of which we simply don’t know yet,” write Scott Carlson and Beckie Supiano at The Chronicle of Higher Education. “But one thing is clear: Policy makers could easily write a free-college plan that does significant harm and questionable good.”

Among the potential problems with Clinton’s (or any) free college plan:

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  1. Tuition rates might skyrocket.

Why has tuition increased so sharply during the last few decades? In part, it might be because of increased student aid. A Federal Reserve Bank of New York report from last year found a relationship between increased federal aid and higher tuition sticker prices.

“The report’s findings show that of all three programs the Federal Direct Subsidized Loans generated a 65 cent-on-the-dollar increase on college tuition, while Pell Grants generated a 50 cent-on-the-dollar increase on college tuition,” writes Ethan Stoetzer at USA Today. “The Federal Direct Unsubsidized Loans had little to no effect on the price.”

It’s important to note that the report looks at sticker prices, not net prices, but even still, some argue that more student aid means higher real costs. For example, in his piece at Forbes, Does Federal Student Aid Cause Tuition Increases? It Certainly Enables Them, Andrew Kelly cites the Federal Reserve Bank report and other studies to show that aid increases and tuition increases are tied, if not necessarily in a direct cause-and-effect relationship.

  1. Smaller private schools could lose out.

Not every private college is a swanky, brand-name institution with a huge endowment … and smaller schools could wind up unable to compete either with their richer counterparts or public schools.

“There’s a big variable here: Mrs. Clinton’s free-college plan does not make clear whether students at private colleges could still get grants and loans from the federal government,” write Carlson and Supiano at The Chronicle of Higher Education. If not, private colleges could find themselves struggling to attract students.

  1. “Free” college isn’t really free.

Free tuition is nothing to sneeze out, but tuition isn’t the only expense facing students embarking on an education. Living expenses add to the tab, as do books and fees.

Of course, without tuition, those bills are a lot easier to contemplate. But any legislation that intends to ease the burden of education debt on students and their families would have to address the other costs that come with going to school—ensuring, for example, that students still have access to (non-predatory) loans to help underwrite the rest of their expenses.

Unless the legislative climate changes, however, this discussion will remain academic.

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Jen Hubley Luckwaldt
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