Education

Higher education faces its own tea party (opinion)

The best scene in my favorite book as a child (which may explain my sense of humor—or lack thereof)—is the mad tea party in Alice’s Adventures in Wonderland. It’s a series of epic skits that add up to the most wonderfully absurd passage in the English language.

To wit, Alice is delighted when the Mad Hatter welcomes her to the party with a riddle: Why is a raven like a writing desk? She says she thinks she can figure it out. He circles back to her a few minutes later.

Mad Hatter: Have you guessed the riddle yet?
Alice: No, I give it up. What’s the answer?
Mad Hatter: I haven’t the slightest idea.

Or when the sleepy Dormouse slowly launches into a story of three sisters who live at the bottom of a well:

Alice: What did they live on?
Dormouse: They lived on treacle [molasses].
Alice: They couldn’t have done that. They’d have been ill.
Dormouse: So they were. Very ill.

But the topper is when the Mad Hatter checks his pocket watch and finds it’s broken. Apparently the March Hare has been trying to maintain or fix it with butter.

Mad Hatter: I told you butter wouldn’t suit the works.
March Hare (meekly): It was the best butter.

This was the image that came to mind as I contemplated Texas’s new requirement that all graduating high school seniors complete the FAFSA and then heard about the federal government’s sixth extension of the COVID moratorium on student loan repayment through Aug. 31. When the No. 1 policy response to our broken system of postsecondary education is more loans that will never be repaid, said loans may be the best butter, but we’re still trying to fix a watch with butter.

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It’s not only Texas. Louisiana, Illinois and Alabama also mandate completion of the federal financial aid form. New Hampshire starts next year, and the ball’s rolling on similar bills in a dozen more states. Meanwhile, a cornucopia of nonprofits and state agencies promotes FAFSA completion with the lure of millions of dollars of “free money.” In the absence of a sufficient supply of faster and cheaper pathways like apprenticeships, college still seems to be the only answer for system rulers and student guiders.

“Free” is the operative word as the Biden administration slouches towards student loan forgiveness. Prodded by progressives like Elizabeth Warren (fulminating again last week in The New York Times and pressing the president for “meaningful student debt cancellation”), no payments have been made on student loans since March 2020. The Department of Education has attempted to justify extensions by saying they “provide additional time for borrowers to plan for the resumption of payments, reducing the risk of delinquency and defaults after restart.” But I don’t know anyone who really believes this.

In March, Biden’s chief of staff bragged that his boss was “the only president in history where no one’s paid on their student loans for the entirety of his presidency.” So it’s much more likely that six successive extensions (and the push afoot for a seventh to the end of the year or beyond, which the private loan platform SoFi has already factored into its projections) have established a culture of nonpayment that will make the $100 billion (and counting) cost of the COVID loan pause look like a down payment.

It’s not just the permanent moratorium. Earlier this month ED canceled $7 billion in loans for borrowers who receive Social Security disability benefits. Then last week ED announced changes to its Public Service Loan Forgiveness and income-driven repayment programs that will lead to immediate debt cancellation for another 40,000 borrowers and move 3.6 million borrowers three years closer to debt forgiveness. While any of these actions alone may have merit, together they paint a picture of—as one grumpy higher education commentator tweeted last week—a political class that “continues to describe [student] loans as illegitimate.” He’s not wrong. Student loan forgiveness has become progressive America’s new favorite entitlement.

Enter the Mad Hatter. In the wake of the 2007–08 financial crisis and $500 billion of federal money to rescue an alphabet soup of financial institutions, President Obama took office and announced a $75 billion plan to help homeowners avoid foreclosure. Channeling the righteous anger of rich white men everywhere—and, appropriately, on the floor of the Chicago Mercantile Exchange—CNBC talking head Rick Santelli launched into a rant against “promoting bad behavior” and “subsidizing losers’ mortgages.”

His big idea: a tea party for traders to dump their derivatives in the Chicago River. Thanks to Fox News, this tempest in a teapot blew up into the anti-Obama Tea Party movement that nearly blocked health-care reform, gave us Ted Cruz reading Green Eggs and Ham, and—with a heaping spoonful of ethno-nationalism—Trump’s MAGA movement, where resentment will reign for a thousand years.

So if your salary is paid in part or in full by the $150 billion in college grants and loans doled out each year by the federal government, consider this question: Whom is loan forgiveness bailing out? First, only 15 percent of American adults have outstanding student loans. Among them are some college dropouts and graduates of schools that provided no value (for-profit and nonprofit). But that’s a small percentage of outstanding student loan debt.

The vast majority are college graduates and especially students who borrowed to attend graduate and professional schools, where six-figure debt is not uncommon. According to Brookings, “the beneficiaries of student loan forgiveness would be higher income, better educated, and whiter than beneficiaries of [any] other transfer program.”

How does America feel about bailing out a group with a median income of $76,400? My guess is even less sympathetic than Rick Santelli’s “loser” homeowners, especially as reports emerge of borrowers taking advantage of the loan moratorium to invest in crypto.

The table has been laid for another tea party. Last month, Americans for Tax Reform, a group led by Tea Party activist Grover Norquist, made the argument against the continuing moratorium in a letter to the U.S. secretary of education: “A moratorium on student loan payments is unfair to blue-collared Americans who did not rack up tens of thousands of dollars of debt and those who proactively paid off their debt. Many Americans pursued other opportunities instead of going into debt for an expensive four-year degree, such as less expensive schooling, serving in the military to receive education assistance, or working long hours to put themselves through school.”

Playing the role of Russia (which is otherwise occupied), China is fanning the flames of outrage with state media running articles alleging that America’s student loan moratorium is a “massive handout to doctors and lawyers” and is “fueling inflation” that harms the little guy. Representative Virginia Foxx, the top Republican on the House Education and Labor Committee (and voted most likely to take the bait), has taken the bait, stating, “Taxpayers have been footing the student loan bill for graduate students and Ivy League lawyers to the tune of $5 billion every month while their wallets are being drained by skyrocketing inflation. The arrogance of this administration is astonishing, and the disrespect … to the American people, over half of which [sic] do not benefit from holding a college degree is outright despicable.”

It’s all coming to a head quickly. In a meeting with the Congressional Hispanic Caucus Monday, President Biden suggested he might move forward with broad-based student loan forgiveness. To which Republicans responded: don’t go there. In press release accompanying Wednesday’s introduction of the Stop Reckless Student Loan Actions Act, five Republican senators demanded an end to the “budget-busting” moratorium and cited Norquist on the undeserving beneficiaries. All we’re waiting for is another rich white opportunist to channel his resentment in a viral video.

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I’m old enough to remember not only the birth of the Tea Party but also when for-profit colleges had friends on both sides of the aisle. Around the time of the financial crisis, for-profit colleges were riding high and counted dozens of Democratic representatives and senators as reliable supporters. Even as the Obama administration turned against the sector, there were no concerns about Congress.

If anything, cocky industry “leaders” (such as they were) focused on legislative fixes to what were perceived as regulatory misadventures. As countervailing political winds reached gale strength, for-profit colleges didn’t do the work to maintain Democratic support. Even changing the name of the industry association twice in six years couldn’t stem the defection of every single Democrat who purported to care about career and vocational education.

Moratorium qua forgiveness could well cause history to repeat itself for the other part of higher education on the other side of the aisle. With campus free speech and culture wars already dragging down Republican views of higher education, college was well on its way to becoming a partisan issue. The Trump administration attacked traditional colleges and universities along a number of fronts (Title IX, international students, taxing endowments), and we’re continuing to see reverberations at the state level (e.g., Florida’s new rule that public colleges must change accreditors every five years, which can only be intended to sow chaos).

The anticollege evolution of the Republican Party reminds me of their climate change shift two decades ago (although maybe it’s no longer OK to employ the term “evolution” in a Republican context). Up until 2000, there was little political division on climate change. Republicans and Democrats had similar views. In 2001, 49 percent of Republicans told Gallup they believed they were already seeing climate change. But by adopting climate change as his signature issue after leaving office, Vice President Al Gore and his detractors managed to put a partisan label on a nonpartisan issue. Climate change had become politicized. Eighty-two percent of Democrats now consider climate change a critical threat, while only 16 percent of Republicans do. The resulting delay is unfathomable, the resulting damage incalculable.

Between loan forgiveness and Democratic states like California and New Mexico pouring new money into free college programs, Democrats have become so knee-jerk pro-college that the Republican reflex is against. And like for-profit colleges a decade ago, traditional colleges haven’t done the work to keep Republican lawmakers onside. Robert Kelchen—a thoughtful and neutral observer of the higher education sector (or as neutral as possible considering his salary is paid by University of Tennessee at Knoxville)—believes that if Republicans take control of Congress next year, we’ll see “a serious effort to stop issuing federal student loans … this is great messaging in a GOP primary.”

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The good news for colleges and universities is that traditional colleges are everywhere, in every congressional district. (Then again, for-profit colleges once were everywhere as well, and that didn’t stop the bleeding. It can happen here.) But there are a few things public and nonprofit colleges and their Democratic cheerleaders can do to forestall doom.

  1. Colleges in red states and districts need to reach out to their representatives and senators to build stronger relationships. And more powerful than telling lawmakers how important their work is and sharing anecdotal success stories is showing they’re taking action to improve student outcomes: completion, affordability, employment. There are more than a few things red state colleges can undertake in this regard (I have some suggestions here). And in the spirit of belt-and-suspenders efforts (and perhaps protection money), appoint former Republican politicians to president and chancellor roles, as the University System of Georgia has done with Trump’s former secretary of agriculture (and ex-governor) Sonny Perdue.
  2. Democrats also have a role to play. Progressives pressuring the president should rethink whether going to the mattresses on loan forgiveness is worth the potential cost. They can also take the partisan edge off college by demonstrating they care more about socioeconomic mobility than the college monopoly by providing more than lip service to alternatives, especially apprenticeships. Democrats need to recognize that students are already voting with their feet. Overall college enrollment has fallen by nearly a million in three years. Undergraduate enrollment in some states has fallen by a third (see Code Red in Minnesota). And it’s for good reason: only a small fraction of college programs lead directly, clearly and reliably to appealing employment outcomes.

But without action, college is in for a tea party. Because Republicans are as mad as a hatter.



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