April 12, 2107--Free Tuition

In cost-benefit terms the best social policy investment the United States could make would not be to spend a trillion dollars on infrastructure (though we need to do that too) but to deploy that $1.0 trillion to wipe out all outstanding student loans.

There are 44 million who borrowed money to help pay the cost of their college educations and they owe on average about $37,000. Of these borrowers, more than nine million are in default.

Those in default and those struggling to pay back what they owe are trapped in a tsunami of debt and collapsed FICO scores at a time when it is difficult for young people to find employment that pays enough to make repaying manageable. As a result record numbers continue to live with their parents well into their 30s or are reluctant to take chances to switch career paths or start their own businesses. This in turn, in macroeconomic terms, dampens growth and interferes with the traditional churn of the free market.

There are no direct correlates, no lessons from history that we can turn to as models of federal fiscal policy that would be helpful in making the case for this radical suggestion. And, to balance the debate, there are no large-scale examples on the other side of the argument that have credibility.

That is except for those times in America's history when the government stepped in to prop up or even bail out imperiled institutions. We did this in the 1930s during the Great Depression to help rescue the country from a a precarious economy and dramatically, more recently, when we did a version of the same thing to help get us through the Great Recession.

On a less dire note there was the GI Bill that was passed in 1944, toward the end of the Second World War, to provide various sorts of assistance to men and women who volunteered or were drafted to serve in the military.

The GI bill is best known for the support it provided to veterans who enrolled in various forms of education, from vocational training to college and university studies. It paid the full cost of tuition and even offered a monthly subside to help offset living expenses.

It was a massive program: 8.8 million GIs used the educational benefits with a full quarter of them (2.2 million) enrolling in post-secondary education. This not only benefitted those attending but contributed to the dramatic expansion of educational opportunities and facilities that served the nation well in subsequent decades, even after veterans completed their studies. By 1960, only 15 years after the end of the war, a new community college was founded each week, fully 50 a year for over a decade. Now there are 1,200 two-year colleges serving 7.4 million degree-seeking students.

Even those fiscal conservatives who resisted the federal government's involvement in education funding could not help but be impressed. The die was cast--higher education became a virtual right as a result of the GI Bill and its longer-term reverberations. For the first time in world history higher education became fully democratized. Not perfect, but impressive.

And those who study these matters have retrospectively found that the accrued benefits to the nation, in monetary terms, more than offset the direct costs of subsidizing this expansion of educational opportunities. There was unprecedented economic growth between 1947 and 1975 and a significant narrowing of economic inequality. The poorest 20 percent of the population saw their incomes rise at a rate higher than that of any other population cohort.

In other words there was no better engine for economic growth than offsetting the cost of offering these higher-educational opportunities.

To put it simply--better educated people, college graduates especially, earn more over their lifetimes than people with only a high school education and as a result pay more in taxes. Enough in taxes to more than cover the subsidized costs of tuition and even the monthly stipends.

Thus it is exciting to note that the New York State Legislature, pressed by 2020 presidential candidate Governor Andrew Cuomo, just this past week passed a bill to make all public colleges in the state for families earning less than $250,000 a year tuition free.

"Tuition free" is a wonderful oxymoron and one can expect to see over time some of the same economic benefits that were the result of the GI Bill.

Think, then, what a positive jolt to the nation's economy would result from wiping out all accrued student debt. This obviously would be complicated to do (forget for the moment what conservatives would say!) but it is worth thinking about and running the numbers to quantify what a benefit it would be. Increased tax revenues, among other things, would be sufficient to pay for the renewal of much of out failing infrastructure.

Governor Andrew Cuomo

July 5, 2016--Alison Bernstein

Alison Bernstein, my prodigious colleague and friend died last week. Below is a note I sent to her daughters--

Dear Emma & Julia

Here's a story about your mother from nearly 50 years ago.

It was 1969 or so and I was working at Staten Island Community College in the backwaters of higher education. The backwaters because in, traditional higher education terms, in status terms, it was doubly-challenged: it was a community college and located on very conservative Staten Island. In effect--nowhere and nothing special.

But, the president of SICC (SICK, students dubbed it), William Birenbaum, was an inspired and inspiring educator totally devoted to the purported mission of urban community colleges--for the disenfranchised to make access to a quality education welcoming and effective. 

On Staten Island, the local leadership saw the college as a version of a trade school where the male students should take business courses and the women study to be either nurses or secretaries--the college's two most popular programs.

Bill rounded up a crew of progressive educators to help him, as he put it, break some windows to enable new, more egalitarian ideas flourish. As you might imagine he was not a favorite of the Staten Island Italian Club who effectively ran the island. But Bill, if nothing else, was ambitious and persistent. So he hired "Flash" (a former dock worker and union organizer), a bunch of Vietnam veterans, one or two scholar-activists (Stanley Aronowitz and Colin Greer), diversity activists Joe Harris and Ernesto Loperena, me, and the very young Alison, a newly-minted Vassar graduate.

How did Bill find his unlikely way to Alison? How did she make her unlikely way to him and godforsaken Staten Island?

While at Vassar, Alison was involved in pressing the administration to place students on the board of trustees. She and her coconspirators wanted it to be 50-50, with 50 percent student members, but they settled for one seat, which Alsion of course occupied.

Alison being Alison, she immediately took the lead to establish a national organization for student trustees. In that era of social protest many colleges were adding students to their boards.

And with such an organization in place, again Alison being Alison, she organized a national conference of student trustees. To the second or third annual conference--during Alison's senior year--she invited Bill Birenbaum to be the keynote speaker.

He accepted in less than a heartbeat and showed up in Chicago, or wherever, roaring drunk. (We later learned we would find him in that condition by 4:30 every afternoon.)

Even when high, perhaps especially when inebriated, Bill was brilliant. In his speech, as he would put it, he did his thing. And after he was done--I wasn't there but heard he was at top of his game--he invited Alison and the rest of the organization's executive leadership to go out for drinks.

He carried on for hours over many glasses of Dewar's, his favorite. 

He was especially attracted to Alison (I feel certain in more ways than one.) Well past midnight, when all but Bill and Alison remained standing. Literally. To her he said something like the following--

"You say you want to participate in making a revolution. I respect that. In fact, I endorse it. But you can't do it at Vassar. That place is for rich kids. For the over-privileged, like you, who want to play at bringing about radical change. If you want to make a revolution in education there's no better place to do so than at two-year colleges. At mine. That's where the action in. So, if you're serious, it's time for you to shit or get off the pot."

"I want to, I want to," Alison said with her heart pounding in her chest.

"In that case, with you graduating soon, if you really are serious, which I doubt, I will hire you to be a secial presidential assistant and from that position you will be able to find things to do to help bring about social change."

"I'll be there," Alison said.

Bill said, "I will hold an office for you only until July 1st."

And the rest is history.

Not mentioned thus far in any of the many notes and testimonies or the president of the Ford Foundation's otherwise fine tribute, is Alsion's work with community colleges. 

After her time at SICC, when at the Fund For the Improvement of Post-Secondary Education (also insufficiently mentioned), Alison began a nearly 30-year deep involvement with community colleges. First from her position at FIPSE in the Department of Education and later during her two assignments at the Ford Foundation. 

With the support and encouragement of Susan Berresford, The Urban Community College Transfer Opportunity Program, which Alison conceptualized and ran, was mold breaking. Thousands of students who didn't have a friend in philanthropy, benefitted mightily by the work that Alison pioneered, advocated, and protected. It wasn't sexy like a lot of other philanthropic work, but it made a measurable difference in the lives of many.

Back in 1969, she showed up at SICC before July 1st and got off that metaphorical pot. From then on, for decades she lived and thrived and inspired.

That was a magical time of great accomplishment.

I loved her very much.
In more ways than one.

Steven

May 29, 2014--The $ of a College Education

Back in 1976 I wrote a book about the history and then current state of higher education--Second Best. The "second best" referred to how the system favored the affluent at the literal expense of the less fortunate.

One chapter was devoted to the financing of colleges and universities, especially the redistribution of assets from the working poor and lower middle class to the upper middle class and wealthy.

Studies that I cited showed that since the system disproportionately encouraged the enrollment and graduation of these latter students, tax money and other forms of assets flowed upward from those at the bottom to those at the top. The best evidence at the time showed that college graduates over their lifetimes earned about 50 percent more than those with only high school diplomas and even "some college," with some college including community college students who never went on the earn bachelors degrees.

I hoped the book, which was widely reviewed and discussed, would contribute to the debate about this unfairness and contribute to efforts to close these gaps in educational attainment and economic outcomes.

But from recent evidence it is clear that I and many others were less than effective.

This may come as something of a surprise since there is so much casual talk currently, supported by anecdotal stories, about how recent college graduates can't find jobs and are therefore moving back home, holed up again in their old bedrooms.

Friends have been telling me for years that they know this brilliant young person who graduated with honors from Georgetown or a talented student from the University of Michigan who has been looking unsuccessfully for work for the past three years. Or had to take a part time job.

From this one might suspect that the income gaps at least have narrowed and that unemployment among college grads would have risen.

But a recent study cited in the New York Times by the Economic Policy Institute, using Labor Department data, shows that the unemployment rate among college graduates is only 3 percent (while for those with "some college" it is more than 25 percent) and that the earnings gap is even more pronounced than in the past.

Five years ago grads earned 89 percent more than non-graduates, ten year ago it was 84 percent more, back in the early 1980s it was a 64 percent premium, and as my research showed it was "only" 50 percent more in the mid-1970s.

On the other hand, the most recent data reveal a shocking 98 percent advantage in earnings for college graduates when compared to those with either a high school diploma or a year or two of college. This translates to $1.0 million more in earnings over a working lifetime.

It may be true that a percentage of employed college graduates feel they are underemployed or are working in fields that do not align with their interests or aspirations; but the anecdotes, which confirm predetermined presuppositions about the state of things, do not represent the truth.

The truth however, is mixed--it is good news that college graduates are doing so comparatively well (though it is not good news that the average graduate is $25,000 in debt); but it is little comfort to think about those falling further and further behind. That was true in 1976 and, sadly, it is even more so today.