‘Paycheck’ aid shows promise

Disbursing student aid in smaller amounts every two weeks, “Aid Like a Paycheck,” encourages low-income college students to work harder in school and manage money better, a new study shows.

At a Hamilton Project forum today, participants presented new ideas for redesigning Pell Grants, income-based loan repayment and college cost calculators. 

Obama plan won’t control college costs

President Obama’s college rating plan won’t control college costs, an analyst argues.

Proposed changes in financial aid designed to improve completion rates could limit low-income students’ access to college, a new report warns.

Don’t worry. Keep borrowing

President Obama’s plan to rate colleges is “yet another mistaken attempt . . . to alleviate some of the symptoms of a problem without actually addressing the underlying disease,” writes Erika Johnsen. The other part of the plan — promoting income-based repayment — will make the disease worse.

The “easy, cheap and indiscriminate availability of student loans ” juices demand and helps universities raise their prices, writes Johnsen. The Obama administration keeps sending out “signals about how ‘easy’ it will be to repay these huge loans after you graduate with a little help from Your Friend, The Federal Government.”

U.S. overspends on college

The U.S. is overspending on higher ed, argues Jordan Weissmann in The Atlantic. “We devote more of our economy to postsecondary education than any other developed country (except South Korea, with whom we’re tied),” but we’re rated near the bottom in college spending “efficiency.” That’s degrees earned per percentage point of GDP spent. The chart’s weighted measure gives more credit for graduating students from four-year, rather than two-year, colleges, which boosts the U.S. rank.

“Unlike, say, Germany with its renowned apprenticeship systems,” the U.S. doesn’t offer “alternatives to college if you want a middle-class life,” writes Weissmann. “So ill-prepared young adults flood into degree programs they never finish, leaving the U.S. with some of the lowest completion rates in the developed world.” That means, “we’re spending extraordinary amounts of money to produce college dropouts.”

Student loan defaults rise — again

Student loan default rates continue to rise. After two years, 10 percent of graduates and dropouts are in default; that rises to 14.7 percent after three years. That doesn’t count borrowers who aren’t paying the full amount but are in “forbearance” or income-based repayment programs.

It’s time for a smarter (and cheaper) sheepskin

High-tech start-ups are retooling college instruction, writes venture capitalist Reid Hoffman, co-founder of LinkedIn, in The New Republic. We need to “make certification faster, cheaper and more effective too,” he writes.

. . . a diploma is essentially a communications device that signals a person’s readiness for certain jobs.

But unfortunately it’s a dumb, static communication device with roots in the 12th century.

We need to . . .  turn it into a richer, updateable, more connected record of a person’s skills, expertise, and experience. And then we need to take that record and make it part of a fully networked certification platform.

There’s a lot more to college than earning a diploma, responds Michael Gibson, who works for the anti-college Thief Foundation, in Forbes. To lower the debt to party ratio, we need to consider “all the friendships formed at school, the esprit de campus, all the networks.” What about beer pong?

College consists of: the clock tower, the stadium, the frat/sorority house and the admissions office, Gibson writes.

Taken together this is like an awful cable TV package. To get HBO, you also need to pay high prices for all those unwatchable stations like the Hallmark Channel. The future of higher education will involve unbundling this package and offering cheaper, higher quality substitutes.

The clock tower represents the amount of time spent studying a subject.

 Classes are measured in hours per week; exams are given in hour length chunks; and students need some requisite number of hours in any subject to signal mastery. It is remarkable that we still use the hour as a substitute measure for learning to this day.

. . .  we are on the cusp of having the technology to unbundle and decentralize this piece of the college puzzle. Coursera, Udacity, and other massively open online courses are only getting started in their effort to demolish the clock tower and provide the customized certification Reid Hoffman describes. What the fireplace, another medieval invention, is to the cold, the clock tower is to learning: proximity used to matter. And now it doesn’t. Central heating is better.

The stadium represents the tribal experience, which is very important to alumni. The frat house represents the friendships that lead to future networking. The admissions office confers status. These will be harder to replace than the clock tower, writes Gibson.

In the near future, the residential college experience will become a luxury item, I predict. Most people will decide it makes more sense to hang out with their friends, play beer pong, root for a professional football team and earn a low-cost career credential.

Oregon eyes tuition-free community college

Community college would be tuition-free for two years for Oregon high school graduates with a C average, under a state legislator’s proposal.

Indiana hopes to raise college graduation rates by “guiding” students to choose a “pathway” to a degree. Once students commit to a major or program of study, they’d be told which courses to take to reach their goal.

Credentials without college

“Skill-based credentials,” such as digital badges, offer a cheaper, more flexible route to a better job for adults who can’t afford the traditional college path.

The cost of Pell Grants for low- and moderate-income college students increased by 158 percent, adjusted for inflation, in five years.

Innovation? Feds side with status quo

The same day President Obama called for innovative approaches to online education to save students’ money, the Justice Department told Altius Education, an innovator in online education, that it is under investigation.

College costs, job prospects worry parents

The rising cost of college is pushing students and parents to choose less-expensive options and to focus on developing job skills rather than studying liberal arts.