De-Voucherizing Higher Ed

It should be reasonably obvious that for students and families struggling to afford a college education, public institutions of higher education will more often offer the best bet. But as we have seen conclusively in recent years, federal support for higher ed offered through students without regard to where they attend college has made it possible for state legislatures to cut funding for public institutions on the theory that federal aid makes higher tuitions acceptable, even as tuition at private institutions grows even faster.

Unsurprisingly, politicians focused on the college affordability problem tend to focus on public colleges and universities where costs are relatively low–e.g., the Tennessee Promise plan for two years of tuition-free community college, initiated by Republican Gov. Bill Haslam and endorsed by both President Obama and Jeb Bush; and the “debt-free college” or debt reduction proposals of Democratic presidential candidates Bernie Sanders, Martin O’Malley, and Hillary Clinton.

But a few people in higher ed policy are rethinking the original 1970s policy decision to let federal aid follow the students, allowing both public and private colleges to shift costs to Washington without necessarily passing along savings to students. Foremost among them is LSU president Alexander King, profiled in the September-October issue of the Washington Monthly by New America’s Alexander Holt.

King is an interesting figure for several reasons. First, he played a leading role in successfully fighting off very large cuts in higher ed spending this last year as Bobby Jindal sought to close a huge fiscal gap without upsetting Grover Norquist via any tax increases. Second, as Holt explains in some detail, King has been conspicuous in Washington for arguing that the “maintenance of effort” requirements that accompany most federal assistance to state governments (keeping states from using federal funds to supplant state funds that are then shifted to other priorities or “refunded” to taxpayers) should be applied to higher ed funds as well.

But third, and most importantly, King wants to revisit the decision to let federal aid follow students to private as well as public institutions, as he indicated in testimony to an a Senate committee:

In the hearing, King outlined his vision for how this could work. States have been cutting budgets and increasing tuition at public universities faster than Congress can authorize Pell Grant increases. The federal government spent $67 billion on grants and tax credits in 2014 (King also includes loans, but their cost is more complicated to estimate). King told the senators to just take $10 billion out of the direct aid program and use that money to create a matching program for states—states that fund their public institutions at high levels get a reward in federal dollars, and lose their match if they go below a certain amount.

Taking money out of the direct student aid program is still sacrilege for most Democrats—Sanders proposed paying for his plan with a “Robin Hood tax” on Wall Street while keeping the direct aid program in place. But the idea of bolstering public higher education without raising federal taxes is appealing, and as Democrats continue down the path toward debt-free college, they will find King Alexander showing them the way forward, intent on undoing the mistakes of the past.

Part of the argument, of course, is that Democrats who are fighting tooth and nail against K-12 private school voucher programs are at more than a small psychological disadvantage if they continue to accept the equivalent in higher ed (I graphically remember a Joe Lieberman staffer citing this contradiction as a reason Democrats ought to support vouchers for K-12 private schools in DC during a rather heated argument I had with him on the latter subject back in the day).

But King is also appealing to an old southern regional tradition. Even when income levels in the South were half that of the country as a whole, and even though the contributions were vitiated by jim Crow, the South typically made investments in public higher education that exceeded the per capital national average on a regular basis. It was the northeast, with its huge private college and university industry, that spearheaded direct federal aid to students rather than institutions.

Perhaps (at least among Democrats) the slogan should be “let’s de-voucherize higher ed.” It’s actually a good time of year to talk about that, as college football fans (especially in the South, at places like LSU) renew their allegiance to alma mater, even as their elected representatives put alma mater on a crash diet while continuing to subsidize those rich relatives at Private U.

Ed Kilgore

Ed Kilgore, a Monthly contributing editor, is a columnist for the Daily Intelligencer, New York magazine’s politics blog, and the managing editor for the Democratic Strategist.