University Business - July 2006 - (Page 58)

Higher Ed at the Crossroads Scott, president of Adelphi University N.Y. . What the commission is doing is a good thing, even though In part it stems from a desire by members of Congress and I don't agree with all the proposals that I've heard about, says other political bodies to cut back on any public spending, and they John Fry, president of Franklin & Marshall College Pa. . It gets view higher education more as a private gain rather than a pub- people to stop and think about what they are doing. There has lic good, says Scott. That's why some of the members are con- been a complacency, almost a smugness, in this industry among necting between accountability and the various federal student aid the people who are in it. Sure, we probably do [higher education] programs consolidate and eliminate. They want to cut funding better than any another country in the world, but it doesn't mean and I think they are using the desire for more accountability as the we have it all together. leverage to cut funding. Fry says the disagreement among commission members and within the larger education community is healthy. I like the fact Affordability that people are pushing, and I think that is a very good process. It C sets up conversations now that we should be having maybe we losely tied to the question of aid is the cost of higher end up in different places, maybe some other recommendations education and the ability of the public to afford it. Ac- will come up, but it will be good for this industry. cording to some studies, two-thirds of students gradu- ating from four-year colleges have student loans to pay Aid off, and the average college graduate carries $17,000 in debt. For W a new graduate in an entry-level job, the burden to repay student hile the commission has had some heated debates, loans can be overwhelming. its members all agree that more resources must be Interest rates are going up this year a lot, and I think that will directed to need-based student aid. However, they make it obviously a lot less affordable for students to get financial haven't yet determined how this should be done. aid, says O'Dell. At that point it's not `Can I get financial aid?' Some argue that financial aid funding should be increased across Instead it's, `Can I pay it back?' You are going to have a whole lot the board, while others believe existing funds should be redirected of people in 20 years who are going to default on their student to need-based aid. Several proposals call for replacing the large va- loans. Right now we're seeing the tip of the iceberg of what the riety of grant, loan, and tax-credit programs with just one or two crisis could become if we keep denying students affordable ways to federal aid programs. get through college. Although total aid spending has increased over the years, low- Steps can be taken to rectify the situation and, more impor- income students are receiving a smaller share of the pie. According tantly, they can be taken now, says financial aid expert Robert to the National Association of State Student Grant and Aid Pro- Shireman, executive director of the Institute on College Access and grams www.nassgap.org , states distributed a total of $7.9 billion Success and director of the Project on Student Debt. in financial aid over 2004-2005, 8 percent more than the previous The project was launched last summer with support of the Pew year. However, need-based aid continued to slip, dropping from 81 Charitable Trusts, the William and Flora Hewlett Foundation, and percent of total aid awarded in 1999 to 73 percent last year. other philanthropies to identify cost-effective solutions that expand Some observers question the motivation of commission mem- educational opportunity and protect family financial security. bers as they sort through the aid picture. Education is under- While student loans are important to helping people afford col- funded, and funds at the federal level are being misdirected, says lege, they can also have a negative impact, particularly for someone Anne O'Dell, a representative for EdFed, a student loan company. from a low-income family to enroll in college, says Shireman. It Some of the commission members come from private sector busi- becomes something that can put their own financial futures at risk. ness backgrounds not really something that I think should be Higher debt levels can impact a student's ability to begin saving strongly involved in what happens to higher education. for retirement or for their childrens' education. It can also affect The apparent desire to reduce total aid spending may reflect the their ability to follow the career track that makes the most sense for current political climate more than anything, suggests Robert A. There has been a complacency, almost a smugness, in this industry among the people who are in it. Sure, we probably do [higher education] better than any another country in the world, but it doesn't mean we have it all together. John Fry, Franklin & Marshall College 58 | July 2006 universitybusiness.com HigherEd.indd 58 6/21/06 2:19:42 PM http://universitybusiness.com

Table of Contents for the Digital Edition of University Business - July 2006

Contents
College Index
Advisory Board
Company Index
Editor's Note
People Watch
Sense of Place
Stats Watcch
Viewpoint
Marketing
Human Resources
Future Shock
Money Matters
Community Colleges
Diamond in the Mudd
Higher Ed at the Crossroads
Property Values
The President Next Door
Good Medicine
The Outs (and Ins) of Facility Management
Business Technology
What's New
Calendar of Events
Direct Connect
End Note

University Business - July 2006