The Laudable Pursuit: Higher Education Needs a HERO

Senator Mike Lee
2017-12-15 13:27:25
December 15, 2017 "to elevate the condition of men--to lift artificial weights from all shoulders, to clear the paths of laudable pursuit for all, to afford all an unfettered start and a fair chance, in the race of life." --Abraham Lincoln Chairman's Note: Higher Education Needs a HERO The dawn of the 21st century has brought tremendous opportunities and changes to our economy. Everyone now needs some kind of education after high school. Yet, only four in ten Americans achieve an associate's degree or higher. It's a new game, and it's essential that all citizens can still pursue their American dreams. We need a higher education system that works better for more Americans and their families. We can begin this process by focusing on four key reform principles: accountability, affordability, transparency, and innovation. These principles are at the heart of the Higher Education Reform Opportunity (HERO) Act introduced in the Senate this past week. Affordability Between 1982 and 2007, the average cost of a four-year college education rose by 439%, according to the biennial report from the National Center for Public Policy and Higher Education-and costs have only continued to rise in the past decade. The typical solution to the unaffordability problem has been to increase the amount and types of loans that students can access. However, this solution has actually contributed to the exponential rise in tuition rates. In 2015, the Federal Reserve Bank of New York issued a study that found "a pass-through effect on tuition of changes in subsidized loan maximums of about 60 cents on the dollar." This means that for every additional dollar the federal government allows students to borrow, colleges and universities increase their tuition by 60 cents, thus increasing the number of students who "need" loans to "afford" college in the first place. The HERO Act would address the affordability issue by streamlining the current duplicative menu of student loan programs into one option and creating one repayment period for undergraduate loans and another for graduate loans. Additionally, the act would establish caps on loan amounts, which would help to keep university rate increases in check and lower the amount of debt students need to repay once they graduate from college. Transparency Informed consumers are a critical component of a free-market economy. Yet when it comes to choosing a good college and major, parents and students are often left to make these life-changing decisions in the dark. The HERO Act would ensure that parents and students have access to information about how effective their college of choice is in helping students graduate on time; how burdened by debt students are after obtaining their degrees; and how successful graduates in a particular major are at obtaining jobs that enable them to pay back their loans. Accountability Nearly half of borrowers today are not making payments on their student loans. This alarming statistic is one of the reasons some economists have predicted that student loans are the next financial bubble. It is time for a change. One promising solution is to make sure that all parties in higher education have "skin in the game." The HERO Act would ensure that colleges have a financial stake in their programs by requiring schools with poor student loan repayment rates to pay a fine. The possibility of a penalty would motivate schools to invest in the success of their students. Innovation Today's post-secondary students come from a range of different backgrounds, from the traditional 18-year-old high school graduate, to the single mom going back to school, to the laid-off worker who needs to retrain mid-career. Meeting the needs of this diverse population means we need a lot more options than we did when current federal policies were first written decades ago. The HERO Act would accomplish this by changing the way schools are accredited. The HERO Act would enable each state to accredit any institution that provides post-secondary education. With this new accreditation power, states would be able to authorize innovative new education options (for example, massive online open courses, competency-based offerings, and certification exams) for students in any learning situation. Today's students deserve an innovative higher education system that provides more and better options to prepare them for the challenges and opportunities of today's job market. The HERO Act is an important first step toward building that new system. It would open the door to the American Dream for the millions of Americans who are pursuing it. Higher Education Reform Opportunity Act Click here to watch video Issue in Focus: The Rise in Unwed Childbearing Too often, legislators pass bills that seem to be solutions in search of problems. But those problems are rarely as straightforward as they appear to be. This is why my staff at the Joint Economic Committee (JEC) have worked so tirelessly on the Social Capital Project - a multi-year research initiative that explores the evolving nature and importance of our associational life, specifically why the health of those associational relationships seems so compromised. And of all the relationships people have in their lives, the most important and formative is the one children have with their parents. This relationship is the foundation of a healthy associational life, which is why the JEC's most recent study focused on parent/child relationships and how they've changed in the last few generations. As many of you already know, there has been a significant uptick in children born to unwed parents since 1960. And numerous studies show children of stable, married couples outperform children born to single parents, especially when it comes to laying the foundation for engagement in associational life. This isn't to say a child born to single mother or father will necessarily face more challenges in life, or that a child born to a married mother and father will automatically succeed. But there is a statistically significant pattern that shows having two stable parents in a committed relationship does give a child a leg up. Yet, in the past few decades, we've shifted from this two-parent model of child-bearing. In 1960, just 5.3% of children were born to single mothers. As of 2008, that number jumped to 40%, and that number is even higher for children born to mothers who are under 30. This means 35% more of the children born today are born into a situation that disadvantages them. While it would be simple to point to increased sexual activity as the obvious cause, our research found two even larger factors: 1) there are fewer married women, and 2) the cultural norm often referred to as the "shotgun" marriage has all but disappeared. The causes for these two trends are also very complicated, but they appear to be a result of an increase in affluence and opportunity in society as a whole. Rising affluence and opportunity is absolutely something we should celebrate, but that doesn't negate the fact that the uptick in non-married births is something that should be addressed. Problems are rarely as straightforward as they appear to be. I am proud of the work my staff on the JEC is doing to shine a light on the complexities of this issue, and we will continue to pursue this line of inquiry to ensure all children are born with the leg up they deserve. Washington, D.C. Office 361A Russell Senate Office Building Washington, D.C., 20510 Phone: 202.224.5444 Fax: 202.228.1168 Salt Lake City Wallace F. Bennett Federal Building 125 South State, Suite 4225 Salt Lake City, UT 84138 Phone: 801.524.5933 Fax: 801.524.5730 St. George Office of Senator Michael S. Lee 285 West Tabernacle, Suite 200 St. George, UT 84770 Phone: 435.628.5514 SaveSaveSave SaveSave SaveSaveSave Save Save Save Save Save Save SaveSave SaveSaveSave SaveSave Save This message was intended for: xxx You were added to the system October 2, 2015. 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December 15, 2017

"to elevate the condition of men--to lift artificial weights from all shoulders, to clear the paths of laudable pursuit for all, to afford all an unfettered start and a fair chance, in the race of life." --Abraham Lincoln

Chairman's Note: Higher Education Needs a HERO

The dawn of the 21st century has brought tremendous opportunities and changes to our economy. Everyone now needs some kind of education after high school.  Yet, only four"in ten Americans achieve an associate’s degree or higher.
 
It’s a new game, and it’s essential that all citizens can still pursue their American dreams.  We need a higher education system that works better for more Americans and their families. We can begin this process by focusing on four key reform principles: accountability, affordability, transparency, and innovation. These principles are at the heart of the Higher Education Reform Opportunity (HERO) Act introduced in the Senate this past week.
 
Affordability
Between 1982 and 2007, the average cost of a four-year college education rose by 439%, according to the biennial"report from the National Center for Public Policy and Higher Education—and costs have only continued to rise in the past decade. The typical solution to the unaffordability problem has been to increase the amount and types of loans that students can access.
 
However, this solution has actually contributed to the exponential rise in tuition rates. In 2015, the"Federal Reserve Bank of New York issued a study that found “a pass-through effect on tuition of changes in subsidized loan maximums of about 60 cents on the dollar.” This means that for every additional dollar the federal government allows students to borrow, colleges and universities increase their tuition by 60 cents, thus increasing the number of students who “need” loans to “afford” college in the first place.
 
The HERO Act would address the affordability issue by streamlining the current duplicative menu of student loan programs into one option and creating one repayment period for undergraduate loans and another for graduate loans. Additionally, the act would establish caps on loan amounts, which would help to keep university rate increases in check and lower the amount of debt students need to repay once they graduate from college.
 
Transparency
Informed consumers are a critical component of a free-market economy. Yet when it comes to choosing a good college and major, parents and students are often left to make these life-changing decisions in the dark.
 
The HERO Act would ensure that parents and students have access to information about how effective their college of choice is in helping students graduate on time; how burdened by debt students are after obtaining their degrees; and how successful graduates in a particular major are at obtaining jobs that enable them to pay back their loans.
 
Accountability
Nearly"half of borrowers today are not making payments on their student loans. This alarming statistic is one of the reasons some economists have predicted that student loans are the next financial bubble. It is time for a change.
 
One promising solution is to make sure that all parties in higher education have “skin in the game.” The HERO Act would ensure that colleges have a financial stake in their programs by requiring schools with poor student loan repayment rates to pay a fine. The possibility of a penalty would motivate schools to invest in the success of their students.
 
Innovation
Today’s post-secondary students come from a range of different backgrounds, from the traditional 18-year-old high school graduate, to the single mom going back to school, to the laid-off worker who needs to retrain mid-career. Meeting the needs of this diverse population means we need a lot more options than we did when current federal policies were first written decades ago.
 
The HERO Act would accomplish this by changing the way schools are accredited. The HERO Act would enable each state to accredit any institution that provides post-secondary education. With this new accreditation power, states would be able to authorize innovative new education options (for example, massive online open courses, competency-based offerings, and certification exams) for students in any learning situation.
 
Today’s students deserve an innovative higher education system that provides more and better options to prepare them for the challenges and opportunities of today’s job market. The HERO Act is an important first step toward building that new system. It would open the door to the American Dream for the millions of Americans who are pursuing it.

Higher Education Reform Opportunity Act

Click here to watch video

  

Issue in Focus: The Rise in Unwed Childbearing

Too often, legislators pass bills that seem to be solutions in search of problems. But those problems are rarely as straightforward as they appear to be.
 
This is why my staff at the Joint Economic Committee (JEC) have worked so tirelessly on the Social Capital Project – a multi-year research initiative that explores the evolving nature and importance of our associational life, specifically why the health of those associational relationships seems so compromised.
 
And of all the relationships people have in their lives, the most important and formative is the one children have with their parents. This relationship is the foundation of a healthy associational life, which is why the JEC’s most recent study focused on parent/child relationships and how they’ve changed in the last few generations.
 
As many of you already know, there has been a significant uptick in children born to unwed parents since 1960. And numerous studies show children of stable, married couples outperform children born to single parents, especially when it comes to laying the foundation for engagement in associational life.
 
This isn’t to say a child born to single mother or father will necessarily face more challenges in life, or that a child born to a married mother and father will automatically succeed. But there is a statistically significant pattern that shows having two stable parents in a committed relationship does give a child a leg up.
 
Yet, in the past few decades, we’ve shifted from this two-parent model of child-bearing. In 1960, just 5.3% of children were born to single mothers. As of 2008, that number jumped to 40%, and that number is even higher for children born to mothers who are under 30. This means 35% more of the children born today are born into a situation that disadvantages them.
 
While it would be simple to point to increased sexual activity as the obvious cause, our research found two even larger factors: 1) there are fewer married women, and 2) the cultural norm often referred to as the “shotgun” marriage has all but disappeared.
 
The causes for these two trends are also very complicated, but they appear to be a result of an increase in affluence and opportunity in society as a whole. Rising affluence and opportunity is absolutely something we should celebrate, but that doesn’t negate the fact that the uptick in non-married births is something that should be addressed.
 
Problems are rarely as straightforward as they appear to be. I am proud of the work my staff on the JEC is doing to shine a light on the complexities of this issue, and we will continue to pursue this line of inquiry to ensure all children are born with the leg up they deserve.

 

Washington, D.C. Office
361A Russell Senate Office Building
Washington, D.C., 20510
Phone: 202.224.5444
Fax: 202.228.1168

Salt Lake City
Wallace F. Bennett Federal Building
125 South State, Suite 4225
Salt Lake City, UT 84138
Phone: 801.524.5933
Fax: 801.524.5730

St. George
Office of Senator Michael S. Lee
285 West Tabernacle, Suite 200
St. George, UT 84770
Phone: 435.628.5514




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