The Cost of Opportunity: Student Loans and Social Mobility, 2:45 - 3:45 pm

By Allie Bidwell, Communications Staff

The way that students, families, and those working at colleges and universities think and talk about higher education financing could actually be doing a disservice, Daniela Kraiem of American University claimed during a session on Monday.

“The way we talk about it makes a big difference in how we want to pay for it, and who we think should pay for it,” she said.

The words people use to describe a higher education can significantly influence how we think about what is justified in terms of service and payment. Many describe education as a “key,” a “tool,” an “engine,” and – most importantly – an “investment.”

Thinking about education as a commodity, with students as consumers and colleges as the sellers, has become the frame for conversation around higher education financing.

“This has become the frame. But what’s the problem with frames? It’s very hard to see beyond the edges,” Kraiem said.

The rhetoric is not new. Many see education – in the form of skills and knowledge – as a form of capital, with a return on the investment in the form of higher wages. But most people think about return on investment (ROI) as an individual issue. The individual student makes the investment, takes a risk, and reaps the benefits through a higher salary. But another way to think about ROI, Kraiem said, is as an investment for society.

“I pay higher taxes, I’m more likely to vote,” Kraiem explained. “The public and the private both benefit here. My argument today is that the concept of the public return is declining. We no longer hear and talk about it to the same extent.”

One downside to thinking of students as consumers, though, is that when education is treated like a commodity, the buyer bears the bulk of the risk. In this case, students bear the risk in the form of student loans, Kraiem said. Using market rhetoric, she argued, makes it difficult to regulate higher education. For example, many politicians have lambasted the Department of Education’s gainful employment regulations. Former Louisiana Gov. Bobby Jindal called it “tantamount to redlining educational opportunities,” essentially saying it would lock people out of a market, Kraiem said.

In the end, however, students understand college as an investment. Financial aid administrators and colleges can do their part to ensure the quality of education is “a sound product,” she said. They can identify and assist students at risk of dropping out, make sure students are aware of income-driven student loan repayment options, and bring back conversation about education as a public investment.

“Our education system is not just about students. It’s about having a country that is well educated. It’s about innovation for all of us,” she said. “Even more importantly, it’s important for local communities. Really think about the ways in which your institutions are parts of the community.”

 

Publication Date: 7/11/2016

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