A Brand New Day for Federal Higher Education Funding

President Obama's FY 2010 Budget Proposal includes the following:

Focuses on College Completion. It is not enough for the Nation to enroll more students in college; we also need to graduate more students from college. A few States and institutions have begun to experiment with these approaches, but there is much more they can do. The Budget includes a new five-year, $2.5 billion Access and
Completion Incentive Fund to support innovative State efforts to help low-income students succeed and complete their college education. The program will include a rigorous evaluation component to ensure that we learn from what works.

If enacted, this could be a very big deal. The federal government provides higher education with a lot of money, but nearly every penny comes in the form of tax preferences, research funding, and student financial aid. Back in the late '60s and early '70s, there was talk of giving institutions direct subsidies, much as the feds had recently begun funding K-12 schools. Instead, lawmakers created the Pell grant and federal student loan program. Ever since, national higher education policy has been governed by a well-understood principle: The feds don't give colleges any money to directly support education, and in exchange the feds don't have any say in what colleges do.

This could alter that relationship, perhaps fundamentally. And for that reason, a lot of pressure will be brought to bear in the coming months to send the Access and Completion Incentive Fund to a quiet death. You won't read about in the newspapers, because nobody wants to be seen as opposing college completion, and that's not how lobbyists who know what they're doing operate. But there are plenty of folks in the higher education world who would gladly turn down $2.5 billion in order to preserve the sacred principles of institutional autonomy and federal non-interference. And if there's one thing they have in common, it's this: they're not the people educating low-income college students.

Higher education likes to speak with one voice, because that's the smart thing to do, but in reality there are all kinds of divergent interests at play. Institutions that are in the business of maintaining admissions policies that give preference to legacies, the children of wealthy donors, and graduates of classist private high schools--that is, institutions with policies that discriminate against poor students--aren't going to have any interest in trading autonomy for resources designed to help low-income students graduate, because they enroll very few low-income students, and most of them graduate anyway. If allowed, these institutions will roll right over the community colleges and public four-year institutions whose students are in great need of these resources.

To be clear, I'm not sanguine about an expanded federal role in higher education. Federal lawmakers could screw it up--there's certainly plenty of precedent. The key here is to structure the initiative so that the hard-edged federal role focuses on outcomes while preserving institutional autonomy to act in a way that best serves their students and institutional mission, and doesn't sacrifice academic standards in the bargain.

I don't know how much of an effect a new program like this will have. What I do know is that if nothing is done, the same terrible completion rates that disadvantaged students have experienced in the past will continue in the future. Institution-level graduation rates for low-income students are hard to come by, but national studies show that only 54% of students from families with income below $25,000 who begin college at a four-year institution with the goal of getting a bachelor's degree actually graduate within six years. Their four-year graduation rate is 26%. And when we break down institutional graduation rates by race/ethnicity, some truly appalling statistics emerge.

This table, for example, from a report Education Sector published last year, shows that only 14% of black students enroll in colleges where at least 70% of black students graduate within six years, while over 27% enroll in colleges where fewer than 30% of black students graduate within six years. Improving these outcomes does not inevitably lead to lowering expectations for students--quite the opposite, in fact. And contrary to popular belief, it's simply not the case that all those non-graduates eventually hang on to swirl and transfer and graduate in eight, 10 or more years. Many just don't graduate at all. If we can't fix this problem, President Obama's ambitious goals for higher education completion will come to naught.

If we had institution-level graduation rates for low-income students, I strongly suspect we would find similar results--institutions where the odds of low-income students earning a degree are so low as to call into serious question why why nobody is standing at the gate with a sign that says "Abandon All Hope, Nearly All of Ye Who Enter Here." That's what autonomy has given us. It's time to do something new.