Tag Archives: policy change

Assets, Education, and the American Dream

Earlier this week, I wrote about my work at the Assets and Education Initiative, and what we’re trying to do to sort of upend the conversation about financial aid and higher education and student debt, in pursuit of an education system–and a way of financing it–capable of delivering far more equitable outcomes for those disadvantaged today.

Today, I want to share some of the resources and tools we’ve developed as part of this.

I know that most of my readers are touched in some way by our higher education system–indeed, I would argue that we all are, at least indirectly, given that education is so powerful in shaping economic opportunities and structures–as students or recent graduates, faculty members or advocates.

We are certainly not alone in raising these questions, but I am proud of the role that we’re playing, and I am excited to more explicitly share this work with you, in a sort of ‘full circle’ way.

I would welcome your comments and questions. One of the most fun things about working in an evolving field is the ability to be pretty nimble and responsive, like when a reporter’s question about the level of savings that it would really take for a Children’s Savings Account to make a difference for a student’s likelihood of going to college led to a new line of research that revealed, somewhat startlingly, significant improvements in educational outcomes just from opening a savings account, and sizable differences for those students with about $500 saved.

Your question might just spark the next line of inquiry; regardless, these are conversations we must have.

Our education system isn’t just about who we are today, or what students encounter upon enrollment.

It’s about who we will become and the stories we tell ourselves about what is possible in this country.

It is an honor to be part of that.

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A 21st Century Financial Aid Policy

I have come to believe that we need dramatic changes in our financial aid system.

We have largely eroded the supports that used to be there for low-income students seeking to go to college: In the 2010-2011 school year, the maximum Pell Grant award covered only 36% of the average cost of attendance at a public four-year institution, compared to 77% in 1979-1980.

More students are having to borrow more money to leap the chasm between what they can really afford and how much college costs. Today, the median college debt is about $28,000 per year, even though research reveals the potential for significant negative effects–on college graduation and post-secondary financial outcomes–starting at only about $10,000 in borrowing.

So more students are deterred from enrolling at all, put off by high-dollar debt or uncertain about whether college is really worth it.

To me, this makes financial aid reform more than just an academic exercise (no pun intended); it is a policy imperative.

I’m working now on a report outlining AEDI’s priorities for policy changes, and so I want to use this space–and your generosity with your time–to elicit some input as we outline a way forward. The good news about being at the beginning of a policy reform effort is that there are many options. The hard thing, of course, is trying to, collectively, think differently than we ever have before.

I believe that identifying the right options–some workable, some aspirational, across the levers of potential influence–is key to getting these conversations started. And I am audacious enough to ask for your help with that. Thank you in advance!

  • Reinvest in higher education as a collective good, to reduce the growth in college costs and reflect the truth that higher education is a common value, as much as an individual asset
  • Minimize the negative effects of student debt, especially as we shift from debt-dependent to asset-based financial aid. This means that policymakers should explore provision of ‘emergency’ aid, to prevent disruptions in academic progress often associated with financial setbacks; incentives for educational attainment, potentially including at least partial loan forgiveness for on-time degree completion for Pell-eligible students; and policies that reduce debt burdens, including income-based repayment and incentives for employer matching for student debt repayment following graduation.
  • Support college graduates as they strive to build assets, perhaps through diverting some loan repayments to savings accounts (as we do in the HUD Self-Sufficiency program, with rents), protecting graduates’ credit scores from student loan effects, and directing the financial services industry to aggressively extend savings opportunities to Americans.
  • Improve quality of K-12 education, to reduce the need for remediation in college and close the gap between how children need to perform and what they are prepared to do–too many students are failed in high school and then have to pay to catch up in college. Since educational quality is highly inequitable, too, this serves to exacerbate other layers of inequity.
  • Eliminate disincentives for college savings in the public assistance and means-tested financial aid systems–today, we have a bifurcated financial aid system, where wealthy students mostly enjoy asset-based financing, while low-income students grapple with the fallout of high-dollar debt. And strict asset limits in financial aid and public assistance determinations enforce this inequity.
  • Incorporate savings into current financial aid programs, using the variable of timing to convert them into ‘early commitment’ programs. This might mean incorporating savings into the Pell Grant program and/or diverting some scholarship money from academic merit-based to rewarding savings, at the university or local level.
  • Build progressive, lifelong, universal, asset-building child savings structure, paralleling asset incentives through the tax code for wealthy students. To make Child Savings Accounts (CSAs) work for low-income households, some policy features are essential: automatic enrollment (opt-out), ideally at birth; initial deposits that give all children an immediate stake in their futures; program features to ease access, like low initial deposit requirements; concerted outreach and education; and special incentives, such as refundable tax credits and/or direct matches. Accounts should be in students’ names, and at least some of the deposits should be available as they go through school, to help them confront financial obstacles to academic achievement.

What’s missing? What concerns you? What confuses you?

What is your vision for a financial aid policy for tomorrow’s challenges, and how do you think we get there?

Student debt, ladders of opportunity, and the next generation

My work at the Assets and Education Initiative has given me an outlet for a passion of mine–restoring the American Dream for disadvantaged young people–and also brought into sharp relief the intersection (sometimes collision) of my personal and professional lives.

Because my students won’t face high student loan debt on their paths to higher education.

They won’t have to wonder if college is really a part of their futures.

And, so, they won’t face the tragic Catch-22 that is commonplace in so many communities, and around so many kitchen tables, in the United States today:

Being unable to grasp the bottom rung of the ladder that would pull you up.

Education doesn’t work the way it’s supposed to, anymore.

One of the most stunning statistics, which I have taken to telling just about everyone, is this:

While 69% of the highest-achieving children from low-income families attend college, this is only slightly greater than the enrollment rate for the the lowest-achieving children from high-income families (65%).

To me, this says that the path to higher education and, then, economic security (because that is still largely true, even with rising economic uncertainty for U.S. college graduates) more closely resembles one of inertia than the ‘Horatio Alger’ stories we like to tell ourselves.

Working really hard and being really talented only gets you a 4% advantage over those who largely fail but have wealthy parents.

Changing this story so that college is the opportunity I believe we want it to be for today’s young people will require reforming financial aid, focusing our efforts on those in greatest economic need, recognizing the importance of higher education as a ladder to mobility, and breaking across policy sectors to reform education, particularly in terms of ensuring quality instruction and supporting students toward their completion of valuable degrees.

It will require dismantling the ‘cradle to nowhere pipeline’ that currently traps so many of our youth and recognizing the economic imperative of putting the U.S. back on par with nations around the world that have differently prioritized education (and are seeing differential outcomes as a result).

It will require, then, telling ourselves a different story.

Because all’s not well that ends well, and our over-reliance on student is reducing equity within higher education.

Because college is a distant dream, not an imminent reality, for too many disadvantaged children.

Because my kids will never have to compete, not really, with children in poverty.

And that’s not fair.

Reimagining Poverty Part II

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The second of our speakers series on Reimagining Poverty is tomorrow!

I’m excited to welcome Dr. Tom Shapiro to the university, and really looking forward to hearing him talk about race, poverty, and inequity.

Dr. Shapiro’s work is pretty stunning; if you haven’t read Black Wealth/White Wealth, you really should.

His scholarship exposes the extent to which differential access to institutions influences radically disparate outcomes for blacks and whites in the U.S. economy. For example, a $1.00 increase in income = a $5.00 increase in wealth for whites, but only $0.70 for blacks.

Yeah, really.

As he has said, “The genius of the American dream is the promise that those who work equally hard will reap roughly equal rewards, be it in wealth, lifestyle, or status.”

Statistics like the above make it clear that that promise is largely being broken.

Combating poverty in the U.S. absolutely requires acknowledging–and committing to dismantle–institutional racism.

That’s not a reassuring realization, certainly, but it’s a critical one, and I am glad that we’re helping to spark that conversation.

I feel like a lot of my work and, so, many of my reflections here, are converging now: the All-In Nation effort that I’ll be posting on in a few weeks, my alignment with the Kansas City Equity Profile team, my AEDI emphasis on the links between poverty and education.

So Rich, So Poor makes the point that school quality is an antipoverty strategy, not only because making sure that every child has access to a quality education will equip American children to climb out of poverty, but, more importantly from a structural perspective, because taking school quality off the table as a driver of residential choice would deconcentrate inner-city poverty and dramatically reduce racial segregation.

That could be a game changer.

If educational reform is the seminal civil rights challenge of this generation, we must redouble our efforts to examine how the institution of education is failing children and families in poverty, from preschool through their heavily-leveraged college degrees.

I hope you’ll join us tomorrow as we continue this conversation, either in person at the Kansas Union at the University, or following along on the live webstream from home.

Let’s reimagine poverty, yes, but then let’s end it, so that, by the time they grow up, it exists only in my children’s imaginations.

Close knowledge makes a difference

There was another part from The Ghost Map that made me think about social work, and about you all, which means that it ends up here.

So, yes, just a little more cholera.

See, the doctor who ended up tracing the spread of the disease, and documenting the outbreak in a way that gave needed credibility to germ theory and ultimately brought down the idea of ‘miasma’ (smell=disease), was from the neighborhood.

He lived near Broad Street, where the pump contaminated with cholera was located, and that intimate knowledge was essential to helping him untangle the truth.

At the time, remember, most people thought that, since smell brought disease, dirty houses (read: poor people) would have the most illness, because they would smell bad. There were many low-income households in and around the area infected with cholera, and, so, most of the ‘outside experts’ were quick to conclude that it was their poverty, and the smells associated with it, that were quite literally killing them.

But John Snow knew better.

He knew of wealthier households living next to poorer ones, where both fell ill. He knew of very poor households that nonetheless maintained immaculately clean homes. He knew that most of the stereotypes were flawed. He knew that people were dying–real people, with grieving families–because he knew many of those afflicted.

This knowledge meant that he couldn’t fall back on the prevailing wisdom or the platitudes about poverty and disease. He could see facts more clearly, and his inquiry had an urgency stemming from his investment in the community and its suffering people.

And that, I believe, has lessons for social work advocates, too.

I believe that we can work effectively across communities, and that skills and relationships and real empathy are just as important as ‘matching’ membership on specific criteria.

But I also believe that it might be easier to miss things, nuances that really matter, if we see a community more as monolithic, which we’re more likely to do if we’re not embedded in it. I believe that too much distance can render us less effective, less committed, and, ultimately, less likely to succeed.

That’s one of the reasons that social workers make great organizers, and great advocates–we’re on the ground and we know how these issues work and we tend to notice details. We know and care about our work, and that matters for how we engage with it.

In history and still today, being close to the truth makes it more likely we find it.