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Mar 12 - White House May Put Colleges on the Hook for Student Loans


 
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 1 week ago '18        #1
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ChrisPartlowFro 5 heat pts
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Mar 12 - White House May Put Colleges on the Hook for Student Loans
 

 
From WSJ:

WASHINGTON—The White House is weighing a measure that would require colleges and universities to take a financial stake in their students’ ability to repay government loans, an effort that could squeeze loan availability to students and reduce defaults.

For several months, Trump administration officials have been discussing enacting such a mechanism or making a push for one in Congress as part of a broader effort to combat rising college costs.

In the administration’s budget proposal released Monday, officials made brief mention of a “request to create an educational finance system that requires postsecondary institutions that accept taxpayer funds to have skin in the game through a student loan risk-sharing program.”

Such a proposal could be included in a coming executive order addressing higher education, several officials said. A draft of the order isn’t final and the specifics of exactly how a skin-in-the-game provision would work haven’t been laid out. It also isn’t clear whether the White House will back an administration proposal or urge Congress to take one up.

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The order the White House is preparing, expected in coming weeks and led by the president’s daughter Ivanka Trump, will likely touch on several hot-button issues in higher education, including a possible provision tying federal research dollars to rules about free speech on campuses, these people said.

Leaders on the Senate and House education committees are also currently negotiating a possible reauthorization of the Higher Education Act this year, the sweeping 1965 law that governs higher education and student loans. Should a risk-sharing proposal come up in Congress, it would likely be included in a larger reauthorization package.

Democrats are divided on risk-sharing proposals. In 2017, several senators, including Elizabeth Warren (D., Mass.) sponsored a “risk-sharing” bill that would have required postsecondary schools to pay a percentage of their borrowers’ defaulted loans. But a broad higher education bill introduced by House Democrats last year didn’t include a risk-sharing proposal.

Sen. Lamar Alexander (R., Tenn.), the chairmen of the Senate Education Committee, has endorsed the idea.

Other mechanisms already exist to do the same thing, but they are broadly recognized as inadequate. A school could lose federal funding, for example, if a certain percentage of its students default on their loans in a given year.

The threshold is set so high that schools seldom meet it, and some schools have taken steps—such as encouraging students to seek forbearance on loans to delay payment without default—to ensure they stay well beneath.

The Obama administration, looking to combat the problem, enacted a rule known as “gainful employment” that cut off individual degree or certificate programs if a high proportion of students were leaving with large amounts of debt and meager earnings. The rule would have primarily targeted for-profit colleges, and Education Secretary Betsy DeVos has all but halted its implementation.

The current administration has argued that all schools should face the same accountability measures.

Conservatives prefer the “skin in the game” approach because it doesn’t single out particular sectors, but rather places the onus on schools to prove their own worth.

Right now, when students take out federal loans, they are accountable for paying them back, whether or not the school they attended equipped them to find employment. If they are unable to repay, taxpayers foot the bill.

Proponents argue that, if schools were made responsible to partially or fully pay back that money, they would likely offer fewer low-quality programs or induce fewer students to attend who couldn’t ultimately pay.

Colleges and universities argue that, should such a measure be implemented, it would harm schools that take on disproportionate numbers of low-income students, like historically black colleges and universities and for-profit schools.

For that reason, it would “do more harm than good,” said Jonathan Fansmith, director of government relations at the American Council on education, a trade group representing colleges and universities in Washington.

Other advocates raise similar concerns.

“I think there is a devil in the details element here, because the purpose of the federal student loan program is to make people who might otherwise not qualify for a loan receive one,” said James Kvaal, president of the Institute for College access and Success, who broadly supports the idea of risk sharing.



Let's see who reads the details and who doesn't. This would have catastrophic implications for HBCUs.

8 comments for "Mar 12 - White House May Put Colleges on the Hook for Student Loans"

 1 week ago '17        #2
six5TheStudio 2 heat pts
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This could be a not terrible thing?


Forces schools to be truthful when it comes to what degrees won’t pay sh*t and are WORTHLESS

But also could basically turn good colleges into a 4 year party for rich kids (basically are right now anyways)

fu*k the ncaa

And fu*kkkkk betsey dumbass Devos
+4   

 1 week ago '18        #3
ChrisPartlowFro 5 heat pts OP
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 six5TheStudio said
This could be a not terrible thing?


Forces schools to be truthful when it comes to what degrees won’t pay sh*t and are WORTHLESS

But also could basically turn good colleges into a 4 year party for rich kids (basically are right now anyways)

fu*k the ncaa

And fu*kkkkk betsey dumbass Devos
I mean as the article mentioned, it’ll also negatively impact those schools who take on a large portion of minority students. HBCUs historically and empirically produce more black professionals than their counterparts.

To me that’s important if we’re serious about economic empowerment.
+3   

 7 days ago '19        #4
Covfefe2020 1 heat pts
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Say goodbye to the Liberal arts and gender studies



 7 days ago '17        #5
six5TheStudio 2 heat pts
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 ChrisPartlowFro said
I mean as the article mentioned, it’ll also negatively impact those schools who take on a large portion of minority students. HBCUs historically and empirically produce more black professionals than their counterparts.

To me that’s important if we’re serious about economic empowerment.
I agree but college isn’t everyone’s only option but if you do go don’t waste money on a bullsh*t degree that will get you nowhere
+1   

 6 days ago '18        #6
ordoabchao 24 heat pts24
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 six5TheStudio said
And fu*kkkkk betsey dumbass Devos
That bi*ch needs to be lynched by her uterus..
+1   

 6 days ago '18        #7
ChrisPartlowFro 5 heat pts OP
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 Covfefe2020 said
Say goodbye to the Liberal arts and gender studies


Isn't Econ a liberal arts degree?

 6 days ago '06        #8
DominicanLou 20 heat pts20
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 ChrisPartlowFro said
Isn't Econ a liberal arts degree?
I think it depends on the institution. At my school it was.

#econmajor

 6 days ago '10        #9
AmazinJay 3 heat pts
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This is can be a slippery slope. This is still a small step in fixing the college affordability and debt problem. We need to be bold and to stop taking baby steps on this issue.

The bigger problem is the issue of skills gap in emerging fields such as information security. We need to enhance the apprenticeship program and utilize these institutions in a way that offers hands on training in coordination with major employers. This is the type of public-private partnership we need to strengthen our workforce behind emerging fields to better compete globally and boost our economy. Want to reduce the amount of people on welfare and unemployment benefits? Lets reform the program to create a job retraining program that includes apprenticeships tied to a period while being on welfare and unemployment benefits getting people certified in a trade within 6-12 months.

What about reforming our prisons to support an initiative that re-integrates felons back into society? That includes a program to train them while incarcerated with monitored progress. It also includes creating a mental stimulus program that acts on improving mental health and psyche-a multi-step approach.

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