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Grading Obama's New Higher Education Proposal: Incomplete

Obama proposes a new federal ranking system for colleges. But this will only change the way we score the competition, it won't change what colleges are competing for: loan dollars
 
 
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The past week has seen two victories for the cause of higher education. Last Thursday, the  Obama administration took a broad position on increasing access to higher education for the "middle class". On Saturday, New York state has filed a lawsuit against Donald Trump and "Trump University", accusing the political stunt man and amateur genealogist of " persistent fraudulent, illegal and deceptive conduct": apparently, the Trump institute of higher learning charged optimistic would-be moguls thousands of dollars for what amounted to standing next to a cardboard cut-out of Trump – which is probably the only way to avoid being embarrassed by his company, but still.

More has been written about the former event, though, there is not much there, not yet at least. The proposal hinges on a new mechanism (not yet described) for distributing student loans. Obama wants to institute a federal grading system for colleges, and use that system to encourage the flow of federal loan dollars toward institutions with the best "bang for the buck". (Keep your "hook-up culture" jokes to yourselves, thank you very much.)

This proposal has a radical element, already teased out by  Matthew Yglesias at Slate: it would help shift the way parents and/or students – the "consumers" of education – judge its value. Right now, almost every popular way of "ranking" colleges is almost completely dependent on selectivity; one study found that US News and World Reports rankings (probably the best known of its type) can be reproduced using only entrance exam data. None of the other stuff that supposedly goes into those evaluations (including the solicited opinions of other institutions) matters. What's more, faculty pay, student-teacher ratio, alumni-giving – the other metrics US News uses – all themselves flow from the type of student who gets into a college, not what kind of student graduates.

That same study showed "extraordinarily little relationship between institutional selectivity and educational good practices", except for "high expectations of student work". In fact, the researchers found that selectivity was negatively associated with such "good practices" as the number of "essay examinations given, instructor feedback to students, and having a supportive campus environment". In other words, highly selective institutions (and thus highly ranked institutions) depend on taking in high quality students to sustain whatever level of achievement happens afterwards. We may think of poorly ranked, public institutions as just "baby-sitting" students until graduation, but that's actually what Harvard does, and, economically, it makes sense: why spend the time and energy educating students who in all likelihood will get great jobs after graduation anyway? They will get great jobs because they went to Harvard, not because of what they learned there.

Ironically, no one will be suing any elite institutions over this, despite how their con game is almost identical to Trump's: pay thousands of dollars, get your picture taken next to some overgrown plant matter, and receive a fancy piece of paper with a famous name on it at the end of the process. And likely Trump would have gotten away with it, too, if only he'd have done what the Ivy Leagues do: turn away anyone who won't succeed anyway.

The Obama proposal suggests turning the idea of selectivity around, "testing new ways to fund college based not just on how many students enroll, but how many of them graduate and how well did they do".

This is a start, though, in the end, it is just another rankings system. Americans love ranking things, especially ranking things as a method for deciding how much to pay for them. But in any marketplace where price is determined by rankings, there is an incentive to tinkering with only the outcomes measured. Want to judge a school by its graduates' employment rate? You'll find a school that hires its graduates. Want to judge a school by its graduates' incomes? You'll find a school that "hires" already-successful graduates – and then asks them to donate the money back – because another way of judging schools is alumni donations.

 
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