It is becoming increasingly obvious that the current financial aid system is insufficient to meet the goals of 21st century higher education. The complicated system is difficult for students to understand and often does not serve their needs, Regina Deil-Amen of the University of Arizona argued as part of a daylong conference on reinventing the financial aid system Tuesday at AEI. The experts who participated in the conference discussed a variety of potential innovations to reform the system.
Sara Goldrick-Rab of the University of Wisconsin-Madison struck a provocative chord when she suggested reversing the original Pell Grant program to give grant dollars to institutions, not students, in an effort to hold institutions accountable.
The topic of accountability carried through to the student loan program. Debbie Cochrane of the Institute for College Access and Success pushed back on another panelist's proposal for risk management by arguing that institutions, not just students, should be held responsible for the risks of student loan debt. The American Council on Education's Terry Hartle questioned whether some borrowers are just so ill-prepared that it is unwise to let them borrow.
Three things are clear: good research propels good policy, students need better information, and the design of financial aid policy has consequences for generations to come. Consultant David Mundel challenged the audience to dive into the fray and make a difference rather than just complaining about the status quo.
For more than half a century, student financial aid programs have played a crucial role in increasing the number of Americans with access to a college education. Pell Grants, student loans, and G.I. Bill benefits have helped make America one of the most educated nations in the world.
But despite increased spending on financial aid programs, completion rates remain stagnant. Moreover, college tuition growth has eaten away at the purchasing power of grant programs and has saddled students and families with nearly $1 trillion in debt.
Instead of focusing on building new financial aid tools and approaches, contemporary education policy debates are prioritizing increasing grant amounts, expanding loan limits, or lowering interest rates. This research conference will push past tired discussions to explore opportunities for a more fundamental rethinking of the way aid is designed and delivered. At this conference, America’s foremost thinkers on financial aid reform will discuss new research on how innovations in financial aid policy can create a more effective and sustainable system.
If you are unable to attend, we welcome you to watch the event live on this page. Full video will be posted within 24 hours.