To the Editor:
All of us in higher education should be concerned with the high levels of debt being incurred by our students and our graduates. The fear of debt is undoubtedly discouraging some prospective students from post-secondary education and is forcing career choices based more on prospective earnings than on the aptitudes and wishes of graduates.
The Department of Education has proposed to translate these legitimate concerns into a rule, aimed at for-profit colleges and universities, which would—subject to exceptions—preclude eligibility for federal student aid for students where the debt graduates incur exceeds 8 percent of their subsequent earnings.
There are several things wrong with this proposed rule, starting with the arbitrary 8-percent debt-to-earnings ratio. There may be instances where 4 percent would be a hardship, and in other situations, 10 percent might be defensible. And on the earnings side of the equation, it would be quite difficult to determine the earnings factor. People using the same data could easily come to very different conclusions.
Morest importantly, the proposed rule assumes that the purpose of post-secondary education is work-force preparation when, in fact, this is but one of several purposes. And by limiting the proposed rule to for-profit institutions, the department is discriminating against an increasingly important sector of postsecondary education. The problem of debt to probable future earnings affects the entire universe of higher education, and it is wrong to single out one sector and one group of students.
Finally, the proposed rule extends federal regulation quite close to the academic heart of the institution, something heretofore left to the governance of individual institutions and systems. If nonprofit institutions believed that a proposed rule such as this applied to them, they would understandably be up in arms.
So the issue is how to recognize the legitimate concerns of the Department of Education—concerns that have long worried many of us in higher education—while not penalizing students seeking vocational opportunities. For starters, institutions offering training for certain vocations should be required to inform prospective students that they may have difficulty repaying student loans given the relatively low wages in some fields. Culinary instruction is an illustration of this problem.
Three of the for-profit institutions have proposed a warning requirement and have suggested several other worthy approaches as alternatives to the well-intentioned but unworkable and discriminatory proposal put forth by the Department of Education. I hope the department will seriously consider these and other ideas.
Robert H. Atwell
President Emeritus
American Council on Education
Washington
Mr. Atwell has served on the boards of the Education Management Corporation and of several nonprofit private colleges.
