The Dilemma of Free College

Notes from Munger are President Daniel Coleman’s monthly letters to the Birmingham-Southern College community.

Welcome back to the Hilltop! I hope everyone has had a good beginning of spring term.

During the slower academic calendar of December and January, college presidents are faced with numerous conferences. In December, I went to our accreditor’s conference in Houston along with hundreds of other college and university presidents from the Southeast. In January, I attended the Council of Independent Colleges conference in Florida with about 600 other presidents from around the country. I am writing this from National Association of Independent Colleges and Universities (NAICU) in Washington D.C.

NAICU is focused on the impact Washington has on higher education in our country. Besides rule interpretations that come from the Department of Education, which vary from administration to administration, NAICU is laser-focused on the pending Higher Education Act, which has working versions in the House and in the Senate.

When College is Free, Who Pays?

The big issue for private education is “free college,” also known as “federal-state partnership.” This bill has some proposals that make public colleges tuition free. The House version and the Senate version approach the logistical issues of paying for public college differently, but they both have “free public college” in some form. It makes sense that NAICU representing its members opposes this part of the bill.

Make no mistake, if public tuition is “free” (to the students), private colleges will have a very hard time competing. Higher education will likely look more like secondary education in the U.S., where private schools primarily serve the wealthy. Moreover, higher education in the U.S. is seen as the crown jewel of our education system; it is matched by no other country. Our secondary education system is not the envy of any country.

NAICU raises legitimate concerns. Private colleges serve just as many Pell-eligible students as public colleges and have much better outcomes metrics. With “free college” this would change.

I have listened to speakers over the last two days and have witnessed extraordinary political contortions. I feel confident that 90 percent of the room opposes school vouchers for high school; but the same group supports the equivalent for college, i.e. Pell Grants. I heard one speaker say that the bills would blow up the budget and then say in the next sentence that we should double the Pell grant program which would increase costs by a similar amount.

Another speaker said the government should “not pick winners and losers,” a speaker who likely prefers the government to pick winners and losers in other areas of our economy such as health care or finance. Nothing like self-interest to create strange “political bedfellows.” To some extent, watching these contortions has been amusing.

Because the government funds many of our students in different forms, the government has a huge amount of say in how we run our college. While my preference would be to have a huge endowment, not rely on government funding to enable all qualified students to study here, and run our school as we see fit, I am focused on the reality of our current, imperfect system – which is still the best system of higher education in the world.

What are we as a country trying to accomplish with the Higher Education Act? What is the most effective way to achieve our goals? I think we are trying to increase the accessibility of education to our entire society. We believe that higher education is the clearest, most trodden path to economic and social mobility. We believe that the opportunity for upward mobility defines us as a nation, even if we limited the access to opportunity to a large portion of our population in the past.

From my point of view, the best way to achieve these goals is not through “free higher education,” but rather through a significant increase to the funds allotted to Pell grants because it enables choice which promotes accountability. If we leave the decision of where a student should go to college to the student, then the colleges will be held accountable to the student. If not incentivized otherwise, students will pursue the colleges that bring the best results. The colleges that bring the best results will be rewarded by the students. “Free college,” much like the “Birmingham Promise Grant,” awards public universities for simply being public, not for results. The unintended consequences of taking students away from highly performing private colleges worsens the outcomes for these students and, in aggregate, hurts our economy, our society, and our country.

The House HEA Reauthorization Act has a price tag of $330 billion over 10 years. In addition to this expenditure, slightly more than 30 percent of students receive about $30 billion a year in Pell grants, which over 10 years is nearly the same price. I heard many times from different speakers that the Pell grant will not be reduced.

I think this bill will become less drastic as the House and Senate come together. We are months away from knowing what will be in it. There is a chance that it never makes it out of Congress. And yet, the HEA Reauthorization Act is a high priority for many legislators from both parties, and if something passes, it will have some impact on us at BSC. We will continue to engage with our Representatives and Senators to express our views as the bill evolves.

Conference Fatigue

At these conferences, other conferences pile on. In Florida, I met a few colleagues from the Associated Colleges of the South and attended a meeting with the National Association of Methodist Colleges and Universities. At the NAICU conference in Washington, I attended a meeting of the Southern Athletic Association with presidents of the schools in our conference. These meetings are helpful with respect to understanding how other colleges approach similar issues that we face. College presidents are surprisingly nice to each other, probably because they are lonely on their own campuses.

Now, as we approach mid-February, I can tell you unequivocally that I am conferenced out. It’s good to be back on campus.

Mea Culpa

At this point, I usually give shout outs to athletes, actors, and other extra-curricular stars. We have not had a lot of extra-curricular activity in the past six weeks, and frankly, I haven’t been to that much. This will change this month. Last Saturday however, I did go to another school’s game. I went to the Auburn-Kentucky basketball game with my son. And I was caught. Walking out, a BSC student yelled at me, “President Coleman! Go BSC!” For the avoidance of any doubt, I grew up rooting for Auburn. But if Orange and Blue ever cross the paths of our Panthers in any activity, I will be wearing black and gold head to toe!

Daniel