Toward a New Focus on Outcomes in Higher Education

Toward a New Focus on Outcomes in Higher Education

Remarks by Secretary Arne Duncan at the University of Maryland-Baltimore County (UMBC), July 27, 2015
July 27, 2015

Thank you, Ganesh. I said all of us here work for the students, so please give him another round of applause.

America’s students know what they want out of college. They want an education that will set them on a path to success. They want control of their future, without decades of overwhelming debt. They want a college degree that will help them thrive, support a family, shape the world and contribute to their communities.

For many students, that’s not just a dream. For them, our nation’s world-class colleges and universities and strong credential programs offer a clear path to civic engagement, economic security and success. For them, college is literally a transformative time in their lives that shapes their future in profoundly positive ways.

But unfortunately, for millions of other students, our higher education system isn’t delivering what they need, or deserve.

As a nation, we can change that – and we must.

The challenge we face is easy to articulate, if not to solve. Today, the critical ticket to the middle class is a degree or credential after high school that employers recognize and value. That’s equally true whether you’re fresh out of high school or a career-changer with grown kids, whether you’re headed for a leafy residential campus or to your local community college.

The simple fact is, every hard-working student in this country must have a real opportunity to achieve a meaningful, affordable degree. America’s prosperity, our democracy, and our identity as a land of opportunity, depends on it.

But to get there, we have to think differently. The idea of the past century that public education goes from kindergarten to high school is over. We must make the shift to a vision of quality education that begins much earlier in preschool and continues through postsecondary success.

This Administration has done a lot to help pave the way for progress, but there is a lot of heavy lifting and culture change ahead.

Some of the change is about money. College costs too much for too many families, and the price continues to rise. Debt is a deep, deep worry for far too many people that constrains opportunities post-graduation.

But let’s be clear. It’s not just about cost and debt.

Because the hard truth is is, for those who start college, it’s a coin toss whether they’ll get that critically important degree. Barely half will complete their degree in a reasonable time at four-year institutions; and at two-year schools it’s only about a third.

At career colleges, even more will drop out, and more than 3 out of 4 of them will have debt. And some who attend unethical schools will end up with a credential that means little to nothing to employers.

There is a path to a higher education system that serves many, many more students much better. And continuing to make college more accessible and affordable – including more tuition-free and debt-free degrees – is absolutely part of that. But it’s only part.

Simply put, if we limit the discussion to cost and debt, we will have failed. We will have only found better ways to pay for a system today that fails far too many of our students. Our vision must be bigger than that.

Make no mistake: Our administration will not let up in our efforts to help more students pay for college, to break the upward cycle of cost, to crack down on bad actors that take advantage of students and taxpayers. And we will continue to strengthen our enforcement efforts.

But as a nation, we must go further. We must reset the incentives that underpin the system so the focus is on the outcome that matters: completing a quality degree at a reasonable cost. And we must have the courage to embrace innovations that meet the needs of a student body that has changed enormously in recent decades.

Over time, as the need for a degree has increased, a much wider swath of the American population is enrolling in college, and that’s a very good thing.

Hollywood may depict college students as 18-year olds in dorms, but nearly four out of every ten college students are older than 24 years old– and in community colleges, it’s almost half.

Older students are much more likely to work full-time and to juggle multiple roles--employee, spouse, parent--and they are much less likely to enroll continuously full-time while they work to obtain their degree.

In fact, more than a third of all undergraduates today transfer credits from one institution to another as they progress towards their degree.

The heightened need for college, and the far greater diversity of the population seeking it, defines both the challenge and the amazing opportunity ahead of us. The answer, I believe, requires three major shifts –

first, dealing with cost and debt;
second, focusing much more on outcomes;
And third, driving desperately-needed innovation

Together, these changes represent the higher education challenge of our generation.

Let’s start with the primary worry for so many students today.

A spiral of cost and debt today threatens to take college, America’s engine of social mobility, and kick it into reverse.

Over the past three decades, tuition at a four-year college has more than doubled, even after adjusting for inflation. The consequences are significant; over the last two decades, the average amount owed by a typical student loan borrower with a BA more than doubled, to nearly $27,000.

And the very fear about cost and debt stops millions of students from even pursuing and finishing the education they need.

The need is urgent to rein in the cost of college, to create more tuition-free and zero-debt pathways, and to reverse the shocking slide in state support for higher education--which is the primary driver behind escalating tuition.

In the face of these challenges, I’m proud to say that our administration has taken unprecedented action.

President Obama has laid out the America’s College Promise plan, now introduced and awaiting action in Congress. The bill would provide zero-tuition community college to nine million students each year at 1,300 community colleges, making two years of college as universal as high school became in the 20th century to the great benefit of our Nation’s economy.

We have cracked down on predatory and fraudulent behavior, reining in bad actors that saddle students with debt and worthless degrees. And we dramatically expanded financial aid for low income students and their families.

Since 2008, our administration has increased total aid available to students by over $50 billion [dollars] and increased tax benefits and credits by an additional $12 billion [dollars], all part of a total of about $150 billion [dollars] in grants and loans each year for higher education. More than two million additional students now receive Pell Grants, and the maximum Pell award has increased by more than a thousand dollars. Many of those additional two million students are first generation college goers who now have their chance to pursue the American dream.

We have implemented a series of reforms that aim to drive down the cost of college and to help more students afford it. A simpler online FAFSA has helped to raise the number of completed applications by nearly 4.8 million over five years.

And we’re working to make both the real costs and benefits of college far more transparent for students and families.

With the launch of the College Scorecard, the voluntary adoption of the Financial Aid Shopping Sheet by more than 3,000 institutions, and additional comparative information on outcomes and college value we will make available later this summer, consumers will have much better information about their college choices. Transparency will also drive accountability to improve results.

And we are helping to make debt much more manageable. As late as mid-2012, fewer than a million borrowers were in income-driven repayment plans, which allow borrowers to cap their monthly payments based on what they earn. President Obama’s expansion effort has nearly quadrupled participation, and both delinquencies and defaults are down.

In very real terms, this means that the young man or woman who dreams of being a teacher, a social worker, an artist, or a nurse now knows that they can pursue their dream without worry about unmanageable debt that will prevent them from buying their first house or car. That’s good for them, that’s good for our economy, it’s good for our society.

But there’s so much much further to go in making college more affordable.

A lot of my friends here in Washington have been talking about the need for debt-free degrees. And they're right. Students must have many more pathways to tuition- and debt-free degrees. The America’s College Promise plan is a huge part of helping us getting there.

We want to do even more, developing experimental sites that will make Pell grants available to programs that award credentials based on demonstrated competency, to incarcerated adults seeking an independent, productive life after they get out of jail, and to adult learners who enroll in short-term certificate programs that provide meaningful job-ready training.

But cost and debt are just one part, one part of this fight.

Student debt is a burden for too many students, but most ultimately repay their loans, and for those who get their degree, college is an excellent investment. By some estimates, a bachelor’s degree increases lifetime earnings on average by about a million dollars.

The degree students truly can’t afford is the one they don’t complete, or that employers don’t value.

Students who drop out of school are three times as likely to default on their student loans as those who graduate. In fact, the amount of debt is not the main reason people default. The typical defaulted borrower is carrying less than $9,000 [dollars] in debt.

The completion challenge is not just hurting far too many individuals, it’s costing us as a Nation on an international scale. Even as a degree has become critical in a globally global economy, America has fallen from first in the world in the college completion rates of our young people to twelfth. There can be no pride in that.

College also must be an equalizer of opportunity, but the richest quarter of students are four times more likely than the poorest quarter to earn their bachelor’s degree. Whether we look at overall completion rates or inequality of opportunity, clearly we are not close to where we need to be.

We must shift incentives at every level to focus on student success, not just on access. When students win, everyone wins. But when they lose, every part of the system should share responsibility.

Today, only students, families and taxpayers lose when students don’t succeed, and that makes no sense. Institutions must be held accountable when they get paid by students and taxpayers but fail to deliver a quality education. So should states and accreditors who are responsible to oversee them under the law.

By the same token, schools should be rewarded for doing the right thing –taking in students who are struggling and helping them succeed. We must do so much more to support those colleges that have proven their ability to help first generation college goers and poor students to both succeed and flourish in higher education.

Federal and state governments and accreditors all need to flip the current incentives. Collectively, we must focus less on inputs—like enrollment and spending—and more on outputs, like completion rates and degrees awarded, and whether those degrees have real value in the marketplace, especially for low-income students.

LSU’s president, who you’ll hear from later, King Alexander has said that “higher education needs real accountability, not less of it.”

That means everyone – Congress, states, accreditors, our Department of Education, all of us – must do business differently.

Let’s start with Congress.

In 2006, under a Republican president, the Spellings Commission on Higher Education found—and I quote -- “a remarkable absence of accountability mechanisms to ensure that colleges succeed in educating our students.” Over the past decade, quite frankly not much has changed.

Congress delegated the role of quality assurance to accreditors. And Congress, with the support of the higher education lobby, has actually barred the federal government from establishing criteria for accrediting agencies to assess student achievement.

Likewise, many members of Congress, Democratic and Republican, continue to try to block our efforts to protect students and taxpayers from unethical career colleges.

President Obama has put forward far-reaching proposals to encourage states to stop disinvesting and increase support for higher education, and reward institutions for achieving great outcomes for low-income students. Congress has not acted on those proposals.

I remain hopeful that Congress will act on America’s College Promise. That’s just one way that Congress can follow the lead of successful states like Tennessee and take good work to scale.

I hope, too, that Congress will reverse its opposition to accountability in higher education and join our efforts to improve student outcomes. Students, their families and the American taxpayers who fund this enterprise, they all deserve better.

As it stands, where Congress has asked for little accountability, accreditors have provided little. For the most part, accreditation organizations are the watchdogs that don’t bark.

According to a recent Wall Street Journal investigation, 11 schools with six-year graduation rates in the single digits--below 10 percent! -- still managed to earn a seal of approval from accreditors. When asked if a college with a 10 percent graduation rate can be doing a good job, the accreditor responded: “It can be a good school for those 10 percent who graduate.”

The six regional organizations that accredit 1,500 four-year colleges rescinded membership for just 18 schools. And even Corinthian Colleges remained accredited right up to their recent bankruptcy.

As one leading accreditor acknowledges, accreditation, and I’m quoting, “undeniably and unapologetically looks at inputs.”

For many accreditors, student outcomes are way down the priority list. The current system of continuous improvement is in desperate need of it’s own improvement.

We need to build a system in which student learning, graduation and going on to get good jobs count most. That’s what it means to focus on outcomes.

We as a Department must do a better job at holding accreditors responsible for their work. But we need Congress to take action and not tie our hands.

States, as well, must do business differently.

It is to their credit that states have come together at the K-12 level, adopting learning standards aligned to success in college – an enormous effort by educators and politically-courageous leaders that will pay off hugely for students over time. In the past, far too many students have arrived in college needing remediation; higher and better aligned standards will help to change that.

But the widespread cutbacks that states have made in their higher education budgets desperately need to be reversed. In all, 47 states cut per-student spending between 2009 and 2014, by an average of about 13 percent.

Over the past 25 years, state per-student spending is down 25 percent, after adjusting for inflation! For each dollar states put in higher education today, the federal government invests more than two.

This pattern of state disinvestment—and the expectation that the federal government will cover the shortfall—has to end. States, as well as Washington, need to remember that higher education is a public good. States like Alaska, Illinois, and North Dakota have done just that -- they increased funding for higher education, even as the economy faltered.

I’m, however, that a number of colleges and universities have stepped up themselves to find new ways to expand opportunity, and hold themselves accountable for serving more of today’s students better.

Building on efforts in places like Tennessee and Chicago, leaders in Oregon, in Harper College in Illinois, and Philadelphia are already helping to realize the President’s vision to provide two years of college to responsible students at no cost.

Right here at UMBC, under President Hrabowski’s extraordinary leadership, more African-American bachelor’s degree recipients go on to earn PhDs in the STEM fields than from any predominantly white university.

UMBC’s Meyerhoff Scholars Program has pioneered a comprehensive approach to recruiting and supporting minority students. So far, over 900 students have graduated, and 600 have gone on to earn advanced degrees. These scholars are five times as likely as similar students to have graduated from, or still be enrolled in, a STEM doctoral program.

The ASAP program at the City University of New York requires students to attend full-time and enroll in linked block courses. It’s also providing targeted advising and financial supports, MetroCards to make sure students can get to school, and free textbooks. The completion rate there was nearly double the rate for students who didn’t participate.

To me, so much of the promise for higher education lies in ideas just like that – and the genius and creativity of forward-looking educators like those that will be on our panel a little bit later. These leaders understand and celebrate higher education as a public good. But they are not stopping with that recognition. Against the odds, they are leading a quiet revolution that must succeed if we are to realize higher education success for millions and millions of additional students.

The old-school traditional higher education model that held place and time constant—students went to classes and the time needed to complete a class or degree was fixed. What varied was learning and completion.

In the future, I believe postsecondary educations will flip that, being far more flexible about both time and place and ways of learning, and awarding credit for competencies gained. Increasingly, they will enable students to customize their post-secondary education in different times and places over their entire lifetimes, accumulating credentials that educators call “portable and stackable.”

To state the obvious, I don’t see a future where any postsecondary option--including residential, liberal arts colleges--disappears. Instead, the aim should be to create more postsecondary options that do a better job of meeting everyone’s needs.

The liberal arts must remain strong. Our nation needs campuses where professors aspire to become top-flight teachers and leading researchers look for the next big discovery to help humanity – whether that’s a cure for cancer, the next amazing technology or breakthrough ideas.

But too many liberal arts colleges and research universities have built their brands on exclusivity for far too long. It's time to bring to an end to the false choice between excellence and access.

Excellence plus equity is a powerful win-win. Just look at research institutions like Arizona State University, and selective liberal arts colleges like Vassar, and Franklin and Marshall. ASU awards about 60 percent more degrees today than it did a decade ago, while the number of African-American and Hispanic students at ASU has doubled during the same time period.

Franklin and Marshall has doubled its enrollment of low-income and first-generation students without any dip in graduation rates. At Vassar, the percentage of students eligible for a Pell grant rose 11 percentage points in recent years.

Southern New Hampshire University, the University of Wisconsin, and others have demonstrated that flexible, competency-based programs make it possible for employed moms, returning vets, and displaced workers to have access to innovative programs at low and reasonable costs.

We’re proud to support a broad range of innovation efforts through our First in the World fund, which fosters innovations that drive down the cost of college. I hope Congress will reject Republican plans to zero out its funding and continue to invest in this initiative to produce evidence of what works.

My three broad themes today will guide our approach to reauthorization of the Higher Education Act, as they guided our work from the very beginning. First, we will be seeking to make college more affordable, financial aid more accessible, and loan repayment easier. Second, we will concentrate on boosting student success through shared responsibility and accountability for outcomes. And third, we will promote innovation and competition through transparency and evidence of what works.

We will look to provide incentives for states, postsecondary institutions, and students themselves to work to improve outcomes, enabling millions more students to graduate in a timely manner with a quality degree and land a good job.

We will work with states, colleges, and accreditors in a shared partnership, with clear responsibilities, to increase accountability for student success in higher education.

We will strive to reward success, especially where universities are demonstrating their commitment to better serving disadvantaged students.

And we will work to protect taxpayers and students from those who seek to take advantage of them.

The challenge before us is enormous, as are the stakes. But I’m very, very hopeful. I take heart from both the genius of visionaries like those gathered in this room and around the Nation.

I believe that with your leadership, and with collective courage and commitment, our nation will advance the work of perfecting the promise of higher education.

This is not just an economic imperative; it’s a moral necessity. Ensuring the opportunity of college success for all students who are willing to work hard is a core tenet of the American covenant.

As President Obama told the NAACP earlier this month, “Justice is not only the absence of oppression; it is the presence of opportunity.”

The decisions we face here will define our generation. In the choices we make, we will decide what kind of country we are, and who gets to share in the nation’s success. Because of your leadership, I am convinced we have a better chance at getting this right.

Thank you so much, and let’s start our conversation.