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In Debt and No Degree? Today's College Students Need Help

October 08, 2012

While Congress is focused on the coming “fiscal cliff,” there is another emergency right on its heels that could have an even more drastic impact on our nation’s ability to compete if it remains unaddressed – and that is the spiraling cost of college and how we help students pay for it.

Our nation’s colleges and universities are under pressure like never before – to produce more graduates with fewer resources. Leaders of these institutions know that our economy needs more – many more – graduates to meet the demands of an increasingly knowledge-focused economy.  And if the status quo remains, we won’t even get close. At the same time, the Pell Grant system, which supports 9.4 million students, is approaching a fiscal cliff. Student debt loads are unsustainable. Too many students are stuck with debt and no degree. Left alone, these trends will collide and the social and economic implications for our nation will be nothing short of profound.

It is a story most of us are familiar with:

The high cost of college prevents many students from finishing

Financial aid is one key to reversing these trends - it needs to both help needy students access postsecondary opportunities and provide incentives to ensure they finish.

The situation has become dire and all options and perspectives are being put on the table for debate- David Longanecker, president of the Western Interstate Commission for Higher Education and a former Deputy Education Secretary, recently suggested that the federal government spends too much to help middle-income families more easily pay for college and not enough to get low-income students to college in the first place.

Further exacerbating the situation, Donna Shalala, president of the University of Miami and former Health and Human Services Secretary, observed that financial aid is designed for students who finish in four years, not for today’s students who are typically older, working through school and often have families of their own. Financial aid, she said, is “not organized for the kinds of students we have today.”

To help meet these challenges, we've asked 14 organizations to come up with policy recommendations for improving financial aid. There is much urgency and a lot to learn.

To foster a public conversation, the foundation recently hosted a candid and dynamic discussion during a Clinton Global Initiative (CGI) topic dinner in New York City with university presidents, system chancellors, business leaders, academics and activists challenging them to help reimagine college affordability and financial aid so that more students complete postsecondary degree programs. The next night, this topic was center stage at NBC’s Education Nation.

But this is just a start. The difficult conversations necessary to figure out how to solve this problem must be robust, inclusive and ongoing.

There are a number of complex and intertwined issues at play here. But there also is enormous potential. We believe that financial aid can open doors for students, and when done right, can also increase the likelihood that young adults complete their educations.

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