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There will be another recession.
That matters for all of the human reasons that recessions matter -- people losing jobs, losing homes, living under a gnawing fear that ages them quickly. But it also matters for higher ed policy.
Wednesday’s piece about the different permutations of “free community college” in various states, including my own, noted that several of the proposals were able to gain political traction by making the criteria so narrow that very few students actually qualified. That keeps the cost down. During relatively flush times, when tax revenues are up and community college enrollments are down, it’s easier than usual to push for some version of free community college. Versions that don’t cost much are easy to fold into large budgets when revenues are strong.
But a recession will come. I don’t know exactly when, but it will. They always do. And if history is any guide, the next recession will reduce tax revenues to states, while simultaneously increasing enrollments at community colleges. In other words, it will put severe economic and political pressure on free community college programs. They will become much more expensive at exactly the moment when it will be harder to cover the cost. I wouldn’t be surprised to see many of them either shrink or fade away entirely if they remain in their current form.
The time to fix the roof is when the sun is shining. The time to recession-proof a social program is when the economy is strong and tax revenues are healthy. Advocates of free community college should be taking pains now to ensure that the programs aren’t eviscerated the next time the economy has to catch its breath. Because it will.
One way to do that is to move much of the funding stream from the states and counties to the Feds. That would help because the Feds can deficit-spend; most states and counties can’t. That means that the Feds can, if they choose, deliver a Keynesian counter-cyclical spending boost when things go bad. Education is a great vehicle for that, in part because it puts people in better positions to thrive during the subsequent recovery.
The catch, obviously, is that the Federal government isn’t necessarily any wiser than the states. And political winds shift, so a sympathetic administration can easily be followed by a hostile one.
The Feds already supply some counter-cyclical boost through Pell grants and subsidized loans. But they tend not to do operating aid, so the only way for colleges to capture more of the Pell and loan money is to raise tuition. During recessions, that’s politically toxic, and it sends exactly the wrong message.
American political culture is deeply skeptical of anything it perceives as a handout, but it’s much more accepting of what it perceives as an earned benefit. If free community college (or whatever variation on it) can be structured to come across as an earned benefit, it’s much likelier to survive the next recession, regardless of who is in office. For proof, just compare the political vulnerability of “welfare” to the invincibility of Social Security. They’re both transfer payments, but the latter is perceived, rightly or wrongly, as earned. That makes it much harder to take away.
Community service requirements are one possible way to do that, as Tennessee has done.
If that’s not enough, or if the oversight bureaucracy is too much, there’s also the option of doing what Marion Tech did in Ohio, and making the second year free, contingent on a good GPA in the first year. In that model, “skin in the game” isn’t in the form of debt or money; it’s in the form of demonstrated academic performance. Students have to earn the benefit. Try taking it away from students who have earned it fair and square, and prepare for serious blowback.
I’ll admit some bias on that one, but I like it a lot. It sends the right message to students about persistence, it rewards desired behavior, and it allocates scarce resources towards increased retention and graduation. It even leaves room in the first year for private philanthropy, or dual enrollment credits.
Whatever the method, though, if we rely on the kindness of enlightened legislators during economic expansions when enrollments are low, we’re in for a rude surprise when the next recession hits. This is the time to fix the roof.
