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Should Jeremy Corbyn learn from Hillary Clinton’s education plan?

Student debt is as American as apple pie. But the system is in crisis, which is why Democratic presidential nominee Hillary Clinton is proposing to scrap university tuition fees.

Dee Searle
16 August 2016
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UK students protest against university tuition fees. Photo: Johnny Green/Press Association. All rights reserved

“In a highly competitive global economy, we need the best-educated workforce in the world. It is insane and counter-productive to the best interests of our country and our future, that hundreds of thousands of bright young people cannot afford to go to college, and that millions of others leave [university] with a mountain of debt that burdens them for decades. That short-sighted path to the future must end.”

Precisely! Unfortunately these are not the words of UK Prime Minister Theresa May or even Labour leader Jeremy Corbyn (whose 10-point manifesto promises a national education service open to all but does not mention universities). They were the introduction to the pledge by US Senator Bernie Sanders to make higher education tuition debt-free, as part of his bid for the Democratic presidential nomination. Sanders demonstrated the importance of the issue by making it number two in his list of more than 30 priorities  (after income and wealth inequality).

Sanders was eventually beaten by Hillary Clinton after a hard-fought competition to be the Democratic presidential nominee, which has left the US Democratic Party divided, with substantial numbers of members and supporters vowing not to vote for her. This is unwelcome news going into what promises to be a vicious Presidential campaign against the Republicans’ populist, right-wing nominee Donald Trump.

In an attempt to win over former Sanders allies, Clinton has promised to end four-year degree course tuition fees at public colleges and universities throughout the United States, initially for all students from families with an annual income of US$85,000 or less, rising to earnings of US$125,000 or less by 2021. This does not include most of the United States’ highest-ranking universities such as Harvard, Yale, Stanford, Princeton and Columbia, which are private and mostly backed by charitable foundations offering their own range of scholarships and bursaries to poorer students.

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Hillary Clinton pledges to introduce free public tuition at state universities. Photo: Hillary Clinton campaign.com

To be fair to Clinton, she had included a promise to tackle student debt in her original campaign platform. But the Sanders-inspired package goes much further including, in addition to debt-free tuition, free tuition at all community colleges (the equivalent of UK further education), a US$25 billion fund to support colleges and universities serving historically black, minority ethnic and Hispanic communities, refinancing for existing loans at current, low interest rates, and a promise to crack down on predatory schools, lenders, and bill collectors.

It is not clear whether Clinton’s education pledges will be sufficient to prevent some Sanders supporters abstaining from voting or even moving over to the Green Party, which more closely reflects many of Sanders’ policies than Clinton’s. In early August, the party’s 2016 Annual National Meeting elected Jill Stein, a Massachusetts-based physician, as its presidential nominee. According to media reports, the meeting included recruits from the left of the Democratic Party.

The Greens, who privately dismiss the Clinton/Sanders education pledges as lacking ambition, have a strong commitment to “lifelong public education that is entirely funded through public funds to enable people to lead meaningful and productive lives”. Stein’s Presidential manifesto highlights “Education as a Right” and contains radical pledges such as guaranteeing “a tuition-free, world-class public education from pre-school through university” to abolishing student debt, restoring arts, music and recreation to school curriculums and recognising that “poverty as the key obstacle to learning. Ensure that kids come to school ready to learn: healthy, nourished, secure and free from violence.”

The official rationale behind Clinton’s education pledge is a combination of the need to boost economic growth and to tackle the US’s student debt mountain, in which roughly 43 million people owe more than US$1.3 trillion in student loans,

Many are struggling to pay the money back and more than 7 million borrowers are defaulting. This, in turn, is deterring many students from lower and middle income households - the desired ‘middle class’ US voter) - from going to university.

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US student debt protest.

According to Clinton’s website: “Too many families in the United States are struggling with student debt, and the problem has reached crisis levels. Student debt has surpassed credit card debt, car loan debt, and home equity lines of credit to be the second largest source of consumer debt. And this is not just an issue for borrowers: It is holding our economy back. This debt prevents people from forming families, buying homes, and starting small businesses. It sends the wrong signal to future students whom we need to complete college to drive economic growth.”

Tuition costs in the US have risen 40 per cent, after inflation, in the last ten years at degree-awarding public colleges and universities, while family incomes have remained basically flat.  Meanwhile states have been cutting their spending on higher education – by roughly 20 per cent per student since the recession. While the Clinton pledge is welcome, several commentators have questioned how it would work, given that public universities charge a wide range of fees from around US$4,000 a year to over US$18,000, plus it’s not clear how it would be paid for. Sanders proposed a tax on “Wall Street speculators” but Clinton is wary of confronting the US allergy to increased taxation.

The lesson from the US is not just that student debt is unsustainable and risks destabilising the economy, but that the private finance model is broken. Clinton has recognised that higher education, like healthcare, is a public good that needs to be available to all because it brings wider benefits than can be assessed by simple cost-benefit analysis based on graduates earning more than non-graduates and therefore being able to repay their debt.

This is a radical and welcome challenge to 21st century conventional wisdom. In the 2015 UK General Election, only the Green Party pledged to axe university tuition fees. In fact, the present UK Government seems bent on increasing student debt through its May 2016 higher education White Paper “Success as a Knowledge Economy: Teaching Excellence, Social Mobility and Student Choice”, which allows universities to raise annual tuition fees above the current £9,000 cap, subject to meeting defined teaching quality standards. Department for Education officials have indicated in private briefings that Theresa May supports the proposals and there is likely to be a Bill before Parliament in the autumn.

This is in the face of DfE figures showing that the number of state school pupils going on to higher education dropped in 2013/14, the year tuition fees trebled. Even the executive summary to the White Paper admitted in that “young people from the most disadvantaged backgrounds are 2.4 times less likely to go into higher education than the most advantaged.”

Research by a number of education think-tanks and charities supports the conclusion that high tuition fees deter students from poorer backgrounds from going to university. These include the Higher Education Policy Institute, which found that numbers of part-time students dropped by 41 per cent between 2010 and 2015, and the Higher Education Statistics Agency (HESA), which identified a fall in university applicants from lower-income neighbourhoods.

HESA also discovered that poorer students are narrowing their options by tending to avoid purely academic degrees in favour of more vocational subjects that are likely to increase graduates’ employability and enable them to repay their student debt. This trend is evident among students at the IF Project, which provides free university-level courses in arts and humanities subjects for young people who might otherwise miss out. 

Successive UK governments of all political persuasions have justified increased fees by claiming that graduates are likely to earn more than non-graduates, and therefore be able to repay their debt. In 2013, a Department for Business, Innovation and Skills report, “The Impact of University Degrees on the Lifecycle of Earnings: some further analysis”, claimed that female graduates would earn an extra £252,000 over their lifetime and male graduates would earn £168,000. However, the justification was challenged earlier this month in a paper by the Intergenerational Foundation which found that, apart from Oxbridge, medical and dentistry graduates, there is no guaranteed graduate earnings premium for the many young people entering higher education. The premium depends on a wide range of factors, including pre-university education, socio-economic background, gender, ethnicity, subject choice, degree result, work experience and conditions in the employment market.

This prompts consideration of a less well-stated reason for the dramatic reversal of the US’s dearly held “consumer pays” principle of higher education: the country’s growing inequality and faltering social mobility. According to Stanford University, inequality in the US has increased across 20 different measurements, including income, chief executive pay and segregation between rich and poor neighbourhoods, “only college graduates have experienced growth in median weekly earnings since 1979 (in real terms). High school dropouts have, by contrast, seen their real median weekly earnings decline by about 22 per cent.”

Meanwhile studies by prominent institutions such as the Pew Charitable Trusts, have found that “vertical intergenerational mobility” is lower in the US than in comparable countries. In other words, many US citizens are likely to be worse off than their parents. This is mirrored by numerous studies in the UK, including by Bristol University, the Equality Trust and the Government’s own Social Mobility Index, which conclude that social mobility in the UK is less than in most other western European countries.

The impact of this social fracturing in the US has been displayed across TV screens around the world in the form of shootings, demonstrations and riots. It is therefore wholly reasonable that progressive Presidential candidates should see increasing access to education as one way of beginning to heal the divisions.

On the other hand it seems unreasonable (or frankly bizarre) that in the UK, shortly after the fifth anniversary of the 2011 riots and the shock referendum vote to leave the EU, which many attributed at least in part to growing divisions in British society, the Government seems determined to deter young people from poorer backgrounds from studying at university. Successive British governments have attempted to introduce more US-style practices into the UK, from privatisation of healthcare provision to workplace deregulation. The (re)introduction of a Clinton-inspired Bevanite free national education service would actually make sense.

Read more articles in our series: Voices for Change

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