In August, the Biden administration announced its plan to relieve $10,000 in federal student loan debt for most borrowers and up to $20,000 for recipients of Pell Grants, alongside sweeping changes that include an income-driven repayment plan. The plan promises to relieve the debt load for millions of student borrowers and their families.
But larger problems in postsecondary education remain to be addressed, ones that won’t simply be erased with student debt relief, said Kelly McManus, director of higher education for Arnold Ventures, during a recent interview with Dan Loney at Wharton Business Daily on SiriusXM radio.
“We really are looking at a Band-Aid over a gaping wound,” McManus said. “It’s important for higher ed stakeholders, the general public, and especially for policymakers, both in Congress and in the White House, to use this as just a first step.”
The next step, according to McManus, must be reforming the higher education system more broadly. That should include providing greater data transparency about higher education, so that students and families can compare schools’ merits and make informed decisions. It should also include creating accountability measures for schools, so that they exercise a higher degree of responsibility to students — and so that predatory institutions can’t gobble up federal aid dollars. Finally, McManus said, we must incentivize schools for graduating students, rather than simply for enrolling them.
These changes will take legislative action. Lawmakers on both sides of the aisle are beginning to understand that students need protections, said McManus, whether through a new version of the expired Higher Education Act or through a new structure of laws.
“There’s common ground there. We can build a better structure where, when students take out their student loans, they can feel confident that they are going to be able to pay them back if they graduate.”
Listen to the full interview here: