24 Jun

College graduates owe a debt — literally


We’ve just completed graduation weekend for Oregon’s state universities, producing lots of parties, a boom in robe rentals and one powerful meaning for the state’s economy:

Thousands more Oregonians are now beginning to have their student loans come due.

We’re giving a whole new meaning to the phrase “college credit.”

Student debt in America now tops $1.2 trillion, more than credit card debt or car loans, an amount that hangs around graduates’ necks like the hoods showing what they studied. The trillion-plus is an anchor weighing down the entire country, at a time when we’re counting on recent graduates to buy cars and houses and otherwise inject life into the economy. For that reason, it’s dangerous for the debt level to continue to swell, but it’s growing a lot faster than the investment in Pell Grants, the federal scholarship grant program.

Last week, President Obama increased the (limited) percentage of Americans owing student loans who qualify for a program that caps their payments at 10 percent of discretionary income, and forgives whatever’s left after 20 years – or just about when the student debtors may have to start worrying about sending their kids to college. Wisconsin Republican Rep. Thomas Petri has a proposal for student loan debtors to pay 3 percent of their income, something like Oregon’s “Pay it Forward” proposal, except this being Congress nobody is expecting anything to go anywhere – except for Petri himself, who’s leaving at the end of this year.

Oregon has a particular interest in something happening. According to the Project on Student Debt, among Oregonians graduating in 2012 – the most recent numbers available – 60 percent carried a graduation present of student debt, an average of $26,639, or 22ndin the country.

At least we’re above average in one higher education statistic.

Coming out of last year’s legislative session, state Sen. Mark Hass, D-Beaverton, brought a mandate to try to make a dent in Oregon’s debt pile by slowing how fast it piles up – by covering the tuition cost of two years of community college.

“It’s what originally drove me,” said Hass about the debt problem. If students can postpone accumulating big college debt for two years, the total landing on the shoulders of graduation robes could be a lot lighter.

Besides,“You can’t do much with just a high school degree.”

Already, some players are trying to help navigate the narrow straits between diploma and debt. High schools emphasize dual credits that also count for college, and a handful of them, reports Hass, allow students to stay for five years – picking up college credits while the district still draws the state’s K-12 student payments for them.

If you think the role of high schools is to help students succeed in life, it makes some sense.

But Hass has another strategy. The core of it is to draw more Pell Grant money for Oregon students, which he’s certain can be done: “We’re leaving federal money on the table.”

But, according to University of Wisconsin professor of educational policy and sociology Sara Goldrick-Rab, who’s been consulting with several states on the idea, the plan would also involve moving some federal scholarship money around. The state would seek a waiver to redirect money to community college students who otherwise might not be going to college at all.

“You’re going to do triage, like you’re in an emergency room,” argues Goldrick-Rab.

The proposal would likely stir resistance from private colleges and universities, as well as Oregon’s public universities, these days overwhelmingly funded by tuition revenue. Like every other idea for strengthening both the quality and the number of graduates produced by Oregon colleges, it would likely require some significant state reinvestment in the Oregon higher education system.

But what Hass and Goldrick-Rab – and pretty much everyone else who’s looked at the situation – agree on is that Oregonians who don’t acquire any post-secondary education are likely to cost the state money in the long run. The state pays for high school on the grounds that its students require it to function; that reality may now have extended from 12 to at least 14 years of education.

And the benefits could extend to graduates of the universities as well. With two years of subsidized community college, points out Goldrick-Rab, “The transfers won’t be racking up the same amount of debt they are now.”

As last weekend demonstrated yet again, something has to make that happen.
Graduation weekends would be a lot more celebratory if it didn’t feel like graduates were moving from university to debtor’s prison.

NOTE: This column appeared in The Oregonian, Wed., June 18, 2014.

24 Jun

American gridlock is literal


There are so many things to look forward to in summer: Going off on family vacations, lazy drives in the country, rolling over cooling rivers on structurally sound bridges.

And this summer, we can look forward to the National Highway Trust Fund running out, which could do more to keep Americans motionless than the mosquito.

For years, Oregon Rep. Peter DeFazio has been working to devise a new federal transportation bill, legislation that Congress used to pass regularly every six years, with roads and bridges for all. As a very senior member of the House Transportation and Infrastructure Committee, DeFazio could have a significant voice in shaping the bill; last time, he was able to adjust the funding formula to Oregon’s benefit.

But what’s the point in being a transportation honcho in a Congress that’s going nowhere?

“America’s falling apart,” DeFazio said in a recent interview. “There’s not even enough money to maintain what we built in the last century, let alone any new major projects. At all levels, it’s pathetic.”

The National Highway Trust Fund, which covers most federal transportation efforts, is funded by the federal gas tax, which has not been increased since 1993. What has increased sharply is average gas mileage, not to mention hybrid and electric cars, meaning that the feds are collecting steadily less per mile travelled, although it certainly doesn’t cost less to maintain a mile of road.

And this summer, we’re heading down a particularly steep off-ramp. The multiyear transportation act runs out Sept. 30, but before we even get to that point, the highway trust fund runs out of money sometime in August. We’re approaching the toll booth, and grubbing under our seats for coins.

Without some kind of deal — and Congress goes on its July 4 recess on Friday, to be followed shortly by its August recess, and the House has just 30 workdays left before the Sept. 30 deadline — projects dry up swiftly. In Oregon, Oregon Department of Transportation director Matthew Garrett warned DeFazio, federal transportation funding would drop by 40 percent, and “If Congress has not resolved funding for all of 2015 by early this fall, we will have to delay sending some projects to bid and contract.”

If we’re depending on Congress to act effectively, of course, we might as well immediately adjust our shock absorbers to Pothole – and be careful about crossing any bridges.

House Republicans devised a plan to temporarily cover the shortfall by ending Saturday mail delivery, which DeFazio noted would “maintain our very anemic and inadequate funding for six months by sacrificing the Postal Service.”

Although as he noted Thursday, referring to the House majority leader recently decapitated in a Virginia primary, “Eric Cantor was the one who was pushing the idea of taking money from the Postal Service. We haven’t heard much about that lately.”

And as Transportation Secretary Anthony Foxx pointed out, “I would point out that on its best day, the proposal that’s being offered on this postal service is a one-year proposal, and so it doesn’t meet the demands of a long-term investment.”

Of course, the administration’s own proposal calls for funding by corporate tax reform, which would be passed by this Congress just about the time personal flying devices make a transportation package unnecessary.

Last week, DeFazio introduced a bill for a barrel tax on oil destined for transportation. Sens. Chris Murphy, D-Conn., and Bob Corker, R-Tenn., proposed a gradual 12-cent-a-gallon gas tax increase. Neither plan has yet attracted a crowd.

Oregon Sen. Ron Wyden, chairman of the Senate Finance Committee, said last week that he wanted his committee to devise a short-term six-month fix followed by a long-term solution, although he didn’t know what it might look like. Wyden spokesman Kevin Chu said Thursday that Wyden would look at all possibilities, and wanted to get a short-term fix through the Finance Committee before Congress left this Friday.

That’s as encouraging as things get for 50 state transportation directors, including Oregon’s Matthew Garrett. A federal role in transportation that goes back to the interstate highway system set up in the 1950s – not to say the intercontinental railroad system of the 1860s – seems on the edge of rolling into a roadside ditch.

For seven years, we thought the motionless traffic of the Interstate Bridge at rush hour was on its way into the past. Now it seems likely to spread through then future.

It’s not enough that Congress has paralyzed itself in gridlock.

It’s now extending that benefit to the rest of us.

NOTE: This column appeared in the Sunday Oregonian, June 22, 2014.