Innovation is Key to Answering the Trillion Dollar Student Loan Question
The U.S. government’s debt for unpaid student loans has exceeded $1 trillion with no relief in sight. While Congress recently passed a bill that ties interest rates for student loans to the Treasury’s 10-year borrowing rate, the cost to taxpayers is likely to grow as well. Meanwhile, this added financial burden has not yielded positive results, as the number of Americans with some college experience but no degree continues to increase every year. As a leader of a public university, I believe it is incumbent upon the university I lead, and on higher education as a whole, to find innovative solutions to the growing gap between the two variables of degree cost and completion.
From a simplistic perspective, if more people complete their degrees, more loan repayments are likely to be made and the higher the likelihood the trillion-dollar loan debt could reverse course. Conversely, national data reflects that people who don’t complete their degrees are less likely to secure higher wages, making it more difficult to repay their loans and forcing the loan debt to continue its steady climb.
My institution currently serves nearly 9,000 active students and adds new students every month. We offer bachelor’s degrees and master’s degrees at a low cost with fixed tuition, and we do not charge student fees. Despite our efforts, we are still finding that 12 to 18 percent of all potential new undergraduate students do not have enough federal financial aid to cover the credits needed to graduate. The percentage recently hit 18 percent, which is in alignment with the growth in non-traditional student enrollment for 2008-09; students who are now nearing degree completion and finding they have reached their lifetime aggregate loan limits. So what are we, as a nation, or even as a single institution, going to do to address the challenge?
If, by definition, ‘innovation’ incorporates all of the possibilities that might exist towards solutions, it seems logical we should look at recent innovations in higher education to address the gap. Online courses, MOOCs (Massive Open Online Courses), credits by exam, prior learning assessment and competency-based learning are all relatively low-cost alternatives to traditional higher education. These options could be mixed and matched to provide a degree based on proven learning and ability. As an example, no-cost MOOCs paired with a for-credit assessment could be an ideal way for students to earn inexpensive credits, particularly for lower-level bachelor degree course requirements. For self-directed learners, the opportunity to access MOOCs from around the world to acquire much of the 120 credits needed to graduate could allow for an engaging and global education balanced with the need to verify learning achievements through assessments.
At Colorado State University (CSU)-Global, we have incorporated credit alternatives into our bachelor’s degree completion programs and have also recently tested the MOOC and assessment models. We found a high interest in MOOC courses but little interest in the assessment for credit. Public discourse has presented a variety of explanations for this behavior, but whatever the reasons, the outcome is that we have had little interest in the exams. Our initial MOOC offering has also taught us students from around the world require the same level of university support in an open environment as they would in one of our standard online classes to be successful — an expensive test for what was a no-cost student offering.
I have been asked if our MOOC tests are considered to be failures and my response is unequivocally “No.” It is a utopian concept that could help provide a lower cost of education in the future and minimize the need for student loans. It seems reasonable that MOOCs, backed by large private equity and major nonprofit investments, will find their place in higher education over time. As CSU-Global gears up for its next MOOC offering in Fall 2013, we will continue to learn alongside our students as we work to identify how innovation can help solve the trillion dollar-plus challenge facing higher education today.
Author Perspective: Administrator