An A La Carte Degree: Conservative Think Tank Pushes For “Unbundled” Higher Education

Election 2016
Posted By Derek Johnson on October 19, 2015 at 2:27 pm
An A La Carte Degree: Conservative Think Tank Pushes For “Unbundled” Higher Education

With the prospect of major changes on the horizon for the higher education system, policy experts are hearing the knock of opportunity. Widespread acknowledgment that the current system is broken has created a space for big reform ideas on both the left and the right.

Presidential candidates like Hillary Clinton and Bernie Sanders are coalescing around “debt-free” or “tuition-free” college plans to address the problem. While Republican candidates are calling for deregulation among other more conservative, yet substantial, changes to the higher education system. Marco Rubio said during a speech in July, “We do not need timid tweaks to the old system; we need a holistic overhaul.”

To flesh out varying conservative positions on this issue, the American Enterprise Institute (AEI) recently released a white paper on “unbundling” higher education. Authors Andrew Kelly and Michael Horn argue that college is too expensive for many because most institutions spend tons of money on things that have nothing to do with your degree, like administrative overhead costs, state-of-the-art facilities and bloated personnel costs. As a result, the cost of tuition is more than just the price of the classes, professors and services that go towards a degree; it’s bundled together with all the programs, departments and staff necessary to run a massive multi-disciplinary institution.

Andrew Kelly, director of the AEI’s center on higher education reform and a co-author of the paper along with Michael Horn, said that the traditional bundled college model no longer makes sense for a large number of Americans, particularly those from low-income backgrounds. The Internet and other technologies have made it easier and cheaper than ever to offer valuable, specialized courses and training that directly apply to a student’s career goals.

“Tuition increases and lack of attention to cost containment is, I think, going to push more and more people into these alternative markets,” said Kelly.  “I think it’s going to send a signal to the traditional system that you can’t continue to do things like this.”

The “alternative markets” cited by Kelly include numerous vocational programs, certifications courses, “boot camp” style trainings and other types of microcredentials. These programs are modular, already exist in the marketplace and are far cheaper than a standard college degree. However, unless they are part of an established college or university, many do not meet the standard for accreditation and aren’t eligible to accept federal student aid.

Those standards, he argues, place too much focus on the structure and makeup of the institution and not enough on the value of the individual program or course. If a program provides you with the skills you need to land a job, the authors ask, why should it matter whether the provider looks or operates like a traditional college?  Why can’t a standalone online training program or a corporation offer classes or trainings that teach students the exact skills and knowledge necessary to get hired?

“It’s sort of jarring when you think about the interesting things going on outside the traditional system, many of [these programs] don’t look anything like traditional colleges,” said Kelly. “You really start to realize how inadequate the institution and the level of federal focus is when it comes to harnessing some of this new entrepreneurial activity.”

The idea, however, is not without potential drawbacks. Iris Palmer, a senior policy analyst on state higher education policy at New America, said there should be room in current federal policy for the kind of experimentation and innovation advocated by the authors. However, she questioned the end result of an “unbundled” world.

“It very well could turn into a two-tiered educational system, where people who are low-income and what the government will pay for is the most stripped down, vocational option, and only people who could afford it would then go on to do get a liberal arts degree,” said Palmer.

Kelly does not deny this possibility, admitting that the market for traditional college would likely remain largely intact for students from wealthier backgrounds. He even acknowledges that the kind of low-cost courses and programs he envisions being offered by corporations could lead to jobs that pay less than similar positions that require a standard college degree. He simply feels that for many low and middle-income students, the prospect of lower cost and no debt will be worth it.

“People are going to start to think about the experience they’re after in more sophisticated terms than what institution they want to go to,” said Kelly. “What I mean by that is, employers have to pay a wage that is high enough to convince someone to come work for them. People with big expensive degrees and higher debt require a higher wage.”

As long as U.S. policymakers view colleges and universities as the only legitimate pathway to higher learning, Kelly and Horn say that the price tag of the bundled college experience will continue to grow. Instead, they favor a gradual shift towards an a la carte higher education system, where students can pick and choose from a wide variety of classes, courses and programs that are relevant to their career choice at a much lower overall cost. Since many of these programs don’t have the personnel or property costs that plague most traditional schools, students could choose a handful of programs to customize their skills and dramatically reduce the need to borrow student loans.

Palmer believes that evidence that these types of non-credit programs lead to higher labor market outcomes is thin, that there are credential and certification programs funded through the Workforce Investment Act, and that students today already suffer paralysis by analysis when choosing their higher education experience.

“The world [the authors] are creating, this is an incredibly complex system. We already have 3,000 to 4,000 institutions,” said Palmer. “I think for everybody -particularly the disadvantaged – it becomes really hard to know and put something together that’s high quality. It’s this idea of the [Do It Yourself] degree, which maybe some high functioning people can do, but for everybody else, not so much.”

The authors acknowledge that higher education world may not be ready for an unbundled world right away. Simply allowing new third party organizations access to federal student aid funding “would invite waste, fraud and abuse” and the current accreditation system is not set up to properly assess the value of the kind of stand-alone courses and programs they are touting.

Because there is a lack of quality assurance data about many of these alternative programs, Kelly and Horn advocate waiting for the marketplace to separate the wheat from the chaff before lawmakers consider widespread changes.

“There’s lots of room for experimentation, certainly there’s room for experimentation with public money,” said Kelly. “We don’t think any of these ideas [alone] are a silver bullet, but they should be part of experimentation by policymakers before they go whole hog.”

Derek Johnson
Derek Johnson is a writer, journalist and editor based out of Virginia. He received a Master’s degree in Public Policy at George Mason University and a bachelor’s degree in Communication from Hofstra University.

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