In 1961, President Eisenhower warned of the threat\u00a0posed by the military industrial complex\u2014the private industry that\u2019s cropped up around the U.S. armed forces. But since then, a new juggernaut has appeared that is holding young Americans financially hostage.\u00a0
Fueled by misguided government policies, the \u201cuniversity industrial complex\u201d is pushing a generation of college students into crippling debt. And, unfortunately, the\u00a0Biden\u2002administration is at best ignoring the real problem while at worst exacerbating it.
How big is the problem? Currently, student loan debt amounts to a whopping\u00a0$1.76 trillion\u00a0\u2014 a figure that has more than doubled since 2010. Fueled by college tuition rates that are rising much\u00a0quicker\u00a0than earnings, the financial liabilities are ballooning at a rate that\u2019s impossible for students to keep up with.\u00a0
And with a tidal wave of fresh graduations happening this month, many young people are set to be whacked with a financial gut punch.
The question is why is college so expensive? Has the quality of education provided by these institutions skyrocketed as costs go through the roof?\u00a0Far from it. Instead, colleges have shifted priorities.\u00a0
Universities are\u00a0building\u00a0resort-style amenities that offer students everything from saunas to waterslides. Curriculums are being expanded to include degree specializations that have limited financial benefit in the real world. And billions are invested into\u00a0armies\u00a0of highly paid administrators that provide little additional value. How did schools survive before having a\u00a0vice provost for equity and inclusion\u00a0that earns north of $400,000 a year on staff?
These\u00a0bloated costs have very real consequences \u2014 especially for students of color.\u00a0
According to an\u00a0analysis\u00a0from the Education Data Initiative, Black college graduates, on average, are saddled with $25,000 more in student loans than their white counterparts. Moreover, Black borrowers are the most likely to struggle financially when faced with monthly bills to pay off the debt.\u00a0
But rather than confronting the problem head on, the Biden administration is\u00a0seeking to sweep it under the rug\u00a0by forgiving\u00a0$400 billion in student loans via executive action.
The plan is nothing more than a temporary\u00a0band-aid that will\u00a0give colleges a blank check\u00a0to raise\u00a0tuition\u00a0even more. It signals to both university leaders and future students that more easy money is in the pipeline. And once the valve is open, young people can borrow thinking they won\u2019t have to pay it back \u2014 a dynamic that academia will take advantage of.
That\u2019s why my organization, the Job Creators Network Foundation,\u00a0took legal action against the Biden administration\u00a0to block the student loan bailout. And after arguing our case in front the Supreme Court in February, we\u2019re optimistic\u00a0the justices will rule in our favor and declare this loan forgiveness program illegal.
But ripping up Biden\u2019s blank check to universities is only one side of the equation. Now, conservatives need to offer solutions. And that starts with holding university leaders\u2019 feet to the fire.\u00a0
Through legislative hearings and investigations that are profiled in the court of public opinion, policymakers should put colleges on the defensive \u2014 pressuring them to justify\u00a0unsustainable tuition rate increases.\u00a0University leaders should also be held accountable for providing students with transparent, realistic expectations of what career or financial outcomes degree holders can expect following graduation.\u00a0
Additionally, government subsidies should be reined in. Rather than offering easy\u00a0money to any prospective student that walks in the door, government-backed loans and financial aid should be more targeted. While those from low-income families that have the academic credentials to thrive in college should be given the opportunity, universities should have some skin in the game too.
How? Colleges\u00a0could\u00a0underwrite\u00a0at least a portion of student loans. That way, the institutions hold a financial stake in the career success of their alumni.
The Biden administration\u2019s student loan bailout is seemingly on the rocks. But now, policymakers need to take the next step and hold colleges and universities accountable to help address the\u00a0student debt crisis.
Elaine Parker is the president of the Job Creators Network Foundation.
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