If the higher education bubble is bound to burst, those who benefit from current arrangements would like to delay that pop for as long as possible. Here’s an interesting article on the topic from the latest issue of Bloomberg Businessweek.
For the past nine years, graduate students in the U.S. have had almost a blank check to take out as much as $80,000 a year in government-backed loans to pay for tuition and living expenses. Republican Senator Lamar Alexander of Tennessee thinks that’s too much. He’s introduced legislation, backed by his Democratic colleagues Michael Bennet of Colorado and Cory Booker of New Jersey, to limit borrowing to $30,000 a year, with a cap of $150,000. Programs with especially high costs could appeal to the U.S. Department of Education to let their students borrow up to $15,000 more each year.
Colleges, whose lobbyists and trade associations have succeeded in defeating just about every attempt to control rising tuition costs over the last decade, are trying to soften Alexander’s proposed law, which would also radically simplify the federal student aid application. “I don’t think that bill will be enacted as is,” says Carolyn Henrich, a lobbyist working for the University of California system in Washington. Henrich, who formerly lobbied for the National Parent Teacher Association, says she’s met with Alexander’s staff to register the university’s opposition to the loan limits.
Cornell University doesn’t like the Alexander loan limits either. Neither does the Association of Jesuit Colleges & Universities, which includes Boston College, Fordham, and Georgetown. Harvard, Northwestern, and Vanderbilt have indicated in filings that they’ve lobbied on the Alexander bill, though they haven’t publicly taken a position for or against the loan limits. “We believe in a strong federal aid system that benefits all students and also serves the needs of graduate and professional students,” says Harvard spokeswoman Anna Cowenhoven.
The presence of university lobbying in Washington dates back at least to World War II, when the federal government began awarding large research grants. “The people running the government were graduates of the top schools, so they” wanted their own schools to get the grants, says Gerald Cassidy, a Washington lobbyist who represented dozens of colleges and universities over the years before he retired in December. In the 1970s and ’80s, many institutions brought their lobbying in-house, opening Washington offices. Nan Wells, who established Princeton’s D.C. lobbying office in 1979, says she focused on research funding, student aid, and maintaining tax exemptions for donors. “One of the nice things about the job,” she says, is that “the issues were the same every year.”
Thomas Weko saw the influence of the college lobby as a staffer for the Government Accountability Office a decade ago. The Senate directed the GAO to study an antitrust exemption allowing almost 30 elite colleges to discuss policies for disbursing private scholarship money. Weko says college lobbyists participated—unannounced—in a call that he held with Senate staff about designing the GAO study. “You felt them pulling the strings as you participated in meetings with Senate staff,” says Weko, now a managing researcher at the American Institutes for Research, a Washington-based nonprofit that evaluates social policies. An extension of the exemption sailed through Congress this summer.
