Keep Student Loans Affordable Act of 2013—Motion to Proceedby Senator Marco Rubio
Posted on 2013-07-10
RUBIO. Mr. President, this issue is very important to millions of
Americans, and one with which I am too familiar. I think I have shared
this in the past, but I will share it again.
Obviously, my parents didn't make a lot of money. So I would not have gone to college, I would not have gone to law school had it not been for Federal financial aid, both in the form of Pell grants, loans, and work-study. All of these programs opened that door for me. In fact, I don't think any of my siblings could have gone to college without some assistance.
The point is that I know how important these programs are to Americans. In fact, when I was elected to the Senate in 2010, I still had a student loan that was over $100,000. I was fortunate to write a book--which is now available in paperback, if anyone is interested--and with the proceeds that I made from that, I was able to pay off that loan. Had it not been for that, I am not sure when I would have been able to pay off my student loan for law school.
[[Page S5596]] Early on, when I had multiple student loans from both undergrad and law school and the private loans I had to take out for the bar study, there were months where my student loan payments were higher than anything else I was paying. At its peak, it was about $1,400 a month. That is with a graduate and a law degree, and making what most people would consider a pretty good living. Even with that, it was a real load.
Obviously, that is at the high end of the spectrum, but even if you talk about the average loan debt in America today being around $25,000 or $26,000, the evidence is clear this is having an impact on graduates.
So you graduate from college, you have the student loan debt around your neck, and it actually prevents you from doing things like starting your life, buying a home. In some instances, if you fall behind on your payments, it starts to hurt your credit rating. The evidence continues to grow that a significant percentage of young Americans are facing a challenge that no Americans before us have faced with regard to this sort of student loan debt that hangs over their heads.
So, clearly, we have to figure out a permanent solution--not a 1-year solution but a long-term solution--on the issue of student loan rates. That is an important part of this debate, but here is what I think is missing from this debate; that is, an open acknowledgement that what we have today in higher education as it is currently structured is becoming increasingly and inexplicably unaffordable. And that is the part that isn't being discussed.
The fundamental problem isn't the loans. The fundamental problem is the tuition rates that continue to climb across this country. In fact, according to the Wall Street Journal today, institutions of higher education grew their revenue faster than inflation from 2005 to 2011. Of course, the spending also grew. How many other parts of our economy grew their revenue and their spending at a pace faster than inflation over the last decade? The evidence is that every time we increase the amount of student aid that is available in both Pell grants and in loan programs, that is just eaten up by higher tuition rates.
Now, as a former State legislator in Florida, that was a battle we had every year because the universities said they needed higher tuition in order to retain quality faculty, et cetera. To some extent, I imagine some of that is true. But at the end of the day, there comes a point--especially in our public institutions--where quality but also affordability have to meet. We cannot continue to price people out of higher education in this country because it is inextricably linked to our future well-being.
There are two fundamental problems that face our economy. No. 1 is we don't have an economy that is growing fast enough, producing the kind of middle-class jobs that allow people to have the kind of lifestyle all Americans want. The other problem is we have a skills gap in America where a growing number of people simply have not acquired the skills they need for 21st-century middle-class jobs. The only way to close that skills gap is through education--and particularly higher education.
What I would argue today is that the model of higher education we have in place today, largely based on 19th- and 20th-century models, is broken. It no longer lives up to the reality of the 21st century.
For example, many of the higher paying jobs in the middle class today don't require a 4-year degree from a liberal arts college. They require less than 2 years or a 2-year degree program that you could get at a community college.
There are other things available to us in terms of how we can incentivize or reform our higher education programs. We should look at accreditation reform.
Right now, in order to get student loans or aid from the Federal Government, you have to go to an institution that is accredited. Traditionally, these are the 4-year or 2-year institutions. But there are now alternatives available to us, things that we weren't doing a few years ago.
No. 1, we should rely on community colleges, which, by the way, are a treasure in this country. The services that community colleges provide students to get 2-year degrees--in fact, some community colleges are in the 4-year degree program, and they have tailored programs that allow people to go to school while they continue to work. That is an important part of the backbone.
It is also an extraordinary part of retraining people. You might have a job, and all of a sudden that job doesn't exist anymore, and you have to get retrained in a new skill or a new trade. Community colleges are an important part of that component.
It goes beyond that though. Career and technical education, for the life of me, I do not understand why we have stigmatized that in this country; why we have created this idea that unless you get a 4-year degree or more that you are somehow not successful when we know we have a shortage of people we need to be trained in the skills and trades we once used to do in this country. We should get back to some of that. We should encourage that, quite frankly, even before the college level.
Why can't we graduate kids from high school with an industry certification and a career in a trade, so when they graduate high school they get a diploma and they are industry certified to go to work? We have an example of that on a smaller scale in south Florida, where a friend of mine actually takes high school kids and begins to train them as BMW technicians. They go to school in the morning for a couple of hours. Then they go to the shop and get trained. When they graduate from high school, they are BMW-certified technicians. Within a year after that, they can get even higher levels of accreditation, and some of them start making $35,000, $40,000 a year out of high school.
Why aren't we doing more of that? Instead, we leave kids trapped. They feel as though they are studying things they don't like and don't speak to them. They drop out of high school. They languish in the economy for 10 or 15 years, and then sometimes they will find themselves in a for-profit college or some other program to try to get trained.
Let's avoid all of that. Let's allow these high school students and others across this country with an opportunity to study something they enjoy and they love and to get the needed skills so they can avoid all of that.
We also have this new revolution in massive online coursework. Now, not every course can be taken that way, but we now have the ability to allow people to actually have self-directed learning, to use the Internet platforms that are available so they can take a course in political science from Harvard and economics from Yale. You can sit there and actually put your own course work together. This is still being developed, but this is an important part of our future innovation--the ability to bring the in-classroom learning to the student, not just require them to sit there for lectures for an hour and a half in a classroom when they can easily get it online and it can be tailored to their work schedule, to their workload, to their needs.
Beyond that, innovations, in terms of giving people credit for work experience or life experience--we see that colleges are doing that now where you can go in and say: This is what I have done for the last 20 years of my life, and you get credit for that work because you have life experience and work experience in a field. They don't make you sit there and spend a bunch of money on electives you are never going to use and don't really need because they want you to be ``well rounded'' but all it does, in fact, is drive up the cost of your education.
I don't know about you, but in the last 4 years of my degree I was searching for electives to take because I had to have electives. I don't remember what some of those electives were, but I paid for them with student loans and Pell grants. I would much rather have gotten my degree in the things I needed to know so I could have moved on to law school and done that there.
These are some of the ideas we have in terms of how we should revolutionize our higher education system to reflect the needs and the realities of the 21st century. The fact is that we now have a challenge before us unlike anything we have ever had. Industries are now evolving on a yearly basis. Most Americans are going to have to [[Page S5597]] be retrained at some point in their lives on a new skill because that is the pace of change, and we need to have infrastructure in place to provide that for people in a way that is affordable.
It reminds me of a story of a friend I had who was one of the parents on one of my son's teams, and the mom was always struggling. She was always the first one to get laid off at her office. She worked primarily as a receptionist at a dental clinic or medical clinic, got a little bit into billing. What she really needs to become and would like to become is an ultrasound technician so she can make a little bit more money, have a little job security, and provide her kids with the opportunities she wants them to have. The problem she has is that she has to work 8 hours a day. How is she going to do that and go to school and get that training? In many parts of this country we do not have the infrastructure in place for that to happen and the financial aid programs both on the loan side and Pell grant side do not provide the flexibility to allow them to do it in the most cost-effective way. To that end I have proposed a number of pieces of legislation. Most of them are bipartisan. I have worked with Senator Wyden and others on the Student Right to Know Before You Go Act. That basically means that before you take out these loans, you are going to be provided meaningful information: This is how much it is going to cost to go to school here, this is how much people who graduate with this degree from this college make when they graduate, and this is how much you are going to owe. You can still take the course, you can still major in that, but you deserve to know. You deserve to know that if you are going to owe $20,000 and you are only going to make $20,000 a year when you graduate with this degree, it will take you a long time to pay it, if ever.
Students have a right to know before they go. That is the Student Right to Know Before You Go Act.
I also offered the Higher Education and Skills Obtainment Act, which will create one universal tax credit for higher education, and it will produce measurable savings, some of which can be redirected to the shortfalls in the Pell Grant Program that are coming up. The bill offers one tax credit for students who are most in need, giving students the ability to avoid navigating a confusing maze of temporary tax provisions worth different amounts for different income thresholds.
By the way, people involved in job skill training would also have access to this universal credit as opposed to all these different credits floating out there now that people do not fully understand how to use.
There are other ideas I have proposed. I have introduced legislation with Senator Coons that provides an innovative partnership that will create an interactive source of information for students to be able to create college savings accounts. Studies have shown that American children with college savings accounts in their name are seven times more likely to go to college than students without one. This bill will combine innovative student support tools with savings accounts to promote access for low-income students in our country so they put some money aside to be able to do this.
The fact is that today's 21st-century student requires a higher education system that best suits their needs, whether it is in the form of a traditional university, a community college, a career or technical education, workforce retraining programs, or a combination of all of these.
I am not saying this is not an important debate to have because it is. It is facing people right now. But I hope at some point we will look at our student aid programs and what we can do to tailor them to the 21st century, to all of the innovations that are now available to us to allow people to gain the knowledge they need to become competitive in a 21st-century economy. That is going to require, in my opinion, a significant restructuring on how our higher education is developed.
This is not a threat to liberal arts colleges or a transitional 4- year college education. That will always be a part of our system. It is an important part of our system. But that does not work for everybody, not because they are not smart enough but because they have a job during the day, because they are raising three kids. If you are a single mom with three kids and a full-time job, you cannot just leave all that behind and go to Gainesville, FL, to the University of Florida for 4 years. You need the ability to get that degree that allows you to do that. I lived that. My sister had to do that. She went back to school in her thirties and finished her college degree and then got her master's to become a teacher, and today she is an assistant principal, all the while raising two boys on her own. She would not have been able to do that if the only choice she had available to her was the University of Florida, Florida State, because she couldn't just move. That doesn't work for someone in that part of their lives.
We need to have answers. So I hope we will spend some time focusing on what we can do and reforming the way we accredit colleges, particularly when it comes to student financial aid, and in the way we structure our financial aid programs so that the education system meets the needs of our 21st-century students and not the other way around.
I yield the floor.
The ACTING PRESIDENT pro tempore. The Senator from Maryland.