Student loan debt and the cost of college are out of control and climbing

Student loan debt and the cost of college are out of control and climbing

The benefits of higher education are on the minds of nearly 2 million college-bound high school students graduating this spring.

To make matters worse, federal student loan rates will rise 13.5 percent this summer. The long-awaited and urgently needed reform of our nation’s higher education system will have to wait at least another year.Advancing reforms to help make higher education more affordable were touted as a leading priority for the 115th Congress and the 2016 Republican Party Platform. Yet, the House has yet to pass its Higher Education Act, (Prosper Act).

Just a few days ago Sen. Lamar Alexander (R-Tenn.), Chairman of the Senate’s Health, Education, Labor and Pensions Committee, told the New York Times education conference, “the Senate will not produce promised higher education legislation this year,” adding, “the Democrats won’t do it, they want to wait until next year to see if they’re in better shape politically.” Sadly, these two events are not among the many gifts Republicans were expecting to receive after the Obama administration’s “graduation.”

Federal student loan debt and the cost of college education are out of control and climbing at an unsustainable trajectory.

The primary reason for this is three-fold: unfettered access to federal student loans; a plethora of overly-generous loan forgiveness and multiple repayment plans which encourages over-borrowing and frees schools from the responsibility to charge prices that actually match the market value of the degrees they offer; and the fact that nearly half of undergraduates take at least six years to earn their degrees.

To underscore the meaning of this third cause, four years ago the average cost of just one additional year at a four-year public university was nearly $64,000 in tuition, fees, books, living expenses and lost wages.

The guardians of U.S. higher education complex will give you a litany of other reasons why college costs have increased, but as research fellow at the Family Policy Institute of Washington, Blaine Conzatti, summed it up two years ago, “Millions of students have become burdened with previously unimaginable levels of student loan debt needed to finance schooling that has been made artificially expensive by government intervention.”

Almost without exception, market costs rise whenever there is an artificial stimulus that acts to increase demand. Moreover, this phenomenon has been especially evident in the interaction between increased student loan availability and overall college enrollment and price inflation since 2010.

Progressive democratic thinking about tuition-free schools has increased access to federal student loans. Moreover, and overly generous debt forgiveness has led to unrealistic expectations on the part of millions of students which:

(1) helps explain current loan delinquency rates which are now nearly as high as they were on subprime mortgages during the housing crisis

(2) discourages personal responsibility

(3) contributes to rising college cost

Removing a sizable portion of a student’s financial responsibility to repay his/her federal student loans encourages students to borrow regardless of whether or not doing so is a smart financial decision. While federal student loans can help facilitate college access, they should not guarantee access to any institution at any price.

After several years of congressional hearings on higher education reform to explore opportunities for promoting innovation, access and completion; simplifying and improving student aid; reducing college costs and improving college affordability; empowering students and families to make informed decisions; and ensuring strong accountability and a limited federal role, the inability of the 115th Congress to produce and pass a bipartisan higher education reauthorization bill for the president is a national disgrace.

As sad as it is, it appears the only way a major overhaul of our outdated, costly and Byzantine system of higher education will occur is if the Republicans pick up more seats in the Senate.

Despite the pronouncements of political pundits, this may not be that difficult. Of the 35 senate seats on the ballot this Nov. 26 are held by senators who caucus with the Democrats, and only nine are held by Republicans.

Democrats will work very hard to protect their incumbents in the 10 states which Trump won in the 2016 Presidential Election. But this will not be easy considering Republicans have done pretty well in addressing the top four policy issues on the minds of voting Americans come this November, which are the economy, security, health care, and seniors issues according to a recent major poll by Morning Consult.

The real question is what will Republicans do to address education, the fifth top policy issue on the minds of voters this November? The good news is that House Republicans met last week to discuss the Prosper Act.

House passage of the Prosper Act will help Republican candidates defend the Act’s many worthy provisions when higher education reform emerges as front and center during coming debates.

Passage of the Act would be a fine addition to the long list of significant Republican accomplishments over the last year and a half. It also signals that Republicans tried really hard to pass the type of education reform that will promote our economic competitiveness and prosperity.

Unfortunately, having to wait another year or two for a major overhaul of the higher education is another example of how some Members of the 115th Congress refuse to work as responsibly as they should for the people who elected them. The inability of Congress to staunch the unacceptably high cost of education in a bipartisan manner has been a national disgrace.

Though not perfect, the Prosper Act is a very responsible step forward. Republican victories in November may very well depend on an astute and well-reasoned defense of the urgent need to streamline the student loan program, cap loan limits, cut unnecessary regulation and increase grants for undergraduates who truly need them. Students, parents and taxpayers deserve a higher education system that works for them.


Working with drones: Still not a career for most?

Karan Kamdar, president, Indian Drone Racing League, hopes the government will relax norms; and Bhavesh Sangani (below) sees drone flying only as a part-time job. Photo: Aniruddha Chowdhury/Mint


While studying at an engineering college in Tumkur, Karnataka, in 2009, Bhavesh Sangani bought a small toy: a remote-controlled helicopter. Before he started flying it, he tied it with a thread, just like a kite, scared it might land somewhere else. Something worse happened—the flight crashed and the toy was wrecked. What remained with Sangani, however, was the desire to fly something with a remote control. The same year, he started a club in college that made DIY remote-controlled flights or drones. “By the time I graduated in 2011, we had built 36 remote-controlled electrical planes, all self-taught through the internet,” says the 28-year-old. The hobby helped Sangani land a job as an engineer with Quest Global, an engineering services company based in Bengaluru, straight out of college.

It has been nine years since Sangani picked up drone-flying as a hobby. In this time, he has seen it evolve from a geeky pastime to a fledgling, yet promising, career option that is in demand in several sectors—from movie shoots and public sector undertakings to mining companies and survey agencies.

Bhavesh Sangani with his drones. Photo: Hemant Mishra/Mint

“Since I have a lot of experience flying these birds, I can easily choose to become a full-time test pilot for new products for mapping or surveying in a few years. There is a lot of scope for future growth of this technology,” says Sangani.

Globally, the market for piloted drones is forecast to more than double by 2022, according to a European Commission impact assessment report released in December 2015. The report estimates some 150,000 jobs by 2050 in Europe alone. According to an estimate last year by the non-profit body, Consortium of Unmanned Vehicle Systems India (Cuvsi), there are 40,000 drones in the Indian sky and Indians have spent more than Rs40 crore buying civil drones, even though their civilian use is illegal.

Karan Kamdar, 33, president of the Indian Drone Racing League (IDRL), which organizes drone-racing events in colleges, moved from the US to India in 2014 to explore a start-up experimenting in drone photography, DIY drone kits and robotics. When the Indian Institute of Technology, Gandhinagar approached him in 2016 to conduct a First Person View (FPV) drone race (in which a pilot can view video feed from a camera attached to a drone through a headset or goggles) on its campus, he knew this would be big. “When this offer came to us, there was just a small group of Bengaluru hobbyists who did FPV racing. I decided to put up a website to request for teams,” he says. Within 24 hours, Kamdar and his team had hundreds of inquiries. The Gandhinagar event was India’s first competitive drone race; it was won by Sangani.

Soon, Kamdar started getting inquiries from institutes, drone pilots and students who wanted to make their own drones, and teams and individuals interested in participating in the races. “Since the first league, I haven’t had time,” he says. “We’ve conducted 17 events across the country in one and a half years, have grown to a community of 800 pro pilots who are training others on how to build and fly their own quads or drones, have a dedicated team of designers who create challenging tracks for their pro pilots, and have even held a night race. And this is just racing drones that I’m talking about.” Kamdar has also launched a marketplace for drone spare parts, runs workshops on drone-making and piloting, and is the go-between for projects and corporate events for the pro pilots in his community. Kamdar charges Rs15,000 for hosting an IDRL event, on top of actual cost. Most pilots work part-time since it’s a niche career. “Our pilots have a career in aerial photography, mining industry, testing for drone start-ups and many other undeveloped fields,” says Kamdar, adding that he hopes the government will relax its policies so that the hobby can become a lucrative career.

In October 2014, the directorate general of civil aviation (DGCA) imposed a blanket ban on all civil operations of drones in the Indian airspace, with permission possible on a case-by-case basis. “If I’m shooting a film and need government permission for drone flying, the law says that I have to get the permission for that day and time I plan to fly 90 days in advance. What if the weather that day doesn’t permit me to fly?” asks Raisin George, a documentary maker and digital communications professional at a Bengaluru-based start-up who has been practising drone flying since March 2016.

Using his DJI Phantom 4 drone, the 31-year-old has made films on treks in the Himalayas, of a few monuments outside Bengaluru, and beaches like Kaup in Karnataka’s Udupi district. He even managed to convince the Bangalore Metropolitan Transport Corporation (BMTC)—after chasing them for six months—to make a documentary on Bengaluru buses. In March, the documentaryWhat Bengalureans Think About BMTC Buses won an honourable jury mention award at the Indian World Film Festival in Hyderabad. Now George regularly gets inquiries from prospective clients for aerial photography and videography, but the moment he tells them about the permissions required from DGCA, they say, “Okay, some other day.”