The Agenda

How to Fix Pell Grants

As Rick Hess explains, the higher education landscape has changed considerably since the creation of the Federal Pell Grant Program:

Americans are justifiably fond of programs that help make college affordable today while sticking future taxpayers with the bill. That said, at least four major changes have unfolded since the Pell was created. One is an explosion of data on institutional quality and what students actually learn in higher education, and the attendant focus on accountability. Second is the dramatic growth of for-profit postsecondary education. Third is the availability of online learning. Fourth is the massive increase in “nontraditional” students.

In light of these changes, Rick suggests a new approach:

 

We could transform Pell into something more like a federally funded education savings account that recognizes the mix-and-match opportunities and lifetime learning dynamic of the 21st century while incentivizing just that behavior. The bigger point is that the kind of creative rethinking about spending and budgets that’s so essential in K-12 is equally critical, but perhaps even less evident, when it comes to higher ed.

Here’s one tack: Shorten the eligibility window, reward students and institutions for expeditious progress in completion and employment, and permit students to retain half of any unspent Pell dollars in a dedicated account for future education. 

I can see why higher ed administrators reluctant to change how they do business might be reluctant to embrace this approach, but the case from the perspective of taxpayers and students looks fairly clear. 

Reihan Salam is president of the Manhattan Institute and a contributing editor of National Review.

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