Financial Aid—Shoot for the Moon

In what is being called landmark legislation, college loans must be converted from private lenders to the federal Direct Loan Program.

Campuses across the country are gearing up to meet the July 1 deadline to revamp student-loan programs, as required in the federal Health Care and Education Reconciliation Act of 2010.

Direct loans should be better for students. The fees banks had received to administer the loans can instead go to expanding Pell Grants. Furthermore, the lending relationship is more stable. The student loan will not be sold to another lender.

However, to call student loans “financial aid” is a bit of a misnomer. Nevertheless, the Free Application for Federal Student Aid (FAFSA) serves to qualify students for subsidized student loans. What high school guidance counselors know about, but we never see publicized are the lost opportunities to highly proficient and talented, but poor, students. Such students, after being accepted into a highly selective school, must await the financial aid award letter before deciding to to attend the school. Sometimes the financial aid package covers only half the cost. The aid package already includes loans for both the student and the parents. The implication of the financial aid package is that it already includes the maximum loan for which they qualify. If students and parents are unable to borrow to make up the difference, then the student is effectively barred from attending the school to which they had been admitted.

The American Association of State Colleges and Universities (AASCU) documented the questionable practices of student loan lenders. A few years ago, Consumer Reports explained how some universities use insufficient financial aid to effectively nullify the academic acceptance of poor students. The practice has a name which I have forgotten and I have been unable to locate the original Consumer Reports article. Of course, colleges are not supposed to engage in such low-down tricks, but like any form of discrimination, it can be well nigh impossible to “prove.”

The institution a student attends is a track to future opportunities. It is not true that all a high-achieving low-income student has to do is get scholarships. If the financial aid package (scholarships, grants, loans, work-study) is insufficient, the low-income student loses access to opportunity. Frankly, loans are not financial aid, so it seems odd that students who do not qualify for financial aid do not qualify for student loans either. Students with no financial aid must go to the private loan market if they and/or their parents have insufficient funds.

Many of the best schools are known for providing 100% financial aid. Harvard, for example, "guarantees to meet 100 percent of a student’s demonstrated financial need for all four college years based on information we receive from the family each year". So does the University of Southern California.

USC administers a robust financial aid program with a long tradition of meeting 100% of the USC-determined financial need for those undergraduate students who satisfy all eligibility requirements and deadlines.

Therefore, a high-achieving, low-income student might as well shoot for the moon, rather than economize at a school that is cheaper, but provides a lower percentage of financial aid.

Consumer Reports puts out a wonderful primer on financial aid that should be required reading for students and their parents.

Did Schools Hire Too Many Teachers?

Data from the U.S. Department of Education show that from 1999 to 2007 teachers were hired at more than twice the rate of the K-12 enrollment increases. When schools feel tremendous pressure to reform yesterday, they pick quick and dirty methods. For example, a school can look like it is raising student achievement by pushing first grade curriculum into kindergarten. See all the little kids with pencils and paper---yay, instant academic achievement.

Another easy reform instantly reduces teacher-student ratio by hiring more teachers. But if every classroom already has a teacher, where to put the extra ones. Schools responded by pulling experienced teachers out of classroom into professional development positions, and replacing them with new teachers. The rate of teacher hires far outpaced the increase in student numbers. Some schools even added teaching staff as enrollments declined.

The glut of new hires even overpowered the dreaded effect of boomer teacher retirements. Schools had anticipated a loss of one-third of the teaching force when baby boomers began to retire in 2008. Along about the time those teachers might have expected to retire, their retirement funds, if stock-based, as most are, were pummeled by the stock market. Teachers postponed retirement. As I have explained in previous articles, experienced teachers from out of district have a difficult time getting hired. No one wants proven experience because it costs money.

Once in a while, a veteran gets in. For the lucky school, these veterans teachers are a bargain. Most schools give a maximum of only five years credit for experience in figuring wages. Any teacher with more than five years experience accepts a pay cut. If the teacher has twenty or more years of experience, the school gets all the proven competence for an outrageously low price. Nevertheless, in a fit of impressive shortsightedness, many schools consider just five years experience too expensive, passing over the grizzled veteran in favor of pink-cheeked new graduates.

During the hiring frenzy, schools may have hired some of these veterans. I am unaware of any demographic study, but I wonder how many got caught in the lay-off wave of 2009. You know, last in, first out. For a boomer teacher (or any boomer) to be laid off this late in their working life is disastrous. Those in their fifties may never be fully employed again. Yet Social Security benefits may be a decade or more away.

More an more school boards have noticed their hollow teaching cadres. Lots of young, inexperienced teachers, and declining numbers of mid-career and near-retirement teachers. Years and years of short range hiring policies based on minimizing salaries by sacrificing experience have produced schools without a solid core of highly experienced teachers. It is one reason while professional development contractors have secured such a foot-hold in the schools. Once the schools have signed a contract with one of these professional development outfits, they have no more money for the independent provider.

These virtually unemployable veteran teachers would be great local professional development providers. They are intimately familiar with local conditions, needs, and perceptions. They are uniquely positioned to provide customized professional development, the sort the big outfits advertise but rarely deliver.