Free College Jumps The Shark

When I was a kid, the TV show Happy Days was a big deal. For Millennials too young to remember, or too indebted and/or underemployed to care, Happy Days was a fond look back at the simplicity of the 1950s through the lens of the more complex 1970s – like reflecting on quaint Clinton-era scandals from the vantage point of the Trump Administration, only less depressing. In our games, my older step-brother wore a leather jacket and made us call him the Fonz, as in Arthur “Fonzie” Fonzarelli, the focal point of Happy Days played by Henry Winkler. My younger brother would pretend to be Ron Howard’s Richie Cunningham. I was Ralph Malph.

Happy Days ran for 11 seasons but lost its way around season five when it ran out of 1950s tropes and began exploring 1970s fascinations like aliens and Evel Knievel. First, the Fonz successfully jumped a row of cars on his motorcycle, which wasn’t so far-fetched. Then, in a brazen ratings grab, Fonzie was challenged to a water skiing contest in which he had to jump over a pen containing a man-eating shark. (He did it wearing his leather jacket, which I doubt would have stopped the shark.) The ridiculous scenario gave birth to the idiom “jumping the shark,” which signals when someone or something past its sell-by date employs a gimmick to draw attention to itself, but which only serves to highlight its sad decline.

This week, thanks to someone who’s also past his sell-by date, we have a new shark jumper: Free College. On Monday, Senator Bernie Sanders introduced legislation to forgive all $1.6 trillion in American student loan debt and made it a pillar of his candidacy for the 2020 Democratic nomination.

The impetus for Free College is understandable: an unprecedented crisis of college affordability. And like Happy Days at its shark-jumping moment, Free College is also in season five. In its first season, Tennessee Republican Governor Bill Haslam established the Tennessee Promise covering tuition at state community colleges and technical schools. Seasons two through four saw Democratic governors, senators, and congressmen in a Free College arms race, starting with community colleges, progressing to four-year state universities. At the end of last season, Senator Sanders introduced a bill – co-sponsored by a who’s who of Democratic presidential candidates – that would provide federal Free College for all public two- and four-year colleges.

This season of Free College kicked off in April with Senator and candidate Elizabeth Warren as the Fonz on a motorcycle jumping over a row of cars. In extending Free College to debt forgiveness, but ostensibly in a careful manner (up to $50k in forgiveness for families with incomes below $100k, but none if you make over $250k), Senator Warren attempted to hit the center of the ramp. But in this week’s episode of season five, with universal, blanket loan forgiveness, Senator Sanders turned a somewhat plausible motorcycle jump into a ludicrous shark jump.

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I remember watching Happy Days in season five and enjoying it as much as I ever had. Similarly, the Free College movement continues to elicit sympathy. Seventy percent of Millennials believe student loan debt is a bigger problem than North Korea because – in a full-employment economy – they continue to underperform prior generations on virtually every economic metric. Student loan debt is an anchor around the neck of this generation; millions are suffering, and as with wage scarring, without some intervention the repercussions will be permanent. For me, arguments that Free College doesn’t cover housing, food, transportation, or books, or that Free College is regressive – that most of the benefits of Free College flow to wealthier students (who would have paid tuition, while low income students are more likely to receive Pell and state grants to cover tuition) – aren’t deal-breakers. I don’t believe in letting the best be the enemy of the good, so the fact that benefits aren’t as all-inclusive or targeted as they might be shouldn’t rule Free College out.

But here’s my succinct TV review of season five of Free College, as scripted by candidates Warren and Sanders: Bad and Crazy.

Season five is bad because it irrationally privileges:

• Public colleges and universities over private universities.
• Those who’ve attended college over those who haven’t.
• Those who opted to attend graduate or professional school in the past decade, as they have by far the most student loan debt. As Oren Cass of the Manhattan Institute noted, “student debt holders are, on average, less deserving or in need of a wealth transfer than… the median American (who doesn't have a college degree).”
• Those who haven’t paid down or paid off loans over those who’ve worked hard to do so.
• Today's absolved debtors at the expense of tomorrow's – who are unlikely to get a second bite of the apple. As Kevin Carey has shown, Free College still means loads of future student debt from private colleges and graduate programs. And as we've seen in the immigration context, amnesty becomes much more politically challenging after the first go-round.

And what’s crazy about this season?

• Free College does nothing to inhibit spending or further tuition increases by colleges and universities.
• Free College would cost well over $1 trillion, ostensibly paid for through new wealth or financial transactions taxes. (Imagine what a comparable sum could do to improve student outcomes if added to a new income-driven repayment program with institutional risk sharing.)
• As currently constituted, Free College creates a bizarre temporal asymmetry. Universal debt forgiveness signals that both public and private colleges were equal(ly bad) in the past. But going forward, free public colleges and universities are the only responsible choice.
• Similarly, while debt forgiveness signals that college is broken – like a product for which the CPSC is requiring a recall – Free College exalts college as the pathway for all. According to candidate Warren, “a public college education is like a public K-12 education – a basic public good that should be available to everyone.”

The two biggest problems with the current season of Free College are fundamental. Reifying college as we’ve known it for the past century is reckless at a time when technology is changing so quickly and the future of work is so uncertain. Policy makers have a responsibility to encourage colleges and universities to modularize and stack credentials and shift to a model of lifelong learning, allowing students to gain the education and skills they need when they need them, rather than rolling the dice to see if they can make it through 120 credits. Free College provides colleges no incentive whatsoever to modularize: Why offer any faster (or cheaper) programs when government covers four years in full? As such, any federal version of Free College is likely to widen the gap between the talent higher education supplies and what employers are demanding, thereby worsening employment outcomes.

Here’s a K-12 analogy for Free College: It’s as if we took a school model that isn’t producing optimal student outcomes and changed policies such that it’d be financial lunacy to make any other choice. School reform wars notwithstanding, no one’s policy priority is providing better access to bad schools. For decades, the goal has been improving schools, not making it financially attractive to attend suboptimal ones.

Second, for the first time a postsecondary education issue could prove decisive in a presidential election. Pressed by candidate Sanders in 2016, Hillary Clinton adopted Free College for the Democratic Party platform. Even if neither Warren nor Sanders is the nominee, the 2020 platform could easily combine free college with some form of debt forgiveness. As a result, Democrats could become identified as European-style socialists, supporting a model where students remain forever enrolled in universities that the government insulates from the labor market, or as the party proposing plans that – again in the words of Oren Cass – are “less equitable and less socially useful than simply throwing $1.6 trillion out of a helicopter.” Which will work well for Republicans, because their path to victory requires tarring Democrats as the party that helicopters around coastal enclaves thanks to all the money they’ve made from their expensive college and graduates degrees (and now saved thanks to debt forgiveness).

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In college, my roommate Chris developed what he called “keg theory.” Keg theory went like this: If we’re going to have a few beers, we might as well get a case. And if we’re going to get a case, we might as well get a pony keg. And if we’re going to go through the trouble of getting a pony keg, we might as well get a keg.

Just as this slippery slope had a negative impact on our health, this season of Free College has become an reality show-esque bidding war for Democratic primary voters – untethered from serious policy (like bankruptcy relief for borrowers) and likely to have a negative impact on the health of the Democratic Party as well as the future of Free College itself. For in the same way that Secretary DeVos’s evangelical support for charter schools has politicized, tainted, and perhaps killed the charter school movement, the Progressive impulse to incorporate debt forgiveness will prove to be the end of Free College’s happy days: the moment that Free College jumped the shark.