On Oct. 15, presidential candidates John McCain and Barack Obama stepped onstage at Hofstra University to engage in the final presidential debate of the 2008 election. The debate was the third such event to take place at an institution of higher learning, yet little discussion was devoted to higher education itself.
During the first two debates, the word “college” was only used a total of six times — all by Obama. At Hofstra, “college” came up twice as often as it did in both of the first two debates combined — but even then only in roundabout, vague terms.
According to economics professor David Feldman, a specialist in higher education economics, Obama’s plan has fewer total items listed, but is more specific than McCain’s.
Feldman is currently co-authoring a book with fellow economics professor Robert Archibald entitled “Why Does College Cost so Much?”
“One should not read anything into the different number of points each side raises, believe me,” Feldman said, “because, actually, although the Obama site lists two, they’re very specific. The McCain site lists five, and there’s nothing there.”
The first of Obama’s proposals is a $4,000, fully refundable tax credit that would be given to college students who committed to completing 100 hours of community service.
“The virtue of the proposal is that it’s going where the issue really is. And where the issue really is, is access, and access is governed by your means,” Feldman said. “So, if, in fact, this proposal has the refund idea that works like a negative income tax or an earned income tax credit so that it’s not bounded at zero, then it is clearly in much the same fashion as the Pell Grants to raise access.”
Obama’s second proposal aims to simplify and expand the financial aid process by moving the financial aid system away from a FAFSA application process toward a 1040-based program where, to apply for financial aid, one would essentially check an extra box on his or her tax forms.
“One of the problems with the FAFSA approach is that it’s a complicated formula that looks partially at a family’s income and partially at a family’s wealth,” Feldman said. “When families know that they’re going to get essentially taxed on the basis of wealth, it may reduce the incentive to save. So, by moving to a system that’s based only on current income, it eliminates that disincentive for people to raise money.”
Feldman also found disadvantages to the plan.
“The downside … is that we know that there’s inequality of income. But there’s even worse inequality of wealth,” he said. “So if you move away from a system that at least recognizes wealth as something that you can tap into, you are moving away from a system that is going to essentially tax wealth, which is very unequally allocated.”
Feldman said Obama’s plan, though open to debate, is solid.
“To me, both of these proposals make a certain amount of sense,” Feldman said. “They’re simple and to his credit, they’re there. They’re serious. They’re specific.”
Feldman also agreed with many of McCain’s higher education proposals, though he said that most of them are too vague.
“The first proposal is to make more information available to parents about costs,” he said. “This idea is not stupid — the notion that people ought to have better information about ultimately what this is going to cost them, so they can make better decisions a priori. This makes sense.”
Unfortunately, Feldman said, it’s already been done.
“The funny thing is that the Higher Education Act, which was just reauthorized this summer, does that. So essentially, it’s already been codified into law,” he said.
The remainder of McCain’s proposals seek to simplify tax benefits, consolidate federal financial aid programs, improve the student lending process and end research and other education earmarks.
“It would be nice if there was some meat there to tell us, what’s the problem, specifically, and what are you going to do about it?” Feldman said. “I would need to see some more specifics to know what he thinks really needs to be fixed. I don’t know, and it’s not clear from the proposal.”
Ultimately, Feldman said, neither of the candidates’ plans are perfect.
“In any one of these proposals you can see pros and you can see cons, and reasonable people can disagree about whether or not each one of these things is wise,” he said.