Throughout the 2016 election, liberal politicians made free college a cornerstone of their campaign promises. Ignoring for a moment that this would be a colossal economic disaster, we have seen little effort from Republicans since Election Day to offer a viable alternative. The Trump Administration has made its priorities for the first 100 days clear, and with all the talk of trade deals, pipelines, and immigration, it is possible we could see higher education get lost in the shuffle.
While many millennials are crippling under the weight of student loans, it is beyond time for action. Enter Congressman Tom Reed.
Reed represents New York’s 23rd district — a small, rural area upstate; a community of largely hardworking blue-collar voters, and a District that is the definition of the “forgotten America” that helped Donald Trump secure his place in the Oval Office. It’s also the home of one of the nation’s finest academic institutions, Cornell University. One year at Cornell will cost you upwards of $50,000. And that’s just the cost of tuition. For the average American, that’s not just money you find stuck between the couch cushions.
Reed’s connection with his constituents has given him incredible insight on the economic struggles hindering not only people in New York’s 23rd district, but average Americans across the nation.
The Reducing Excessive Debt and Unfair Costs of Education (REDUCE) Act is the Congressman’s latest effort to look out for “the little guy.” The strategy is to advocate for fiscal responsibility among universities by analyzing their endowment fund. Under the REDUCE Act, universities with an endowment exceeding $1 billion would be required to use 25 percent of investment gains to help working class families ease the sticker shock of higher education. This includes tuition, books, room and board, and more. This benefit would apply to families earning less than 600% of the federal poverty level.
Reed’s REDUCE Act is a new solution to an ongoing problem. In a 2015 piece for the New York Times, Victor Fleischer, a law professor at the University of San Diego, shared that Yale paid $480 million to private equity fund managers, $137 in management fees, and $343 million in performance fees.
“We’ve lost sight of the idea that students, not fund managers, should be the primary beneficiaries of a university’s endowment. The private-equity folks get cash; students take out loans,” Fleischer said.
Universities are starting to sweat it, too. The Association of American Universities (AAU) has been all over Capitol Hill meeting with every elected official they can in an attempt to keep a tight grip on the universities’ pocket books.
“They do research that helps save lives and that drives the economy. They educate students from all walks of life. We’ll keep pointing that out,” Barry Toiv, spokesperson for the organization, said.
AAU’s mission statement says their members are “awarded federal funding for academic research, are improving human life and wellbeing through research, and are educating tomorrow’s visionary leaders and global citizens.”
But nobody is questioning the value of an education. What should be called into question is why universities are spending tens of millions of dollars on such outrageous amenities. Louisiana State University wrote an $85 million check for a lazy river. High Point University in North Carolina has an on-campus steakhouse with free five course meals. The University of Pennsylvania boasts a 40-foot rock climbing wall — and still charges students $100 to use it on top of the $50,000 a year tuition price tag.
Between paying hedge fund managers and spoiling the students who can actually afford to attend such lavish universities, middle class students are getting left behind and their families are left to foot the bill.
Everyone has a different path to achieving their own definition of the American Dream. For many, the first step along the path is earning a college degree. Today, college debt has officially surpassed a total of $1 trillion dollars in the United States, which is more than America’s collective credit card debt. A reasonable solution to help ease the financial burden is long overdue. The REDUCE Act is a step in the right direction.