 Good morning, and thanks for coming out to New America today. It didn't snow, so that's good. That's one good thing to start with From the 1940s with the introduction of the GI Bill through the 1970s with the creation of Pell Grants the federal government and states transformed American higher education from a bastion of privilege Into a path into a path to the American dream But in the years since this progress has stopped and in fact reversed itself Instead of facilitating upward upward mobility it has instead been exacerbating inequality Over the past 30 years the purchasing power the Pell Grant has plummeted College prices have skyrocketed states have disinvested from their public colleges and universities and Students are taking on more debt than they ever have before Only one out of ten of the country's low-income students earn a bachelor's degree by the age of 24 Compared to three out of four of the wealthiest students What's gone wrong, and who's to blame in her new book degrees of inequality have the politics of higher education sabotage the American dream Cornell University political scientist Suzanne Metler Argues that the crisis higher education is facing is fundamentally a result of political failure She writes that our landmark higher education policies have ceased to function effectively and lawmakers consumed by Political polarization and plutocracy have neglected to maintain and update them Today we are lucky to have Suzanne Metler with us to talk about the book and what the government can do to ensure that colleges continue to provide a window to opportunity Ms. Metler is a professor of American institutions in the government department at Cornell University and a fellow at the Century Foundation Which is co-sponsoring this event She is the author of three previous books including soldiers to citizens the GI Bill and the making of the greatest generation and The submerged state how invisible government policies undermine American democracy in addition to Ms. Metler We have two other distinguished panelists today each of whom will respond to the book First we have a man who practically needs no introduction The former deputy under secretary of education Robert Shireman who is now the executive director of the organization California competes and we have Francis E. Lee a professor of government and politics at the University of Maryland We've provided more detailed bios That you can get at the front desk I'm gonna start by asking Ms. Metler a few questions about her book and then I'll invite Bob and Francis to come up and join us To provide their perspectives so without further ado, I'll get the conversation started Great Okay, can everybody hear me just want to make sure okay So we first met Back in 2007 when you started working on this when you started working on the book and I've just been wondering what took you so long I've been waiting to see this every year Well, you know, I've had a few other things going on I do teach classes and have lectures to write and grad students to advise and so on And I also wrote another book in the meanwhile that I hadn't been planning to write this emerge state but But honestly, you know for me for I'm sure that many people here in the room Work day in and day out in this policy area in higher ed And have a really deep knowledge of it and here I was coming in to look at this and with each book project I do I always, you know Decide at the outset what the scope of it will be and I say to myself how hard can that be and then you know You get a ways into it and you say what have I done? And that was particularly true in this case because I had the idea that I should look at both What was happening at the national level the state level and both at spending and at regulatory policy So it was a lot for me to try to get my head around and took me well So why did you decide to pursue this book? well, the previous book that I had written was about the GI Bill about World War two veterans and I was interested in not just the socio-economic impact of the GI Bill But also its impact on their participation as citizens in political organizations and politics And I found that it had these very positive effects for that generation And then if you look, you know across the middle of the 20th century Up through the development of the National Defense Education Act, Higher Education Act and Pell Grants We kept expanding access to college and we had really tremendous success in that period in increasing college graduation rates across the income spectrum beginning to do that After you know a long period of time where higher education had really been about being privileged So then I began to wonder well, what's happened since then and so you know I started to look at the indicators and you see that from that You know we used to just a few decades ago be the international leader in college graduation rates for your degrees but about 10 or 11 countries leapfrogged over us then you look at who's getting for your college degrees today in the United States and What you see is that we're continuing to have increases for people who grew up in the top income quarter Where it's you know most everybody goes to college and about 71% get a four-year degree by age 24 But below that the gains have been really unimpressive and particularly below median income Today people below median income are barely more likely to get a four-year college degree Then were people in those groups in the 1970s which is really striking given that a college degree is more important than ever today So today it's one in ten people in the bottom income quarter and 15% in the next Quartile who get a four-year college degree by age 24 And then the plot thickens and things look even worse when you look at the value of those degrees because there's great variation Depending upon what sector of of colleges people attend and what particular institution within a sector There are really different outcomes We have a lot of talk today in the media about the problems of high tuition and high student debt load But the more I looked at this the more I find that discussion really Inadequate because it doesn't look at the particular sector and institution and for some for many students going to college is still a fabulous path to upward mobility and Even if they take on some debt They are getting a degree that makes that debt really worthwhile They'll easily repay it because they'll get a good job not to mention all the other things that we college professors Hope they get out of a college degree But but it's really worthwhile But then there are other students at the other end of the spectrum for whom they Go to college take on student loan debt and either don't graduate Or get a degree that is not worthwhile and so they can really end up worse off than if they've never gone to college in the first place so you put together all of these trends and What I was beginning to see is that today we are really Reinforcing inequality through higher education and so I wanted to know What's driving that and you know, there's a lot of focus on what colleges and universities themselves do and about the increase in Intuition, but it's really striking that in the United States This has been an area where government has always been involved since the beginning From the Northwest Ordnance through the Morrill Act in the 20th century so I wanted to know what's government doing today and that's really the puzzle that I started out with and Where do you think things have changed? In terms of the government and higher education Yeah, what what are the what areas and where are the real problems? Yeah, well What I began to see is that today we well, I started out, you know Thinking that I was a detective and I had all of these culprits that I had to examine one by one and interrogate them So was it something about interest groups? Was it something about the decline of civic organizations and so on and As I examined these things there was no You know, they're each one gave some partial explanation But none of them were telling me what the big story was that was going on But the more I studied this policy area I began to Decide that what is going on in contemporary politics today and not just in higher ed But I think in lots of other policy areas is that we have these existing Policies that are now part of the political landscape. They were created in the past many landmark policies. I Came up with a term that I call the policy scape So we have these existing policies that themselves can develop in all sorts of ways some of which were intended and some which were Unintended and they can generate all kinds of effects and they require policy maintenance a major task of contemporary governance is for lawmakers to To monitor what's happening with these policies to evaluate it to assess issues of policy design and administration and to maintain policies and make changes over time as is necessary and What I began to recognize is that our current political circumstances are a disastrous combination with the demands of maintaining public policies and So there you can see real variation over time in the capacity of the political system to do that kind of policy maintenance and I think as recently as the late 1980s and early 1990s We had a more conducive combination between our political system and that task than we do presently because of both the rise of partisan polarization and What I'm calling plutocracy You talk a lot in the book about Polarization and plutocracy and I'm wondering if you can define those terms a little more and and explain what you mean Yeah, that's right. So polarization is is not a term that political scientists throw around lightly we have quite a developing literature on this and what we're talking about here is that if you look at members of Congress the extent to which Democrats and Republicans today in Congress Overlap in their votes and switch sides would go across the aisle It has become less and less and less than it was in the past and Part of this is driven by the decline of moderates particularly in the Republican Party You have greater homogeneity in voting patterns in each party across issues and And so the parties seem to be pulling away from from each other So that's problematic for policy making most often because it leads to stalemate and As I looked at federal student aid for example What I found was that in votes around even amendments to the reauthorization of the Higher Education Act that the gap between Democrats and Republicans even on lots of small matters has grown larger and larger and larger and that Indicates why we haven't had major new Solutions to problems in higher education if we're not even agreeing on those small issues And we're not even finding the sort of political space in which to negotiate and deal with with Detailed naughty kinds of issues that have to do with unintended consequences of policies and so on it's not surprising So that's a big problem of polarization And then by plutocracy what I mean is that you know, so here we have this environment where the American Polity or citizens generally would like government to be doing lots of different things And most often we have stalemate because of polarization on lots of issues But there are some interests that manage to rise above the fray and have their voices heard and get government to respond to them And they are most often powerful vested interests Industry for example In any particular area that managed to get government responsiveness and that's been happening in higher education as well and maybe you could Build on that and say how that's been happening in higher education. Yeah Well the example that I end up the book with I in the book I focus a lot on what was happening for a long time with bank-based student lending where those sorts of dynamics were occurring and So one of the really positive developments in recent years is the demise of bank-based student lending in 2010 but another area where this kind of plutocratic governance has been happening is with the rise of the for-profit colleges and so this sector of higher education on The one hand has done has been this sector that really reaches out to low-income people and You know in traditional higher education I will be the first to admit that we are very traditional You know we tend to do things the same way We've always done them and the for-profit sector came along and they said we don't have to do it this way We can find other ways to accommodate People who have busy lives. They're already working. They have children to take care of etc And so they really Reached out to low-income students. The problem is that the outcomes are really poor Most all of their students borrow and not surprisingly because they're they're low-income people But what these schools charge is very high tuition much more than what? public universities and colleges charge on average and The average student leaves with a very high degree of student loan debt $33,000 is the median debt and And then often end up worse off because they can't repay that student loan debt They're evidently not getting the jobs that would enable them to repay it and so they account while they are now About 13% of all colleges and universities. They use about one and four federal student aid dollars in the Higher Education Act and They account for about 47% of all student loan defaults The average student who goes to one within three years of graduating if they do graduate with a bachelor's degree are in Student loan default and so there's really poor outcomes, but these Colleges are allowed to receive up to 90% of their revenues from the Higher Education Act Title 4 that by itself and that doesn't count what they're able to get from the GI Bill and other programs so they've become very politically active in trying to make their point to members of Congress to And they've they've managed to be quite successful in that So besides the rise of for-profits you also mentioned some other Policy changes that have occurred over the last 30 years that you think are detrimental Yeah, you want to mention those well if I would speak first about federal student aid on the one hand We're spending more than ever today on federal student aid There are some problems I talk about in the book about policy design effects how for long periods of time Pell grants were falling behind in Their value Whereas student loans were much more easily expanded But since 2007 some of those problems have been addressed somewhat in terms of you know Pell grants being being increased Although their purchasing power is much less than it was back in the 1970s Because tuition has gone up so much more but We've also in the meanwhile created new policies tuition relief through the tax system and We keep doing more and more of this and I think this is really problematic because it means lost revenues to the federal government But in fact it does not seem to expand access to college For students who wouldn't go otherwise because of the delivery system. So that's problematic I also think we have other problems in federal student aid where we're not a federal government is not holding Either state governments or the nonprofit privates accountable In all in cases where they should be held accountable for their spending and we could talk more about that if you're interested The other area is the states and what's happening to public colleges and universities and here This is a major problem because 73% of American college students attend the public sector institutions But whereas this has always in the past been a major point of entry Particularly for low-to-middle-income students really students across the board their Tuition has increased Dramatically over time because states have really been pulling back. So states now devote 26% less per student Then they did a couple of decades ago and tuition meanwhile has gone up by about a hundred and thirteen percent Because that's the way the the colleges and universities can make up the difference They've also had to do more with less so they have more students in the classroom per faculty member More classes are being taught online as a way to save to save money And these things are really problematic for students from less advantaged backgrounds and it really hurts college graduation rates So, you know all of these are ways in which there are policy effects that need to be managed But it's not happening and you get these unintended consequences. So you say towards the end of the book that With our system of higher education in crisis the core values and identity of the United States are at stake Can you elaborate on that? Yeah So I think that it's a point in time where we need to step back and to think big about the purposes of higher education and about why government Should be having a role in it And as I was saying we've done this throughout our history from the Northwest ordinance on It's really striking how the US government thought that there were important national purposes that were served by some kind of investment in higher education and Today we tend to talk about higher education as if it's only a private good as if it's only something that benefits Individuals that allows them to be better off and it certainly does do that should do that if it's functioning well But in addition to that it serves broader public purposes For example for economic development in the United States for our economy to thrive we need people who can be doing the kind of innovation and Creativity that will help us to to move forward economically and also We've had rising economic inequality Since the 1970s in order to be able to mitigate that with all of the social problems that emerge from that Higher education is is a really effective way to do that if it's functioning well And then also to I would say reinvigorate democracy to expand Who's involved in American civic life? That's critically important my book on the GI bill really Made me very convinced of this of how powerful this is because veterans who used the GI bill to Kettig college degree became Active in many more civic organizations and much more active in political activities in the immediate post-war era Then veterans who were similarly situated but did not use the GI bill and Then I have a former student of mine Deandra Rose who's becoming a professor at Duke School of Public Policy And she looked at Student aid policies for civilian students the National Defense Education Act and components of the Higher Education Act and Found the same thing to be true And it was particularly important for women who gained access to college because of Pell grants and student loans And they became more active in politics as a result So you expand who's involved in politics and that makes the United States live up to its ideals more fully So in terms of solutions one of the things that I would get out of this is that you want to you know A pretty massive expansion of the Pell Grant program. I mean it seems and I'm wondering how realistic that really is in terms of You know the funding that we have today That's actually not what I would lead with I Ultimately, you know in the final chapter I talked about what we should do today And I would say that we need to do all kinds of important things for policy management First and foremost, so I think it's problematic that today one in four Student aid dollars is going to a sector. That's not being very responsible and accountable for expanding opportunity And so I think before we expand Pell grants again We've got to be able to manage that situation So we've got to deal with the for-profit sector effectively We also need to look at the fact that there are States that have a perverse incentive to not invest in higher-ed now The states have competing demands that come from Medicaid K-12 education etc And so they're investing in those things which you know are Mandatory spending and they can leave higher education aside as discretionary spending and figure if we do less more Federal student aid dollars will actually flow into the state there's a perverse incentive and I think we need to look at ways to Require the states to have more maintenance of effort in order to get those Pell grant dollars and then I also think that Looking at the non-profit private institutions. There's real variation There are some that Will actually really help out students on Pell grants and give them additional money out of their endowment and to really help make Sure that they can make it to graduation But there are others that do very little for those students So they borrow a lot of money and they can end up borrowing too much and being in a bad situation And meanwhile they're using their own resources to try to game the rankings by giving more merit aid to students with high SAT scores so they'll rise up in the rankings and I think that we need to find some way to hold them accountable as well So then ultimately I would say yes, we should have more Pell grant spending but we want it used really effectively to be you know for Taxpayers want that taxpayers are American citizens generally are supportive of investing in higher ed They want college to be a route to opportunity for people, but that money's got to be spent in a responsible way So I think you know one criticism that has come up about the book That I've heard is that it that it it goes a little easy on the colleges themselves you know you talk about that tuition rising hasn't been the biggest problem and You know to be fair to lawmakers there is a frustration that every time that they raise the maximum Pell Grant Colleges raise their tuitions and so there's no neck gain Over time and so I think that this is something that both parties now are you know members from both parties are very frustrated with They feel like they're Just going around in circles. I'm wondering What do you think of that? Yeah, how you respond? Yeah well, there's certainly a lot of Analysis by economists about you know why has tuition gone up so much And there are our reasons for that that I'll leave it to them to explain But I think that it is fair for the federal government to be asking universities and colleges to be Accountable in these kinds of ways that I'm suggesting about you know expanding opportunity To lower-income students and to middle-income students as well what I'm really struck by as you look across American political history is how Historically the federal government work together as partners with the states and with private institutions and Whatever the goal was across different periods of time. They all work together in concert to try to to get to those goals and I think that we've somewhat lost sight of that and actually in recent years since 2007 I think the federal government is doing a lot of the heavy lifting and the states and the institutions not Necessarily as much or not evenly across the board. And so I think we do need to find ways to hold them accountable In The other criticism that I've seen that's come up Was from Andrew Kelly of the American Enterprise Institute and he questioned whether the bipartisan support for for for profits In the House of Representatives was a question of Plutocracy or whether it was just plain old constituency influence. I was wondering how you respond to that Question well, this is a really interesting dynamic I was quite fascinated to study the politics surrounding the for-profits because You know, they they began to emerge right after Well, there were some existing before the first GI bill but they really took off after the first GI bill way back in the late 1940s and Immediately there were problems and immediately there were Members of Congress who were saying these institutions are milking the federal government And at that point in time Democrats and Republicans got together and they created some changes for the Korean war GI bill So in not too long a period of time they created some kind of a fix and then Eventually civilian student aid is expanded to the for-profits and then problems emerged again and this went on for some time and What's really interesting is if you look back at the 1980s the Complaints about the for-profits were coming from some Democrats and some Republicans. I'm particularly struck by William Bennett who is you know secretary of education in the Reagan administration who said that these schools were acting as Diploma mills that were taking advantage of poor people and then the President George HW Bush administration really wanted to try to rein them in and in Legislation was introduced by Senators Bob Dole and Phil Graham in 1990 to try to regulate them in some way Sam Nunn Had this all these investigations that were done in 1990 about what was happening and every single member of his committee Democrat and Republican Signed the final report and said something has to be done and finally in 1992 You had some Democrats and Republicans together who enacted some modest regulations Since then things have changed. So, you know, it can't be just a matter of Constituencies because the Republican Party which used to be somewhat divided around them Is now very much lined up in support of them in both the House and Senate and The way I interpret that is it's the dynamic of polarization Polarization actually makes influence easier in some ways for interest groups Because it means that instead of having to lobby every single member of Congress They can go to the leadership and once they get the leadership on board then at least that party can step in line And I think this is what's happened with the Republicans and then they've been able to focus on the Democrats and getting enough Democratic votes in the House and they've done that strategically by Hiring some former Democratic lawmakers and staffers from Capitol Hill and so on and getting enough Members of the House to step on board that they actually get votes in there in their favor So, you know, if you look at who the constituents are this it gets complicated because there's always the question of Is a member of Congress being responsive to the industry in their district? Which you know the for-profits tend to be sprinkled across congressional districts or are they being responsive to? Students in their district who are being taken advantage of and I think different members of Congress are responsive You know to one or the other So it's more complicated I did find really fascinating in the book that talk about how the parties have changed over time Not just the Republicans, but the Democrats as well You talk about how the Democrats were much more supportive of both the student loan industry and the for-profits back in the 80s and early 90s Yeah, you know, I think it's I see the interweaving of the dynamics of both polarization and Plutocracy being at play and Yeah, and the Republicans have really lined up for this industry. So It's so interesting to me that as recently as the 1980s and early 90s They fiscal conservatism was motivating many in their party to Take issue with the for-profits and to see this as wasted money as an industry that was really Milking the federal government was a term that was often used and now they've really vacillated away from that and they will say that they want to reward a sector of higher education that is the private sector but The problem with that when you look underneath it is that here you have an industry that on average the average institution is Of the top 15 or so is getting getting 86 percent of its revenues from the federal government So it doesn't seem so private and then on the Democratic side Democrats more traditionally were defenders of the for-profits saw them as really helping low-income people and There are some Democrats who will still make that argument today and again there It's problematic when you look at the actual outcomes for many low-income students But I think you see a divergence in the Senate and house now where in the Senate Polarization is ruling and so the Democrats are more and more lining up in some opposition to the for-profits But that's not happening in the house Okay Well, I think I'm going to leave it there and I'm going to call up our other panelists Bob shireman and Francis Lee Hear their views of the book And the issues that book raises So Bob do you want to start sure be happy to start? Thank you so much for for your your book It was a fun and interesting read and I swear I didn't go to the index first to see you know where I am in the book But but it really made me think not just about it helped me to get out of just the education space and think about education policy from the perspective of What's been happening with politics generally in in the country and I I want to start actually with Where your conversation with Steve just sort of led to around? What I stood what I wrote down while I was reading your book I remember Alan Bloom's old old book and so I The title that I came up with was the closing of the Republican mind and and I thought through kind of my time in policy and thinking about how It used to be that you would have in Congress some left-leaning Principles and some right-leaning principles and then a discussion And then of course interest group politics that then affected the policy that came out but the good thing was that you had the Intersection that you had that conversation between the left-leaning principles and the right-leaning principles You know maybe a market orientation versus an equity orientation and while that was affected by the by the interest group politics it The policy at least Reflected that conversation and what what it seems like has happened and I will be very interested in in the political scientist sort of view Of this is that those dynamics have changed where? The interest group especially on the Republican side just kind of predetermined. There's there's Less of an actually principled right-leaning element of the discussion in the first place and so there's no really no discussion at all and not a That you know the compromise that results Doesn't have the benefit of the left and the right having that that kind of discussion And so you the book really helped me to kind of see How higher education probably night it has felt like that's happening All over the country and in Congress on a lot of a lot of different issues a few other things I wanted to mention really just adding to your adding to your story you talk about the Quite progressive policies of the Obama administration early on in the administration, and I just thought useful to remind people that During the transition Most of the commentary was that well, we don't really expect Obama to do much in higher education It was not it was not much a part of the political campaign That he launched And I wanted to throw out the possibility that part of the reason that Obamas was able to propose such progressive higher education policy is that he was not burdened by higher education or financial aid policies created in the heat of a campaign and when not when Folks running for office call me and say and ask me well, so what should I be proposing in my campaign? I'd say don't don't Don't propose higher education policy in a campaign because if you pull things and this is what happened with the Clinton and the tax Credits if you ask somebody would you know should we have a tax credit for higher education? It sounds great. It sounds like it doesn't cost anything You know it just sounds like a total it sounds like apple pie You know this and if you have we did focus groups a number of years ago Asking people what should what should the interest rate be on student loans and just add them You know have them write down What do you think the interest rate should be and almost everybody wrote zero or one percent which From an economic stamp a point makes no sense and basically would cause everyone to just want to take advantage of the program it's and Those are the kinds of policies that you get when when you use polling to create higher education policy so I think part of what created I Say you had the the the lack of a List of higher education policies that had been promised in the heat of the campaign and created by polling And then you had a very good candidate who really cared about higher education, and I remember Early on it may have been the transition or may have been early on in the administration And I knew that you know the things that you say during the campaign Maybe get moderated some once you have to start governing and the president had said Obama the candidate had been very much in support of the The dream act and I was about to meet with some of working on the transition team About to meet with some folks who I knew were gonna ask me so you know what about the dream act and I emailed over to one of the to Heather Higgin bottom one of the primary campaign People and said you know I'm gonna meet with these folks Can I can I say we're a hundred percent with you? We're right there, and I kind of thought you know I need to ask this because I'll probably get a response that says well, you know We don't want to come out first with that we'll get attacked as only care You know blah blah blah and it would be sort of a triangulation thing and the response I got back was yes, it was just go for it and that I mean that's what actually made me think I could Actually work for this administration. I could actually move back from California for a little while To work for this administration said the combination of not being burdened by what was decided during a campaign In terms of policy and I think a good candidate who really cared about higher education and Pell grants And was you know so bold as to as you said Propose a Pell Grant entitlement You also make the good point in the book that it's not all about money and power sometimes it's about strategy and You talk about the Sally may alternative to to direct lending and I think you're right that part of the reason that the Sally may proposal didn't get anywhere was that they didn't Strategically they had not brought in the the nonprofit the nonprofit fund loan companies And we were hearing whispers all the time that you know that there's gonna be a deal's gonna be cut that that some mystery person in the White House You know, it's just gonna happen I think another reason the Sally may deal didn't happen was The details hadn't really been worked out I mean folks look at the proposal and trying to figure out. How does this actually how does this actually work and I wanted to kind of bring to the book of that issue of details Because you say at one point in the book and I wrote down that Innovative ideas are rarely in short supply. I Think that's true except that what is often in short supply are details and Even some of the ideas that you kind of end with in in the book um Rewarding states for doing the right thing rewarding institutions for a lot of Pell Grant recipients the details about how to Implement how they actually design those sorts of things. They're good ideas, but it's in the details nobody has a detail proposal and Figuring out the details actually accomplishes two things one is it gives you something to actually propose rather than Rather than just sort of Pretending like you have an idea, but it also forces the other issue that you brought out Which is the unintended consequences to think about okay? Well if we design it this way you start realizing when you work out the details if we design it this way We might be incentivizing these other kinds of things and that's not necessarily a good thing And so perhaps some of the for you know further exploration Where do you have details? Where do you not have details? That issue of details also kind of emerges around Around some of the for-profit issues where there's a strategy about not having Details so the for-profit colleges like to say over and over again that they should be judged on outputs Outcomes rather than inputs But they never actually propose any details on what those out how those outcomes should be measured and when Anybody actually does propose any details. They scream bloody murder and act like they're being attacked Like like is happening right now And so there's actually a strategy about acting like you have an idea But then you have no details and so you get the benefit of saying well they care about outcomes But then in fact they have no no proposal whatsoever and oppose anything that anybody has actually Proposed so that difference between ideas and details. I think deserves further exploration Thanks very much to the new American Foundation for hosting this event on Suzanne Metler's important book It's also the century foundation. That's right. That's right. Yeah, the century foundation as well I just want to take a few minutes to underscore a couple of the very important books up very important points in Suzanne's book And then set them in the context of congressional politics more generally One of the really important points in the book is that policy doesn't remain static Even when Congress is gridlocked the effects of policy can change dramatically as a result of societal or economic Changes even when the laws remain the same so gridlock just means Undirected policy change. It doesn't mean a lack of change so on the subject of Direction or lack thereof It's unquestionably true that it's much harder for Congress to act today than it was in the past The US system of government with its many checks and balances and veto points almost always requires Bipartisanship to legislate Most of the important laws that Congress has adopted. It has done so on the basis of large bipartisan majorities So the problems that Congress faces today in getting bipartisan agreement are new to post war American government there should be no doubt that it's much harder today for politicians to work across party lines Than it was in the 50s the 60s the 70s even harder than in the 80s and the 90s I brought some data for you to examine on a handout Living up to the college professor stereotype, I guess The party polarization can be seen via very simple indicators like something like party cohesion the first figure that I put on your handout displays the average Senate and Senate Republican and Democratic Party unity Between 1956 and 2010 just looks at the that senator's average loyalty on to their party on Controversial issues Broken out by Democrats and Republicans separately in the 50s 60s and 70s the typical senator voted with his party on Controversial issues just over 60% of the time in the 80s just over 70% of the time in the 90s Over 80% of the time and since 2000 on average above 87% of the time The story is the same in the house as is evident there in figure two Conflict always slows Congress down and partisan conflict most of all And as partisan conflict spreads to more issues the institution's gotten progressively more bogged down as A consequence the last Congress got almost nothing done I also display a simple gauge of legislative productivity the number of public laws passed in each Congress since 1951 With the passage of only 240 laws the last Congress was the least productive of the whole time series and The current Congress is on track to underperform the the last at the end of its first session It had passed fewer laws than did the 112th It's been hard for Congress to act on anything even on low-profile Issues that have historically been bipartisan like farm bills or the postal service or Transportation policy cyber security Now scholars and journalists normally attribute Rising partisanship to ideological changes within the two parties There's no question that each of the two parties have become more ideologically cohesive more Homogenous internally and at the preferences of Republicans and Democrats Both at the level of members of Congress as well as party activists are far more distinct from one another But what's often overlooked in the focus on ideology is another factor that affects our contemporary politics And that's its ferocious party competitiveness The closeness of today's party competition is not normal in American politics In fact the last three decades have seen the longest period of near parity in party competition For control of national institutions since the Civil War That's displayed in figure four the bottom of the handout Displays a simple index of two-party competition at the national level The measure is just the average of the Democratic Party share of the two-party vote for president It's share of House seats and of its Senate seat and of Senate seats So those three indicators averaged to go the Democratic Party share and then I just display the index's divergence From a 50-50 balance so the closer the bar to zero the more competitive the decade Democratic Leaning eras are shown in blue Republican Leaning eras in red and the purple bars indicate evenly matched competition as Is evident from this measure our politics is distinctive today for its narrow and switching majorities Nearly every recent election has held out the possibility of a shift in control of one institution or another as we're looking to Senate elections this fall Looking back the period most similar to the present was the Gilded Age 17 1876 1896 this was another period of close and alternating party Majorities in Congress as well as a ferocious party conflict and low congressional productivity These change circumstances have had far-reaching effects on political incentives and on party politics This increase in two-party competition for institutional control fuels a more confrontational style of politics The competitive context motivates politicians to show how and why they're different from and better than their party opponents They have incentives to look for ways to confront the other side to draw clear distinctions The result is that the out party has more political incentive today Not to compromise on issues because doing so blurs the differences between the parties to voters But what it wants to do is to highlight the differences to delegitimize the opposition and make a case for a change in power Newt Gingrich ally and house Republican policy committee chairman Dick Cheney explained the logic behind the strategy in 1985 he said confrontation fits our strategy Polarization often has very beneficial results if everything is handled through compromise and Consiliation if there are no real issues dividing us from the Democrats. Why should the country change and make us the majority? More and more votes in Congress are staged for the purpose of highlighting the differences between the parties Lots of votes today are taken on bills that no one has any illusion about the coming law They're known as message votes Message votes are not serious efforts to legislate. They're just public relations But public relations takes up an enormous amount of time in the contemporary Congress So that's what I would say on the subject of Polarization, and it's not just ideological polarization. It's also a reaction to a competitive context that's Distinctly intensive. I also want to say a few words about the role of money in American politics The book traces the difficulties in higher education policy to party polarization and to plutocracy Meaning the dominant influence of moneyed interests in policymaking that that occurs There's no question that money's become progressively more important in American politics as the cost of campaigns Has exploded but as with party polarization part of the story is competition through control of institutions It's not that there are lots of competitive house and Senate seats It's that campaigns for the handful of races that are competitive are flooded with money because the stakes are so high The role of money is not Necessarily always counterproductive in American politics. It obviously has a class bias and a strong one wealthy people fund campaigns Politics more grounded in civic organizations and social movements would likely be more in touch with the needs and wants of average Americans But when it comes to the question of party polarization moneyed interests can have a moderating effect Reducing at least somewhat the incentives for endless partisan warfare American business writ large obviously has a great deal at stake in the functioning and success of America's system of higher education Generally speaking business interests don't get that much benefit out of partisan gridlock Partisan warfare looking beyond higher education policy The Chamber of Commerce would like to see more spending on infrastructure hospitals would like to see state governments accept the Medicaid expansion Legislatures that can't compromise can't deliver for these interests on the other side of the ledger Individual donors as opposed to business interests tend to be more ideological in their motivations Individual donors are becoming a more important part of the campaign finance landscape These are generally not middle-class people Even small donors are not middle-class people But compared to corporate interests individual donors are much more likely to donate for ideological reasons members of Congress with the sharpest Ideological profiles have some of the best track records and raising money The pressing need to seek and to raise money from this sort this source is probably an obstacle to constructive Bipartisanship in government so the effects of money on American policymaking are complicated on the one hand plutocracy means That government will be able to do at least some things albeit things that benefit American economic interests What's good for American business isn't Necessarily beneficial to the rest of the country, but it's not always harmful Suzanne Butler makes the case that rent seeking has been particularly problematic in the higher education policy scape Despite the propensity to rent seeking politicians doing things that benefit American economic interests can Sometimes be helpful to society at large But when money means cultivating donations from individual donors who are consuming a steady diet of ideological news and opinions It just reinforces all the most counterproductive incentives in American politics right now Thank you for both of you Francis do you one of the things that Suzanne argues in her book is that? You know she she focuses on higher education, but she talks about how this is happening throughout different industries Do you think that has polarization hurt? other areas as much as higher education Well, it's I certainly of the effects are spreading across issues I mean it's it there used to used to be more issues that were somewhat immune from party politics I mean historically appropriations within Congress tended to be an island of bipartisanship even had a bipartisan staff And but that's been that would came under pressure really starting in the 80s It's you know over time you know fewer and fewer issues are insulated from from party pollers I should in political science will say that more and more issues are getting absorbed into the single dimension that divides Republicans From Democrats, so yes, this has a fact this affects all sorts of issues That extend beyond higher education making it and and the primary effect is just the difficulty of legislating all together Bob you were a staff member in Congress when I first met you Back in the early 90s You worked for Paul Simon did Do you think that some of these factors were there then and also I'm interested in the change in the parties over time Have you seen that do you think that that is also true that the Democrats have shifted as well? Well, I definitely recognize I read the book definitely recognized the the dynamics and the change in dynamics and sort of that feel of of what felt like at least in the early 90s the ability to have to to have a discussion and and to Maybe reach a compromise. Maybe not reach a compromise, but at least it was a rational discussion based on Theories and proposals and ideas and it has felt more and more like You're walking into a buzz saw where the folks on the other side of the aisle are required to just You know slash and burn and Not have not have an actual discussion and that does feel like it has changed That I'd also recognized the Some changes on the Democratic side certainly the inclination in the early 90s among Republicans and Democrats was Let's keep peace with the banks And at least as far as the education committees went Let's not upset the for-profit colleges too much and I would say even even senator Simon was there and almost got into Trouble around that And That has shifted and I think I still see that in the Democratic Party, but some of the leadership at least in the Senate Has has you know become more pointed in its criticisms of the of the for-profits in ways that were not the case in the early 90s Suzanne in the book you talk about you know at one area where plutocracy Didn't occur was when there was actually student loan reform And they switched from guaranteed lending to direct lending But you talk about the fact that the polarization and the fact that it was an all Democratic reform Has heard it and I was wondering if you could elaborate on that a little bit Yeah Well first, I'd just like to say that when I started working on this book I did not foresee that we were going to be terminating bank-based lending because you know It had been such a long struggle from when these ideas emerged in a bipartisan way in the late 1980s for direct lending and then I Looked at the when Clinton introduces it I See that as a moment when polarization really became exacerbated when suddenly the waters parted and and people were Lining up on either side depending upon their party and so for a long time That sort of dynamic then seemed in place and plutocracy was operating as well because there was all of this You know a campaign spending and lobbying being done by the the banks and by Sally May and so on and trying to Prevent reform from happening, but then What was really surprising to me what I'm in the course of writing this book was all of a sudden Change became possible and you know So here's sort of the hopeful note of the book is that change still can occur We're not just bound to what political scientists will call path dependency where you get going down a certain path And then it becomes reinforced again and again and again that you can actually have a set of political Circumstances that line up and make change possible. And so that did happen You know around bank-based lending, but I think that to get to your real question that Polarization does even hurt the shape that these reforms take And so, you know in that instance It was really intriguing to me. I remember interviewing a Republican staffer on the Hill and saying well Why didn't you put forward some kind of an alternative proposal that you could have been happy with and gotten behind and This individual said to me Philosophically, we were not on board and we just couldn't go there You know, we knew that the math didn't work for the Sally May proposal But we didn't want to be part of something else. We wanted just bank-based lending That was no longer economically feasible so they didn't engage in it and so What's really left out is what Bob is talking about the attention to the details that takes Bipartisanship, I think that higher education It's so striking to see higher education become really subject to polarization because Historically, it's been an area with greater Bipartisanship and where people have been willing to get together and talk about the details Even if they had very different points of view about them to hear each other out And I think through that deliberation you come up with a better product You know, it's illustrated by another set of policies. We haven't talked about and that is the contemporary GI Bill So if you go back to the 1980s There was real bipartisanship that happened around the creation of the Montgomery GI Bill at that point in time it took seven years, but there was real bipartisan effort to come up with a good plan and Then that became outdated outmoded and it needed to be revitalized and a long time went by before that happened Finally, Senator Jim Webb led the effort for that for what became the post 9-11 GI Bill but it happened in this really different political environment and With much less deliberation about the details and so then no sooner was it enacted when it had all sorts of problems with Administration because it's just the kind of thing that you know If there'd been more negotiation ahead of time and deliberation some of those things could have been foreseen and worked out And on that one there wasn't even discussion among Democrats of different committees. I mean there was no between the Education Committee and the Committee the Veterans Committee there wasn't any communication either So it wasn't just between Republicans and Democrats Well, I think you know what happens is that people see the political moment Okay, we have an opening to get this done and then it gets rammed through in the context of polarization because you think well Otherwise all those details that window is going to shut and we will have missed the opportunity. Yeah Well, I think I'm going to open it up to the room to see if you guys have questions for the panel Wow, we've got some When I start with you over here Yeah A read I probably just put at a regional State University in the Midwest and You know our faculty are earning less now than they earned in real dollars in 1980 our students in fact our students are on the list of The students who graduate from public universities with the highest amount of debt in the country and You know, it's it's disheartening to sit here and hear that some of the problems I mean, we're facing, you know enormous cuts in state spending Tuition raising tuition is sort of the only way that the University can manage to meet its expenditures It's disheartening to sit here and hear that the problem is really over on the hill That it's you know that my students who can't afford to have an internship in Washington DC. That's unpaid you know are being basically Facing this because of things over on the hill. So my question is and I haven't read the book yet But my question is what should the rank and file do like what do you recommend the students the Professors at these universities who care deeply about higher education due to grease the wheels to You know help This situation do better for those who are simply trying to get this access And let me just point out that the regional State University has been the point of The greatest amount of access for people from underrepresented groups, right? So anyhow, thanks Thank you so much for your question, and I'm glad you're here and I think that it's you know Institutions like yours that have been particularly important historically for providing Opportunity to people and these are precisely the institutions that we ought to be concerned about and ought to be trying to Set things right so that students can attend them without going into such such debt And so that the things are functioning better than they are presently I've been talking a lot about the federal government, but in the book I also address, you know state governments and they're pulling away from Supporting these institutions in the middle of the 20th century. Not only was the federal government investing in new kinds of student aid, but meanwhile the states were Redoubling their efforts and putting huge investments into public universities and colleges And they continued to do so even after the federal government began to pull back in the 1980s But it's really been since the early 90s that at least nationwide in the aggregate that the states have been Pulling back and doing less and so I like you know the direction of your question asking about what can people do? Generally because that's really the note I end up on at the end of the book The American public gets very much left out of these discussions And there's a little bit of attention between the very good point that Bob makes that the details matter and Engaging the American public. I mean a higher ed policy quickly gets into down in the weeds kind of wonky kinds of Details and that's not engaging to the public generally the most active Organizations speaking on students behalf are the organizations representing universities and colleges But their interests are not always the same as the American public at large and people who have not become college students And so the question is really how to engage the broader public around these issues and one of the things that I Tell my students is that the period in time when lawmakers were most responsive to young people Was when young people were more active in politics if you look at the 1960s and 1970s Young people were much more active not only in voting but in a whole array of political activities And then that declined during the 1980s most of the 1990s and since 2000 there's been an uptick of young people's involvement in political participation in the 2004 2006 2008 elections and I think it's not an accident that lawmakers have become more responsive at the national level In increasing Pell grants since that time and so on I mean this is how representative democracy works that when people speak with a louder voice and make their interests known That elected officials are more responsive And so trying to revitalize that kind of civic engagement more broadly Is really important Do you have any thoughts I Want to underscore the book has some really useful data and discussion around the decline of state aid in higher ed and some of the dynamics around that And The idea of rewarding states and figuring out how to incentivize State support of higher education is absolutely critical but somebody's got to put together the details and then rally a coalition around supporting it and Unfortunately that hasn't happened and But it would I think that's a really important step that needs to be taken Maybe a bit of a focus on state government also would be appropriate here It's hard to be optimistic when you look at the constellation of Political incentives surrounding surrounding Congress itself and this point about details versus what it what speaks to the broad public I think also intersects with the way in which party competition Leads Congress to pay less attention to details I mean these message votes are designed for public consumption. They're not serious. They'd lack details They're not staffed out there. These are not real policy proposals. They just look like them And so when when you're engaging in campaigning instead of efforts to govern then the details don't matter as much And so we're seeing less of a focus on details because of the the the continuous and pressures of campaign incentives Okay back there Thank you, I'm curious about what you your thoughts on the Obama administrations proposals to sort of reform How federal student loan aid is given to schools, you know talking about using metrics like gainful employment curious about your thoughts both in general, but also Any ideas you might have about what unintended consequences might result. So for example, dr. Mellor, you talked about You know universities sort of trying to game this certain metrics in terms of things like rankings that sort of thing So I wonder about you know, if new metrics were we're tied to to things like federal student loans like what what results You might might think what happened. Thank you Okay, so thank you for your question about these the proposed rankings I imagine there are a lot of you in the room who are spending a lot of time thinking about these rankings and Are imagining the unintended consequences that might emerge from them and And I should say, you know, that's not my expertise and I I don't really go there in the final chapter But really make more calls more broadly about how we need to to focus on higher ed in a new in a new way But I do think on the on the one hand. I think the rankings are Motivated by the right things in that as I've been saying we need to the federal government It's right for the federal government to hold Institutions across sectors accountable because they get a lot of federal student aid dollars and because they're part of a big national mission to extend higher education and so that's appropriate How it's done the details of course is where it gets complicated and we need to think about Which kinds of indicators can we actually measure in a meaningful way and so on? my suggestion on ratings was Just basically have a have a warning have a warning if a college doesn't reveal who its faculty are Have a warning if a college refuses to release to the public. It's accreditation self-study and visiting team report and have a warning if someone is being asked to pay tuition that is more than Double the amount that the institution spends on instruction, which is a data point that exists right now and the federal government has it So that's what I do tomorrow Thank you very much actually be great if people say where they're from sure Good this is on Fred winter from FA winter associates While we're talking here The Department of Education is preparing the finalization of the guidelines for a new 75 million dollar funding opportunity Called first in the world designed to focus on college success, which is understood pretty much to be college completion What are your fears that the new funding opportunity might do that would reinforce the negative trends that you're seeing What are your hopes that it might include that would reverse them? Thank you for the question though. I have to confess. I'm not familiar with this particular initiative So I can't speak to that Well You know We need funding but we have to be careful about how we spend it and so I would want to look carefully again at those at the details and Looking at Spending it at institutions that have a good track record for college completion and then for institutions that don't Looking at what the federal government can do to try to incentivize them to find better college completion rates We haven't mentioned at all community colleges today and Often students who are going to for-profit colleges could be getting the same training Same preparation for gainful employment at a community college at a much lower price and without becoming so indebted but community colleges have been dealing with very scarce resources and I think that we really ought to be looking for ways there were some proposals that had been floated around in 2009 and 2010 that ultimately didn't become part of the student aid bill that was enacted that could have done more to incentivize the community colleges to experiment with new approaches that are great for college completion rates I think we ought to be looking more at strategies that help Ensure that then students transfer on to go and finish their bachelor's degree and so on Okay Right right there Richard Cullenberg with the Century Foundation. So this is the terrific panel. It it's a little discouraging though, of course that that there We haven't been able to make efforts Successful in a number of different areas with the tax credits the for-profits State expenditures on higher education and and Bob your your success is kind of the one shining example of where everything came together and we obviously had control Democrats had control of both houses of Congress and And we had Bob who was fighting for direct lending But I'm wondering Suzanne if you can talk about or I guess all the panelists if you could talk about What lessons there are there and how they could translate? The six how the success in the direct money could translate into into those other three areas Well so so I do I have a chapter in the book that I call opportune moments and This is about what happened in 2009 and 2010 that That made things come together after long efforts to move to 100% direct lending what helped it to happen So one of the things that really helped to make this happen, of course was That the bank-based lending was no longer Financially feasible and that became very clear after the economic downturn and then there was new political will and new political leadership because of the Obama administration's efforts and and the Democratic majorities that were on board with with that on the Hill and there had also been Revelatory stories in the media that made the public more aware of the problems that were happening with bank-based lending So all of those things came together and we sort of we know in political science that when you know at what we call a Policy window window of opportunity opens. It's usually Some of those kinds of circumstances coming together of changes in social and economic and political circumstances that that line up So the question is moving forward. How do you try to? Create that sort of window of opportunity I really think that Higher education is an area that you know as I've said not so long ago We had bipartisan of willingness to work together on issues and that we ought to be able to regain that It shouldn't be as hard as it might be around some other issue areas and that the Need to do so is really compelling and so that has to be a first step Engaging the broader public as well critically important And I think we can't underestimate how important it is for the public to understand more broadly What's going on in these issues that for I'm sure people in this room are very well aware of many of these trends I've spoken about but when I go around the country and talk about this people's Jaws drop open when they hear some of the statistics that I'm giving you and it's really news to people And so I think the word hasn't gotten out It's important for people in the policy community to keep working Because when those policy windows open they're not open for very long And if you don't have ideas that are ready to go you can't take advantage of them So to keep pressing on in spite of depressing circumstances so that you are ready Can I repeat exactly that so that is the number one? Issue is that so many folks working in policy just kind of are sitting and going gosh I hope things will get better because then we'll get some then maybe we can work on good policy Then when the window opens and you don't you don't open the window the window opens You can't predict when the window is going to be open the people with ready Policy proposals are the ones that can get them through that window of opportunity and a ready policy proposal means Details it means a coalition it means of people you know going around to the folks who might support it when they and When at the Institute for college access and success in 2005 when we launched We went around all the folks in one Dupont circle and said we want to improve income we want to make an income-based repayment program that that works a lot better and basically almost every person we talked to said You know the timing isn't good And and too bad and you probably can't get you know you can't get anything done You know all that and they just said you know why bother we worked on it anyway And we built a coalition around it and within two years a window of opportunity that no one could have predicted Opened up and there and there it went and we've ever since then been building on that and So even if things look bleak work on the details build the coalition Figure it out so that when the window opens you can go for it More questions mark Hi, I'm Mark Schmidt. I run the political reform program here at New America One one of the reasons I got interested in issues of political reform was from working on the hill in the early 90s and the Kind of periphery of the direct lending fight that Bob was the the leader on and seeing how the seeing the dynamics of the political debate So it's great to see where it's come I think it's fascinating to think it to think of these issues in terms of something that was a success and a Breakthrough in this political climate. I mean we're so used to think you know, we study a lot of failure And this is a reminder of something where I think we all assumed that there was going to be Kind of a long stalemate around the for-profits and the for and the student loan industry It's fascinating how it broke through But I'm struck by the fact that there's a whole other dimension of higher education that seems to be more powerful and more influential than ever Which is really just the large public and private universities with enormous lobbying presences here in Washington not much challenge to their Administrative cost that you know, they're continual, you know huge federal funding for those for those institutions And I wonder if you have any thoughts about you know, really what you call one Dupont circle any any Possibility of a breakthrough on really thinking about Cost and quality of higher ed in the in the federal role out beyond the for-profits and the and the bank-based student loan lenders This thank you for your question So in the book I I touch on those kinds of issues lightly. I do think that The organizations that are part of one Dupont circle which represent both the the public and private nonprofit institutions or traditional higher education You know as they can have Priorities that overlap with those of the American public broadly but in the main What they exist to do is to protect their institutions And so they'll be in favor of something if it does that And so there are probably ways in which you know, they need to be challenged and it more broadly the institutions they represent need to be challenged and And that's where I think that it's appropriate for the federal government to be looking at You know the real variation that exists in the group degree to which different states Run their public universities and colleges in ways that expand access or fails to do so and that Expand graduation rates among people across the income spectrum of fails to do so and the same for the private nonprofits So, you know that invites a discussion about all sorts of details And and it's not where I go in the book, but I think that needs to happen Just a reminder that most people are attending regional public Universities that are not spending any more on a per student basis than they spent 20 or 30 years ago And I go back and forth on how much to worry about this sort of top 2% problem, which a lot of You know the New York Times Reader worries about college are about colleges that most people don't go to you know the cost of the fact That they're being asked to pay 45 50 thousand dollars in tuition at Princeton in some case in some ways I'm like I don't care. I Don't care if they're they were happy to pay fifty thousand dollars of tuition Why do I care on the other hand? I do care about the fact that Princeton's not enrolling very many low-income students or I probably should have picked a different one Princeton might be better. I'm not sure but in any case In any case, I think those are where Certainly some policies could be developed around Especially some of the most selective Public and private institutions that are spending enormous amounts per student and are not in not Enrolling America there. They are very elite and That's where we need some Specifics because I think it is an issue that a lot of people care about at the same time I don't want to get tied up. I don't think a hundred percent I think sometimes too much of the discussion is about that rather than where most people actually go Any more questions? Brian Newman Abington strategies Dr. Miller. I wonder if you can offer some thoughts on state Initiatives recent state initiatives particularly in Oregon and Tennessee To provide free tuition At some post-secondary institutions in those states Yeah, so thank you for your question And I know that you know some states are considering this or moving in the direction of no public tuition And you know in the main this is what we Would be really fantastic for low-income students would be to have Those kinds of opportunities in In institutions where they're able to get a good education I think that You know with any policy proposal one needs to look at to think try to think ahead about Are there unintended consequences here or the things about this that could be? Problematic and so you know that that's not something that I've given a lot of thought to but My overall message of this book is that we ought to be thinking creatively outside of the box about solutions like that, but that we also should should subject them to the kinds of Questions that Bob is mentioning about being careful about the details and thinking about issues of policy delivery and administration Okay, any any more questions Well, I want to thank everyone for coming out today It's been a great panel and I also want to encourage people to To take a look at Suzanne's book. They're selling it right outside here and thank you very much for my panel Thank you so much