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January 28, 2013

The American Dream 2.0, New Report Recommends Federal Student Aid Overhaul



In the 1950s, the "American Dream" consisted of a black & white television (a color TV for the one lucky guy at the end of the block, who nobody liked anyway), a white picket fence, a beautiful or handsome spouse, a ranch-style home, and 2.5 children (of course, even that half-child ate more breakfast cereal than you believed one teenager capable of consuming).  Today, the "American Dream" may be to simply find a job that pays enough to cover your student loan payments, fill the gas tank on a small car, and spring for a bi-weekly latte (no half-kids here).  To achieve even that revised American Dream, you will most likely need a college degree and for most, that means student loans.

On Thursday, HCM Strategists, a public policy consulting group made up of higher education experts including college presidents, foundation leaders, and elected officials, published a report calling for sweeping changes to simplify federal financial aid.  The white paper, "The American Dream 2.0," deplored college completion rates (nearly 50 percent of all first-time, full-time students fail to graduate within six years) and called for greater transparancy of the federal student aid system.  One of the report's more controversial recommendations was to require colleges to link aid "to the extent possible" to outcomes for students and graduates, in essence tie federal aid to completion milestones and not simply enrollment, thereby increasing pressure on colleges and universities to provides tools and resources to students to keep them on track toward attainment of their desired credential or degree.

The report is part of a larger effort led by the Bill and Melinda Gates Foundation to recommend changes to financial aid to increase college completion rates.

Read the report here.

By James | Category: Student Debt, Higher education funding  
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