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Thanksgiving in Columbus?

Brendan Cantwell
Brendan Cantwell
THE Ohio State University recently announced a plan to make an education at OSU debt-free for all students within a decade. The goal is warmly received and for good reasons. But I’m not as thrilled as you might think, and not just because the Buckeyes trounced Michigan State (my employer) on the football field. Believe it or not, without a national fix, I worry that plans like this one will increase inequality.

How debt free college increase inequality
Kristina Johnson, OSU’s new president, has an ambitious plan to make undergraduate education at the high enrollment public research university debt-free for all undergraduates. The program relies on a robust fundraising effort. OSU anticipates needing $800 million in donations to run the program, backfilling tuition revenue derived through student loans. It’s a big lift. But billion-dollar development campaigns are relatively common these days, and I anticipate OSU will exceed the target. I doubt a savvy higher education executive like Johnson would announce the plan if the university didn’t have a path to pulling it off.
As you might expect, the news has been well received. Trevon Logan, Distinguished Professor of Economics at OSU, described the plan as a game-changer. Dr. Logan’s enthusiasm is widely shared. And I can’t argue; the plan is a game-changer.
Eliminating the burden of debt is a big deal for low-income students. OSU enrolls nearly 47,000 at its Columbus campus, most of whom are from Ohio, and many come from families that struggle to afford the tuition. Because the OSU plan applies to all students, many from the middle class and even relatively affluent backgrounds, but who nonetheless need to borrow to cover costs will benefit. Without a doubt, the plan stands to help many students and could have lasting benefits on their lives. I’d go so far as to say that it could boost the economy of Ohio. So, again, it’s a big deal.
The OSU plan isn’t the only plan like this in the country. For example, the University of Michigan offers debt-free education to students from modest-income families, and several wealthy private colleges and universities have a debt-free policy. But they tend to be highly selective and have low enrollment. What makes OSU notable is that its one of the largest universities in the country and because the debt-free plan applies to all students.
Of course, debt-free plans are not a panacea. While OSU will not include student loans as part of financial aid packages, some students will still borrow. And, as the always wise higher education scholar Nick Hillman explained to The Chronicle, “The skeptic in me says you could go debt-free by enrolling a lot more wealthy students.” Nick is right. But I have an additional concern.
Not many colleges can pull off a plan like this. Ohio State is a large public university that services a much broader swath of students than the private campuses with debt-free programs. But it is still relatively selective. According to my calculations of IPEDS data, the average 4-year institution admitted 67.5% of students in 2019, and the median admit rate was 71%. OSU accepted about 54% of all applicants, which means it’s more selective than about eight of ten campuses. As a result, getting into OSU isn’t a sure bet. And the debt-free plan will likely increase applications to the campus, which will probably make it even more selective. And while OSU is much more socioeconomically diverse than most Ivy League colleges, it does not serve a high proportion of low-income students compared to the national average. On average, 37% of students at 4-year campuses are Pell-eligible, but only about 20 percent of OSU students are eligible for the need-based grant. Pell eligibility is not a perfect metric, but it indicates that OSU students are somewhat better off on average than all students.
So, what am I getting at? While OSU’s plan will help many students, and on its own, is excellent; it also ups the ante to getting into a place like OSU. If the program works, you can expect other relatively wealthy and selective public research universities to do the same. But many, many other campuses - those that have lower status, less visibility, smaller networks, and fewer resources - are probably not going to be able to do the same. As a result, loans will stay a big part of the financial aid mix at most colleges. Because OSU and likely most of the campuses that follow them serve somewhat advantaged students relative to all students nationwide, the benefit of debt-free college will be concerned among the haves, and borrowing will become more concentrated among the have-nots. Because no loans (or fewer loans) will allow OSU graduates to accumulate wealth quicker, they will likely have better outcomes (or at least be able to make more life choices with fewer constraints). They will prosper and thrive compared with graduates from colleges and universities unable to provide debt-free education. This will increase inequality overall. That’s my guess anyway.
We are okay with it because we believe in meritocracy.
Why do we love the OSU plan? We love it because it’s good and it will help a lot of people. We love it because it’s at a massive public university that is not hyper-selective. We think it’s the right thing to do. And in so many ways, it is. But we also love it because we agree with meritocracy. If someone can get into OSU, we assume they deserve a debt-free college education. Most of us won’t go so far as to say that folks who go to colleges that cannot afford the debt-free package deserve to go into debt. But we are comfortable enough to let those students get into debt. So we will celebrate what OSU is doing without dwelling on what I see as the reasonably anticipated consequence of more inequity based on where someone gets into college. If students who go to OSU deserve a debt-free college, then all students deserve a debt-free college. And for that, we need public policy, not charity.
OK enough.
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Brendan Cantwell
Brendan Cantwell @@cant_b

Associate Professor @HALEatMSU and Joint Editor-in-Chief for Higher Education ( Speak only for my self.

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