Clinton: ‘Higher Education Institutions Are Pricing Themselves Into America’s Decline’

Editor’s note: The Wonk Room is reporting from the Clinton Global Initiative conference this week. This is our first post.

This week, the fifth annual meeting of the Clinton Global Initiative (CGI) — a movement by former President Bill Clinton to bring together businesses, world leaders and a variety of NGO’s — is taking place in New York City. Prior to the meeting’s official kickoff today, I took part in a briefing with Clinton and ten or so other progressive bloggers, to discuss CGI and a wide range of policy questions — from the best way to encourage sustainable farming in Africa to besting China in electric car development.

One of the main thrusts of this year’s CGI conference is discussing ways to build up human capital through public and private investments. This is particularly important here in America, as our educational attainment has stagnated, and we have lost the competitive academic edge that we used to hold over the rest of the world. Clinton touched on this, lamenting our falling academic standing:

In the last eight years, we went from first to tenth in terms of the percentage of 25-34 year olds holding a bachelor’s degree. That’s the most important unknown statistic out there…We are headed into long-term economic decline if we don’t do something about it.

He added that prohibitive tuition at college is contributing toward this problem, as “higher education institutions are pricing themselves into America’s decline.” Indeed, this is a real problem. As Michael Mandel at Economics Unbound pointed out, “college costs are up by 23 percent since 2000. But real pay for young college grads is down 11% over the same period.” Meanwhile, two-thirds of today’s college students borrow to pay for tuition, and their average debt load is $23,186.

“We’re soon going to have to change the delivery system in higher education,” Clinton said, noting that 17 states have authorized community college to offer four-year college courses and credits. The Senate passing the student loan reform package that the House approved last week would also be helpful (although that doesn’t get at the root cause of the problem, which is the price increase in the colleges themselves, which consistently grows faster than the rate of inflation).

We currently have a higher education system that is delivering less and less, but costing more and more. And if that trend continues, America can only continue to lose ground on the rest of the world.