Thread by @Headsnipe011

Sorry I missed this yesterday

U.S. Secretary of Education Betsy DeVos Warns of Looming Crisis in Higher Education

@MAGAREX1 @drawandstrike @HNIJohnMiller @catesduane @rising_serpent @almostjingo @tracybeanz @TheChiIIum @hfinch63

ed.gov/news/press-rel…

ATLANTA—U.S. Secretary of Education Betsy DeVos raised a red warning flag today for America's students and taxpayers regarding what she called, "a crisis in higher education."

In remarks she delivered at the annual Federal Student Aid (FSA) Training Conference in Atlanta, Secretary DeVos called America's higher education system "the envy of the world" but warned that if significant policy changes aren't made to...

the way student aid is distributed, administered and managed, "the program on which so many students rely will be in serious jeopardy."

The Secretary then laid out four core principles from which decision makers can start when taking action to address the problem:

"First, people—human capital—are our greatest national resource. It's in our nation's interest to support individual students' interests, to support their potential, their creativity, their destiny.

Every person should have the opportunity to pursue the education that's right for them. And so, supporting and encouraging a multitude of pathways makes common sense.

"Second, innovation must be unleashed. If it is, it will advance opportunity, efficiency, and results in education as it has in every other industry.

"Third, better, more accessible information is necessary for policymakers, for students, for parents, and for taxpayers.

"And finally, nothing is free. Someone, somewhere ultimately pays the bills."

Additional Speech Highlights

The myStudentAid mobile app

There were plenty of folks who declared it could not be done. They said the Department was "overpromising what it could deliver."

That what was required was "overwhelming" ... the time frame was "impractically" ambitious. ... Today, the app makes it easier for students to complete their FAFSA. In the near future, a student will be able to see how much he or she owes at any moment in time,

what repayment options are available, and how those options will impact the total amount owed over time.

Financial literacy

One major goal of the NextGen initiatives is to facilitate a partnership with you to improve student financial literacy.

***YES!!!***

Imagine how students would benefit if they could easily and continually plan and budget for their education, if they could seamlessly access personalized insights about the outcomes of the program they are considering or in which they are enrolled.

Think about the power of having hard numbers, and how having that information could help a student make more informed—and better—decisions.

We are working to bring new tools like these online soon, so that in partnership with you, we can all fulfill our charge to help students earn their degrees and be positioned to succeed when they enter repayment.

A crisis in higher education

I'm here to raise a warning flag with American students and American taxpayers: We have a crisis in higher education.

Our higher ed system is the envy of the world, but if we, as a country, do not make important policy changes in the way we distribute, administer, and manage federal student loans, the program on which so many students rely will be in serious jeopardy.

... Federal Student Aid was established to come alongside students who lack financial resources to pursue higher education. Since its first iteration in 1965, however, it has outgrown its structure and its governance.

That reality has increasingly significant implications for American families and the American economy.

... It took 42 years—1965 until 2007—for the student loan balance to grow to $500 billion. It took only six years for the loan balance to double to $1 trillion in 2013—one-seventh the amount of time it took to get to $500 billion.

And today, only five years later, FSA holds nearly $1.5 trillion in outstanding loans.

... Only 24 percent of FSA borrowers—one in four—are currently paying down both principal and interest.

... As for FSA's portfolio today, too many loans are either delinquent, in default, or are plans on which students are paying so little, their loan balance continues to grow. Ultimately, 43 percent of all loans are currently considered "in distress."

... These loans aren't just financial products. They represent students and families "in distress" with very real implications for our economy and our future.

... Since 2010, when the previous administration orchestrated a government takeover of student lending, FSA's portfolio has skyrocketed.

Over 8 percent annual growth. Two times faster than the growth of the cost of attendance and almost four times faster than the growth of our economy.

Finding solutions

Here are a few principles I think are important as we look to solutions.

First, people—human capital—are our greatest national resource. It's in our nation's interest to support individual students' interests, to support their potential, their creativity, their destiny.

Every person should have the opportunity to pursue the education that's right for them.

And so, supporting and encouraging a multitude of pathways makes common sense. We shouldn't imply or decree that one, traditional pathway is the right thing for everyone.

Second, innovation must be unleashed. If it is, it will advance opportunity, efficiency, and results in education as it has in every other industry.

Third, better, more accessible information is necessary for policymakers, for students, for parents, and for taxpayers.

And finally, nothing is free. Someone, somewhere ultimately pays the bills.

... Each of us has a contribution to make and a role to play in resolving our present crisis in higher education.