Overpromised, Underdelivered: The Limitations of the Department of Education’s Transparency Efforts
Over the past few years, the Trump Administration has reversed course on a number of initiatives set forth by the previous administration to hold institutions of higher education accountable for the outcomes of their students. Rather than stopping the flow of federal grants and loans to higher ed programs where students are unable to earn enough to reasonably pay down their educational debt, the Administration has instead proposed a new solution: provide more transparency within the higher education marketplace in the hopes that this information alone will prevent students from attending postsecondary programs that ultimately leave them worse off.
Specifically, in May 2019, Secretary Betsy DeVos touted an expansion of the College Scorecard as an equal substitute for the rollback of Gainful Employment regulations, which were put in place to hold career-education programs accountable for the debt and future earnings of their graduates. In its initial release of program-level data, the Department provided information on the average loan debt for those who majored in different programs at institutions across the United States. And President Trump has promised to expand on this by releasing earnings data by the end of the year.
The idea is that if every prospective student knew how much they would have to borrow and how much they would likely earn, they would “vote with their feet” and attend institutions and programs with better outcomes. Therefore, the Gainful Employment rules could be scrapped.
Even if this were to play out, the data that the Department released as part of this effort so far are underwhelming, to say the least. Out of the 194,575 higher education programs across the United States, only 42,430 (22%) have information available on the median loan debt of graduates. Furthermore, the data that was released hides the outcomes of certain types of programs more than others. Certificate (non-degree) programs across all colleges were previously subject to proving their value to students under the Department’s Gainful Employment regulations, which also included such requirements for for-profit degree programs. But the Department’s preliminary data included information on less than one out of every 10 programs that resulted in either undergraduate or graduate certificates. Therefore, students wishing to consider the other 44,000 programs that fit these criteria will be left in the dark, forced to make their decisions without good information about their prospects.
To be sure, there are other flaws with higher ed data that remain outside the Department’s control. For instance, federal law prevents the Department from providing employment outcomes for students who attended an institution yet never received a federal grant or loan. As a result, nearly a third of students will be left uncounted in earnings data promised by President Trump. Measures like the College Transparency Act, a bipartisan bill gaining steam in both chambers of Congress, would fix this loophole in the law. But in the meantime, the data is still very incomplete.
If my time at the Department taught me anything, it’s that transparency is critical, as it shines a light on how well institutions serve their students. However, it is in no way an equal substitute for actually holding institutions accountable for the outcomes of their students and kicking the worst programs out of the system—a fact which is all the more true if the underlying data fueling this approach excludes information on nearly four-fifths of all higher education programs.
Neither the data on debt for the subset of programs where information is available or a subsequent release of program-level earnings data will do enough to deter prospective students from enrolling in low-performing and, sometimes, predatory higher education programs. Nor will it guarantee a return on investment for the $120 billion in federal student aid that’s used to fund those endeavors. That’s why it’s important to do better than we are on transparency but also ensure it is paired with strong federal guardrails since sunshine alone is not a sufficient disinfectant.
The “close your eyes and hope for the best” approach that Secretary DeVos is taking with billions in federal funds and millions of students’ futures on the line is unlikely to improve our higher education system, especially if the worst-performing programs remain open for business with their data hidden from prospective students.