Inequality Matters: Bachelor's Degree Losses among Low-Income Black and Hispanic High School Graduates. A Policy Bulletin for HEA Reauthorization
Author: Advisory Committee on Student Financial Assistance
Date: 2013-06-00
Type: Information Analyses
Subjects: Bachelors Degrees,High School Graduates,African American Students,Hispanic American Students,Low Income Groups,Educational Policy,College Bound Students,Enrollment Influences,Enrollment Trends,College Admission,Paying for College,Financial Problems,Declining Enrollment,Graduation Rate,Equal Education,Educational Attainment,Racial Differences,Access to Education,Statistical Analysis,Generational Differences

The Advisory Committee's 2010 report, &quot;The Rising Price of Inequality,&quot; found that need-based grant aid from all sources was inadequate by examining the enrollment and completion rates of low-income high school graduates who seek to earn a bachelor's degree and are qualified to gain admission to a 4-year college. The major finding was that the rates were declining rapidly. The impact of this trend can be seen in Census data, which show that educational attainment of 25- to 34-year-old Americans is now lower than the level of their peers who are 35 to 44 years old. To inform reauthorization of the Higher Education Act (HEA), this bulletin extends the findings of the Committee's 2010 report by focusing on the enrollment and completion of low-income Black and Hispanic high school graduates who had taken at least Algebra II and could gain admission to a 4-year college. There are five findings: Financial Concerns, Enrollment Shifts, Declining Completion Rates, Bachelor's Degree Losses, and Increasing Inequality. In its 2010 report, the Advisory Committee recommended that need-based grant aid from all sources be increased. In particular, the 2010 report cautioned that the steady erosion in the purchasing power of Pell Grants must be reversed if any progress is to be made in ensuring equal educational opportunity and success in higher education. Without such increases, inequality in access and degree completion will steadily worsen--as will inequality in national income. The foregoing findings have important implications for HEA reauthorization and the evaluation of proposals to redesign federal need-based grant aid. The likely impact of such proposals on these considerable losses and escalating inequality of opportunity must be considered. Five proposals currently under consideration deserve special scrutiny: (1) Denying Aid to Students Based on Risk of Non-Completion:Denying such students the grant or loan funds necessary to meet rising college expenses, based on risk of non-completion, will discourage enrollment, drive students toward higher cost private loans, and undermine persistence and completion; (2) Demanding Budget-Neutral Funding of Title IV Student Aid: At a minimum, policymakers should require that proponents show how access and completion can be held harmless under budget neutral funding; (3) Eliminating Pell Grants to Fund Block Grants to the States: Policymakers should demand that proponents show the redistributive impact on students and institutions of replacing the Pell Grant program with block grants to states or institutions (ACSFA, 2012a); (4) Dismantling Partnerships in Need-Based Student Grant Aid: Proponents of decoupling must show policymakers that doing so will not greatly worsen access, completion, and national income inequality (ACSFA, 2012b); and (5) Relying Exclusively on Improvements to Student Aid Delivery: While improving information and further simplifying forms and processes are constructive, and can lower frustration of at-risk students, doing so will not reverse the bachelor's degree losses projected in this bulletin. Substituting delivery system improvements for need-based grant aid cannot neutralize the impact of rising college prices.