How to Restore Federalism and Return Government to the People: Eliminate Federal Grants to the States
THE UNITED STATES FACES two major problems today: runaway spending that threatens to bankrupt us and a Congress that appears unable to deal with long-term problems of any consequence. A significant source of each is a category of federal expenditures that has somehow escaped the notice it deserves. I refer to federal grants to state and local governments that have soared from $24.1 billion in 1970 to an estimated $640.8 billion in 2015. Grants-in-aid programs now absorb major portions of congressional time, thereby diverting Congress from its core national responsibilities, and they expend extraordinary amount of money on objectives that are the constitutional concerns of the states. They also come freighted with detailed federal directives that deprive state and local officials of the ability to meet their own responsibilities in their own ways and undermine their citizens’ ability to ensure that their taxes will be used to meet local priorities rather than those of distant bureaucracies.
Congress’s infatuation with grants programs has its source in a series of Supreme Court cases dealing with the Constitution’s Spending Clause, which authorizes the federal government to collect taxes with which “to pay the Debts and provide for the common Defense and general Welfare of the United States.” The Court has construed the general welfare language as allowing Congress to “induce” states to accept federal directives regarding matters that fall within the states’ exclusive constitutional authority and that Congress itself has no power to regulate. The inducing takes the form of offers of federal subsidies for a vast range of state activities. If a state accepts the offer, it is bound by the regulations that come with the money. The states are free to decline the subsidies, but experience has demonstrated that “free” money is extraordinarily hard to refuse, however onerous the attached conditions.
Uniform federal rules deny states the ability to respond to local conditions as they would if free to handle the work their own way, and to the degree that state officials serve as implementers of federal policies, their citizens are effectively disenfranchised.
Those conditions can be onerous indeed, but they are by no means the only burdens that attend the acceptance of federal funds. To cite just a few, grants-in-aid programs add a costly layer of administrative expense at the federal level as well as increasing administrative costs to the states. The use of federal money triggers a host of mandates (such as the obligation to pay union wage scales on construction work financed with federal dollars) that can add substantially to what a state would spend on a particular project if it were using only its own money. Uniform federal rules deny states the ability to respond to local conditions as they would if free to handle the work their own way, and to the degree that state officials serve as implementers of federal policies, their citizens are effectively disenfranchised. They no longer have a voice in the design and management of projects that can have the greatest impact on their lives. And the proliferation of grants programs imposes major costs on Congress itself.
Senators and representatives are public servants, but they are also human beings who are subjected to the ambitions and temptations that are part of our nature. They have discovered that the Court’s construction of the Spending Clause provides them with the easiest way to ingratiate themselves to constituents and ensure their own reelection. They can now focus on their constituents’ most immediate concerns which, in the nature of things, will involve such parochial matters as the condition of local roads, the education of their children, and the safety of their communities—matters that are the immediate responsibility of their state or local officials. And so they respond to those concerns by introducing legislation that will authorize transfers of federal money to the local highway commission or school or fire department—subject, of course, to regulations that Congress itself has no direct power to impose. Creating grants is not only politically rewarding; it is safe. Few will object to a proposal for such motherhood issues as care for the homeless or better nutrition for kids. But any politician intrepid enough to propose a one-dollar reduction in Medicare payments in order to avert the program’s bankruptcy will have AARP’s 40 million members calling for his scalp.
To cite an example of the Spending Clause incentives at work, within weeks of his election, my newest senator (and former congressman) began taking one-hour weekend bus trips in his state so that he might strike up conversations with ordinary citizens in what he referred to as an “informal environment.” According to the newspaper story reporting on one of those trips, his fellow riders expressed concerns over low wages (he advised his listeners that he favored raising the federal minimum wage to $10, one dollar more than the scheduled Connecticut minimum), the difficulties of finding jobs, the high cost of education, and the need for more affordable housing—the same concerns they would have expressed had they been in a conversation with their governor or mayor. One woman informed him that she depended for a third of her income on a bus that operated until midnight thanks to a federal grant that would soon expire. The senator assured her that he favored its continuance. As he told the reporter, “I heard loud and clear how significant extended bus hours are,” and on his return to Washington I have no doubt that he did his best to ensure that the federal grant would be renewed. Apparently none of the riders raised questions about the Middle East, or immigration law, or Medicare reform, or other issues that only a federal senator could deal with.
From my senator’s perspective, this was an enormously productive trip. That one-hour bus ride earned him a favorable newspaper story and will consolidate a reputation for ministering to his constituents’ concerns. As one of them remarked, “He could be at home relaxing. Instead he’s on a bus trip with us.” Of course, he might also have spent the time studying what he and his colleagues might do to address a host of problems that lie beyond the power of governors and mayors that only Congress can address. I am not criticizing my senator. He is merely playing the current congressional game, and doing so with energy and imagination. My problem is with the game itself.
If I had been on that bus, I would have expressed a very different set of concerns, not because I was any wiser than my fellow citizens but because over the past 44 years my work has immersed me in questions of national policy that only members of Congress can address. Had my senator asked me, I would have told him that my greatest worry was over the future the little girl seated across the aisle from us will face if Congress fails to screw up the courage to address our deficits and the runaway costs of our entitlement programs. In time she and her playmates will be faced with economy-crushing levels of taxation and/or savings-destroying rates of inflation if Congress fails to act. That is the sort of problem my senator and his colleagues in Washington should be concentrating on, not matters like bus schedules that governors and mayors are far better able to address.
Congress’s current dysfunction is rooted in its assumption, over the years, of more responsibilities than it can handle. As a result, its members now live a treadmill existence that no longer allows them time to study, learn, and think things through.
This is not to disparage a U.S. senator’s interest in municipal bus schedules, but the brutal fact is that we face a host of critical problems that only Congress can address. For years, both sides of the congressional aisles have known that the trajectory of entitlement spending will soon reach a point where we will be unable to honor the promises made to the elderly, a trajectory that left unchanged will soon reach unsustainable levels. They know that within 15 years the Medicare trust fund will be exhausted and that within another three the Social Security fund will be as well. Yet nothing has been done to adjust programs designed 50 years ago and 80 years ago, respectively, to meet 21st century demographic realities. There is a broad agreement that our corporate tax rates need to be reduced if our businesses are to remain competitive in a global economy and that this can be done without a loss of revenue by weeding out the favors to special business and other interests that litter our tax codes. Although individual members of Congress have developed practical approaches to both entitlement and tax reforms, nothing happens. Administrative agencies run out of control, but congressional oversight committees seem unable to rein them in.
Congress’s current dysfunction is rooted in its assumption, over the years, of more responsibilities than it can handle. As a result, its members now live a treadmill existence that no longer allows them time to study, learn, and think things through. Instead, they substitute political reflex for thought. To compound the problem, their eyes are now so fixed on their particular political bases that they hesitate to make the compromises that the legislative process requires, and to ensure reelection, they avoid coming to grips with the divisive issues whenever they can. When members of Congress do manage to enact a complex piece of legislation, they no longer have the time or patience to attend to all the minutiae that responsible legislation requires. Instead, they pass the messy details along to federal agencies, which spin out the regulations that will give the law shape. So no one, including those who drafted those laws, really knows how their handiwork will affect the real world until the regulations have been issued and put into effect.
The federal grant-in-aid programs’ costs in dollars, costs in misdirected priorities, costs in overlapping administration, costs in rigid one-size-fits-all regulation, and the citizens’ loss of control over government actions that most directly affect them should satisfy any objective observer that they represent the most misguided means of providing public services that lie within the states acknowledged areas of competence. It is time that Congress kicked the habit.
I propose that Congress immediately terminate all federal programs that offer grants to states and their subdivisions. I emphasize the “all” because if any exception is made, members of Congress will be encouraged to launch a new generation of grants on the assurance that theirs will be exempt from all the problems and costs that we find in federal grants today, and it would take another generation to prove them wrong.
Because federal grants currently constitute more than 30 percent of state revenues, Congress cannot cut off the flow of federal money overnight. Therefore, I propose that it terminate the grants by converting them into single no-strings-attached block grants, one for each state, that would be phased out over a period of five or six years. That would allow ample time for Congress and the states to adjust their respective tax codes to accommodate the successive reductions in the federal transfers. Increases in taxes paid to the states would be offset by reductions in the money taxpayers send to Washington. This may sound like a formidable task, but it shouldn’t be. Washington and the states derive their tax revenues from the same sources—the individuals and businesses located in the 50 states and the District of Columbia. It will merely require adjustments in the destinations of their tax payments.
If Congress adopts this proposal, it will phase out over $700 billion of current federal expenditures (the $640.8 billion in federal grants estimated for FY 2015 plus an estimate of more than $60 billion in federal administration costs) and take a major step towards balancing the nation’s books. It will also eliminate the substantial costs associated with the overlapping federal and state administration of those programs, take a giant leap towards restoring the allocation of governmental duties envisioned by the Constitution’s framers, and return full control over state and local governments to their citizens. Most significantly, if it adopts this one reform, Congress will rid itself of a major distraction from its national responsibilities.
The one substantive argument against my proposal is that it would eliminate a ready means for redistributing money from wealthier states to the poorer ones, not that existing programs can be counted upon to spread that money equitably. As the Advisory Commission on Intergovernmental Relations has observed in An Agenda for American Federalism, “the record indicates that federal aid programs have never consistently transferred income to the poorest jurisdictions.” Nevertheless, the argument in favor of the grants programs as instruments of redistribution must be met. The average per capita income of the 10 poorest states is 67.6 percent of that of the 10 richest. On the face of it, that is a strong argument for asking the latter to help the former meet the cost of providing their residents with acceptable levels of services. The average cost of living in the 10 poorest states, however, is 78.6 percent of that of the 10 richest ones, which significantly narrows the gap between them, especially when one considers the anomalies that exist in individual cases. To cite an extreme example, Mississippi’s per capita income is 75 percent of Hawaii’s, but its cost of living is only 55 percent of the latter’s. I doubt, though, that anyone will suggest that Mississippians, who inhabit our poorest state, should send care packages to Hawaii, which is our 17th richest.
Redistribution, then, is a weak argument in favor of existing programs, especially when one takes into account the regulatory freight they carry with them. But if redistribution is indeed a proper function of the federal government, there is a far better way to achieve that goal without imposing webs of federal regulations on all the states, rich, and poor alike. My brother William F. Buckley, Jr. proposed a simple means of redistribution in his 1973 book, Four Reforms. In his discussion of federal welfare programs, he noted the inherent idiocy of returning money to the wealthier states with instructions on how they can best meet their own welfare needs. He therefore proposed that all federal social welfare grants programs be scrapped and, in their stead, that the federal government provide the have-not states with block grants having the sole requirement that the recipients use the money for welfare. Under that approach, Washington would not be telling the states how to meet their own responsibilities. Nor could it use the needs of the poorer states to impose federal regulations on the wealthier ones.
Washington’s experts have proven no betterable to help the homeless, or educate a child, or resolve any other state or local problem than the officials who have been elected to take charge of those responsibilities.
Can It Be Done?
Americans reviewing the impact of our grants-in-aid programs over the past 50 years can be expected to reach the following common sense conclusions:
● Washington’s experts have proven no betterable to help the homeless, or educate a child, or resolve any other state or local problem than the officials who have been elected to take charge of those responsibilities.
● The programs waste tens of billions of dollars a year that the states can put to more effective uses—or leave in their taxpayers’ pockets.
● In a country such as ours, one size can’t fit all.
● The money states receive from Washington isn’t free. It comes from the federal taxes we pay or from borrowed funds that our children will have to repay.
● Easy money is the enemy of prudent spending.
● Ordinary citizens can’t influence federal bureacracies, but they can still get a hearing at city hall.
● Members of Congress should stop wasting their time on matters that can be handled better at the state and local levels; they should focus on matters that are their exclusive responsibility.
Those points are easily grasped, and an aroused electorate is capable of political miracles. Given the growing distrust with the status quo in Washington, the distrust of federal panaceas that has been triggered by ObamaCare’s cascading costs, and the simplicity of my proposed reform, I believe it can prove the focal point for a nationwide grassroots demand for meaningful reform.
Mr. Buckley represented New York in the United States Senate as a member of the Conservative Party from 1971 to 1977. He also served as a judge of the United States Court of Appeals for the District of Columbia Circuit from 1985 to 2000. This article is excerpted from his book Saving Congress from Itself: Emancipating the States and Empowering Their People (Encounter Books, 2014).
IN THE AFTERMATH of the Great Recession, few impediments to opportunity loom larger for young people than student loan debt. Most students graduate from college with tens of thousands of dollars in debt to their names—an especially heavy burden given the difficulties they continue to face in the post-2008 labor market. Yet for all the money Americans spend on higher education, the value of a college degree is hardly a clear proposition. Given the waste, both in terms of administrative costs and frivolous coursework, at many four-year institutions, students are increasingly turning to new options like online courses to trim the fat, learning precisely what they want without wasting money to subsidize university largesse. But these options remain unconventional for a reason: Because their legitimacy is not recognized by the accreditation system bearing the federal imprimatur, they are at a major disadvantage in the higher education market.
The accreditation system persists not because it is efficient. It remains because it serves the special interests of the higher education industry. Old models remain entrenched through the arbitrary legal advantage they receive under the existing accreditation regime, and students seeking jobs that require traditional degrees have no choice but to shoulder the cost.
Given the clear need for reform, why has Congress failed to act? The answer, in part, is that the debate over higher education has become stagnant, dominated by discussions of small-bore reforms that would only contribute to the problems in the market rather than solving them. This is a debate conservatives would do well to disrupt.
The Stagnant Interest Rate Debate
For the past several decades, the higher education cost conversation has been defined by the debate over whether to increase federal student loans and grants.
Despite the fact that an open spigot of federal student aid has only exacerbated the college cost problem, Congress has consistently increased loan subsidies, expanded access to need-based grants such as Pell, and provided for generous caps on debt repayment, which can lead to a portion of a student’s loans being forgiven entirely by taxpayers. By keeping interest rates artificially low or expanding eligibility for Pell Grants beyond those students most in need, policymakers contribute to increases in college costs over time.
Big government policies like a “millionaire’s tax” to finance student loan forgiveness will do nothing to solve the college cost crisis in the long term. Similarly, other short-term fixes, such as capping monthly loan payments, will only serve as band-aids for college costs while giving license to universities to continue to spend profligately, confident that the federal government—via the three-quarters of taxpayers who don’t hold bachelor’s degrees themselves—will continue to pick up the tab.
The Failures of the Status Quo Approach
Research suggests that “institutions may indeed raise tuition to capture the maximum grant aid available.” Even President Obama admitted that subsidies are the source of the problem.
There is growing recognition among education analysts that the traditional approach is not, in fact, making college more affordable for students. Researchers at Cornell University found that increases in federal student aid such as loans and grants contributed to increases in tuition for in-state students. Research conducted by Stephanie Riegg Cellini and Claudia Goldin on for-profit colleges suggests that “institutions may indeed raise tuition to capture the maximum grant aid available.”
Even President Obama admitted that subsidies are the source of the problem when he said, in his 2012 State of the Union speech: “We can’t just keep subsidizing skyrocketing tuition.”
These policies have contributed to a vicious lending and spending cycle: Congress increases the number of students eligible for federal Pell Grants, eases repayment requirements for student loans, and makes interest rates more generous for borrowers. This easy flow of federal student aid—which is available to students regardless, for the most part, of their credit-worthiness, major, or ability to repay the loans—enables universities to continue to raise tuition, sending students back to the federal trough for more financial aid.
“Subsidies raise prices, leading to higher subsidies, which raise prices even more. Yet this higher education bubble, like the housing bubble, will eventually pop,” warns economist Veronique de Rugy of the Mercatus Center at George Mason University. “Meanwhile, large numbers of students will graduate with more debt than they would have in an unsubsidized market.”
Since 1980, tuition and fees at public and private universities have grown at least twice as fast as the rate of inflation. The result has been that 60 percent of bachelor’s degree holders leave school with more than $26,000 in student loan debt, with cumulative student loan debt now exceeding $1 trillion. As average student loan debt continues to increase, the value of a college degree declines. Many students find themselves leaving college with bachelor’s degrees that have not prepared them for challenging careers. Employers increasingly report that college graduates are unprepared to enter the workforce. And that is the reality just for the 60 percent of students who actually do graduate within six years of entering college. Those who take on tens of thousands of dollars of student loan debt without earning a degree find their ability to climb the economic ladder toward middle class stability or better is limited from the very start.
In short, the existing higher education system inhibits upward mobility by saddling students with debt without guaranteeing they have obtained the skills and competencies to achieve career success. Although a college degree has gained importance in recent decades, the payoff, after factoring in student loan debt and other opportunity costs, is sometimes below face value. Almost half of college graduates are in jobs that do not require college skills, and more than half of graduates cannot find full-time work related to their area of study.
Misguided Reform Ideas
Current policy simply is not working. It’s time for reform. But enhanced subsidies aren’t the only bad reform concept currently on the table.
Capping Loan Repayments. Some policymakers have suggested fixing loan repayments to a proportion of a graduate’s income—even automatically enrolling graduates in such a plan—or otherwise capping loan repayments even more generously than already allowed for. In order to keep college costs in check, policymakers should be doing precisely the opposite.
Such efforts would enable colleges to continue raising tuition, knowing that borrowers’ repayments would be capped. And there are several such options already in place.
Repayment caps put no downward pressure on college prices and spread the cost of attending college to taxpayers, the vast majority of whom do not hold bachelor’s degrees themselves. Payment caps are problematic also because they make students less sensitive to increases in college costs and likely encourages students to attend college who may be better off entering the workforce sooner or pursuing vocational education.
Instead of trying to figure out ways to manipulate debt repayments, policymakers should look at ideas that turn the tide of increasing college costs.
Accreditors have the authority to place an official stamp of approval on colleges recognized by the federal government—a process that favors entrenched institutions and old education models over upstart insurgents seeking to break into the market.
Federal Scorecards. Others, such as President Obama, have suggested a federal rating system or “scorecard” tied to federal financial aid. Such a scorecard would act as a college rating system to evaluate colleges on measures such as graduation rates, the number of low-income students served (i.e., the percentage of Pell Grant recipients), graduate earnings, and affordability, which would then be tied to access to federal student aid. But a government-run rating system would inevitably reflect what bureaucrats—rather than parents, students, and scholarly communities—determine is important in education.
A competing range of private outcome-based scorecards already exists, sponsored by such outlets as U.S. News & World Report, Forbes, the American Council of Trustees and Alumni, and Kiplinger’s. Each of these reflects the differing visions of quality held by different Americans, from post-graduation salary to the likelihood of a well-rounded education. These independent evaluators that parents and students have long trusted make a one-size-fits-all federal rating system unnecessary.
Transforming Higher Education
Real higher education reform would aim not to tackle the symptom—high costs—but the root of the problem: the sclerotic nature of the existing higher education sector, which is insulated from market pressures in large part by the federal accreditation system.
Currently, the Department of Education authorizes a group of organizations as federal accreditors. The process is highly selective, requiring several years of previous accreditation experience before recognition, notice in the Federal Register and public comment, and review by the National Advisory Committee on Institutional Quality and Integrity—a cartel of higher education industry insiders that submits a recommendation on approval or denial to the Department of Education before any decision is made. Once selected, these accreditors have the authority to place an official stamp of approval of colleges recognized by the federal government—a process that favors entrenched institutions and old education models over upstart insurgents seeking to break into the market.
That seal of approval is more than symbolic. It is a gateway to federal financing, as student loans and grants may flow only to those institutions that have received federal accreditation. Given the degree to which higher education financing is dominated by the federal government, an accreditation denial places an institution at a massive disadvantage in the marketplace.
This accredition system inhibits innovation in three ways.
First, it is a poor measure of quality, focusing more on inputs like the number of library books owned by institutions than on outcomes like performance and graduates’ skill attainment. In the words of a report from the American Council of Trustees and Alumni, “If the accrediting process were applied to automobile inspection, cars would ‘pass’ as long as they had tires, doors, and an engine—without anyone ever turning the key to see if the car actually operated.” After all, the existing system places taxpayers on the hook for such courses such as “Cyberfeminism,” and “Lady Gaga and the Sociology of Fame.” Because the existing accreditation system rates entire institutions, any course taught at an accredited university is an accredited course, usually credit-bearing—no matter how frivolous.
Second, it allows market players with heavy conflicts of interest to control their own competition through the bottlenecks of both accreditor licensure and accreditation of educational institutions. Aside from the obvious problem posed by allowing self-interested participants to deny entry to the market by their most threatening challengers, the current accreditation system also disincentivizes the removal of institutional accreditation attained by schools that have since lagged in performance, as withdrawal of accreditation would reduce the dues paid to the accreditation association.
Third, it entrenches outdated models of instruction, slowing down the emergence of new ideas such as online learning and course-level or skills-based certification and tilting the scales in favor of expensive tuition-based, multi-year, full-degree campus programs. Though the existing accreditation system allows some degree of more granular programmatic accreditation in addition to full institutional accreditation, program-level accreditation generally is only granted to institutions that have already received full organizational recognition by the national accreditors, not to standalone programs that operate outside fully accredited institutions.
The current Congress will likely debate the reauthorization of the Higher Education Act (HEA). Now up for its 10th reauthorization, the HEA touches nearly every aspect of federal higher education policy. Yet some of the law’s titles and programs have outlived their purpose; others make it difficult to reform higher education financing in a way that would increase access for students and drive down college costs. Trade groups, professional organizations, accreditors, and universities have already begun to voice their concerns and recommendations for the 11 titles composing the law. Lawmakers considering the reauthorization should not put these special interests’ priorities ahead of those of students and taxpayers.
A real higher education market would promote not just those programs offered by traditional colleges and universities, but also those credentialed by businesses and other non-college institutions.
One objective for this reauthorization should be to streamline the HEA in a way that more closely adheres to its primary purpose of allocating federal student loans and grants to ease the cost of college—part of President Johnson’s goal of keeping “the doors to higher education open for all academically qualified students regardless of their financial circumstances.” That goal requires eliminating duplicative, unnecessary, or ineffective programs and titles that have accrued over the decades and considering reforms that would ensure the HEA best serves students. The following ideas offer the most promise:
Reform Accreditation. A real higher education market would promote not just those programs offered by traditional colleges and universities, but also those credentialed by businesses and other non-college institutions. Enabling aid to follow students to those individually credentialed courses could reap massive savings and transform the industry. In order to harness the promise presented by budding higher education innovations—low-cost online courses and Massive Open Online Courses (MOOCS) that hold the potential to drive down college costs significantly—the existing de facto federal system of accreditation must be reformed. Sen. Mike Lee (R-Utah) and Rep. Ron DeSantis (R-Fla.) have introduced the Higher Education Reform and Opportunity (HERO) Act. The bill would get to the root of the college cost problem by reforming accreditation. Rather than eliminating the federal accreditors, HERO would provide competition by granting states the power to establish their own accreditors, who in turn could grant approval to whole colleges and universities, degree programs, and even credential specific courses. These accredited and credentialed offerings would receive the same privileges as current institutions recognized by the federal accreditors, meaning that students would be able to apply federal loans and grants to a far broader array of programs and courses.
In order to harness the promise presented by budding higher education innovations—low-cost online courses that hold the potential to drive down college costs significantly—the existing de facto federal system of accreditation must be reformed.
This simple reform would open up a groundswell of change, allowing students to break free of the expensive, full-degree programs now offered by accredited colleges and universities and instead to chart their own path, selecting specific courses that meet their own and their employers’ needs. Employers would benefit not just from an applicant pool better able to attain the skills needed to succeed but also from the ability to offer their own training courses on a level playing field with existing accredited institutions.
Reform Pell Grants. Reforming the Pell Grant program can help better serve low-income students. Because of expanded eligibility, the Pell Grant program now covers twice as many students as it did a decade ago, instead of allocating its funding to the students who need it most. To better serve the low-income students whom the Pell program was designed to help, an income cap should be set on Pell Grant eligibility, and grants should be made available only to those students who attend college at least half time. The 12-semester limit on Pell awards (put into place in 2012) should be maintained, and the current maximum grant award of $5,830 should not be increased. Finally, Pell funding should be shifted from mandatory funding to discretionary funding, enabling Congress to have more oversight of program funding from year to year.
Eliminate the PLUS Loan Program. The PLUS program is composed of Parent PLUS and Graduate PLUS loans. Parent PLUS loans are available to parents of undergraduate students, letting them borrow up to the cost of attendance at a given college. The loans are available in addition to federal loans that are already available to the students themselves. The availability of Parent PLUS loans, created in 1980, has resulted in families incurring substantial debt while failing to ease the cost of college over time. The Parent PLUS loan should be terminated. Similarly, the Graduate PLUS loan program should be eliminated. Grad PLUS, open to graduate students who elect to take out loans to finance graduate school, enables students to borrow up to the full cost of attendance. Undergraduate and Graduate students already have access to up to $138,500 in federal loans through the Stafford Loan program, and students enrolled in school to become health care professionals can borrow up to $224,000. Borrowing above those already high amounts should not be encouraged through the availability of the Grad PLUS program.
Require the Use of Fair-Value Accounting. Fair-value accounting takes market risk into account and as a result is a more accurate reflection of the cost of federal student loans. Any loan program should use a non-subsidizing interest rate—i.e., the rate at which the program breaks even. Absent fair-value accounting, it is impossible to determine the extent to which the student loan programs are providing a subsidy to borrowers. Specifically, Congress should require the Department of Education to use fair-value accounting estimates calculated by the CBO and adjust loan rates accordingly, on an annual basis.
By focusing on the big picture—the drivers of college debt such as an open spigot of federal student aid and ossified accreditation policies—policymakers can reframe the discussion around higher education. It’s a conversation that’s long overdue—one that demands conservative leadership and could revolutionize how we finance and think about the college experience.
Ms. Burke is the Will Skillman Fellow in Education Policy in the Institute for Family, Community, and Opportunity at The Heritage Foundation. This article is an abridged version of a chapter in the book Opportunity for All: Favoritism to None, © 2015 by The Heritage Foundation.
Give the Answer You Want, Not the One They Want: Use Block and Bridge (B2) to Make the Most of Your Interviews
IT’S NO SECRET that many dread the unknown of reporters’ questions. The reason? Even the friendliest reporters are doing their job when they play devil’s advocate. But the true horror lies in hostile reporters trying to trip up their “guests” with the sole goal of shaming them in a never-to-forget clip.
In response, people have tried some interesting media strategies.
Take Speaker of the House John Boehner, for example. In mid-May, the Speaker found himself on the receiving end of what he considered to be a less-than-ideal question. When asked whether Amtrak was well-funded enough in the lead-up to the crash of Amtrak 188, his response began with: “Are you really going to ask such a stupid question?”
The result? The media, even the usually friendly Daily Caller, covered the derisive response more than the content of his answer.
Another “strategy,” not quite as extreme, was instituted by Carolina Panthers’ quarterback Cam Newton this past fall. After being sidelined in Game 1 of the NFL season, he decided not to answer any questions on the matter and focused only on the next week’s game. He said repeatedly (six times) that: “My main focus right now is focusing on the Detroit Lions.”
The result? A 24-hour news cycle on ESPN detailing why he didn’t answer the questions posed.
The lesson to learn is when you avoid and/or insult the media and their questions that becomes the story. And that isn’t the narrative you want to tell.
The good news is that there is a strategy that works. It’s called the “Block and Bridge” (or what I refer to as B2), and it is the true art of interviewing well.
Block and Bridge (B2)
To break it down, blocking and bridging is the process of briefly acknowledging a question but quickly pivoting to the talking point you want to give. It’s the tool necessary to avoid the accusation of dodging.
This does mean that prior to an interview you must determine what talking points are best. If you view your three to five minutes as a typical Q&A or as a battle of wits with the reporter, you’ll spend your time trying to convince the host rather than the audience. And if the quality of the interview is based on the quality of the questions you’ll be on the short end of the stick the majority of the time.
So how does it work? Whenever you are asked a question you want to block—whether it’s hostile, off-topic, or just not that great—you first start by briefly acknowledging the question. Then you bridge to the talking point you want to discuss. You should be able to do this in 10 seconds.
Here’s an example on the topic of school choice:
Q: “If you are taking money away from traditional public schools, won’t that hurt them further?”
B2: “What we find is that all schools improve, including traditional public schools, when funding follows the child instead of a school building. Just look at .”
Instead of devoting your entire answer to talk of traditional public schools, you briefly acknowledge the question (in a positive way) and then spend the majority of your time giving the answer you want to give.
This does mean you should prepare for questions in advance to develop your block and bridge.
You may be thinking: “How do I know what they’ll ask?” Good news: The toughest questions (usually when the host plays devil’s advocate) are recycled. For each topic, there are generally three to five tough questions. And, if you are ever caught off guard, just add that new question to the list and develop a block and bridge response!
Avoid These Mistakes
Even if you have prepared, keep in mind the following pitfalls and how to avoid each.
Say What You Are Instead of What You Are Not. Be careful of negative accusations. It is always best to say what you are instead of what you are not.
History shows that not only do people tend to think you are guilty of what you’re saying you’re not, but it also becomes the headline. Here are some memorable “I’m nots”:
● “I’m not a liar.”
● “I’m not a crook.”
● “I did not have sexual relations with that woman.”
● “I’m not a witch.”
We can learn from Chris Christie on this one. In January 2014, the New Jersey Governor held a two-hour press conference explaining his involvement—or lack thereof—in the “Bridgegate” scandal. While the governor’s focus was to emphasize that he knew nothing about the scandal, questions turned towards the governor’s temperament—as they often do. Reporter’s asked him: “Are you a bully?”
By most accounts, Christie handled the press conference well, but his response to this one question became the focus of the USA Today Weekend front-page story. The headline read: “I am not a bully.”
In addition to the public assuming you are guilty of what you’re saying you aren’t, the quote is memorable and will determine your public fate. The quote becomes the story.
You can’t avoid recognizing accusations, but you can control your response. The best way to handle a negative accusation? Craft it into something true and positive about you, your organization, or your position. While you can’t change the question, you have the power to change the narrative.
If Governor Christie had rephrased the negative question and responded with, “I treat all my staff with respect,” the front-page story may have focused on the actual scandal, which was “Bridgegate.”
Meet Emotion with Emotion Before You Get to Policy. Often, the toughest questions involve a victim and therefore a lot of emotion. The mistake many people make is to ignore the victim and go straight to a talking point on policy. Sure, that policy will most likely help the victim in question. But tell the audience. Even though you know how a specific talking point on policy helps people, you have to connect the dots for the audience. If you don’t acknowledge their victim, it sounds like you don’t care.
Here’s an example concerning guns:
Q: “But what about all those kids who were killed in Sandy Hook? Guns kill people.”
B2: “What happened at Sandy Hook was a horrible tragedy, but the sad reality is that even if this piece of legislation had been in place it wouldn’t have prevented what happened. That’s why we need to focus on .”
While you will talk about the piece of legislation, you met the emotion of the question first. People may disagree with you, but at least you sound like you care.
Another tricky topic is religious liberty. We saw the storm most heavily in Indiana this past March when a Religious Freedom Restoration Act (RFRA) was passed. Here was a typical question in the news, and a suggestion on how to meet emotion with emotion:
Q: “Yes or no, if a florist in Indiana refuses to serve a gay couple at their wedding, is that legal now in Indiana?”
B2: “This law doesn’t address that. What this does is allow any person who claims discrimination to have their day in court. It eliminates your opinion and my opinion from the equation, and puts the decision in the hands of our judicial system so that everyone’s rights are protected.”
If asked about religious liberty just B2 it!
While we can’t dictate the questions asked, we can change the direction of those questions—and, therefore, the narrative. Remember: No one can put words in your mouth. If you focus on saying what you are and how your position helps people, you’ll avoid the John Boehner and Cam Newton method of dealing with the press because insulting the media and/or ignoring their questions is never a winning strategy. Instead, incorporate the winning strategy of block and bridge.
In summary, just B2 it!
Ms. Hallberg is President of District Media Group, a company that teaches interview skills to public policy professionals.
IN LATE MARCH, a federal investigator announced that Hillary Clinton’s brother Anthony Rodham and Virginia Gov. Terry McAuliffe (D) had used their political influence to press the U.S. Citizenship and Immigration Services to speed visa approvals for foreign citizens investing in their startup electric car company—approvals that came despite the objections of agency staff.
The IG’s report confirmed findings of a two-year investigation by Watchdog.org, a project of the Washington D.C.-based Franklin Center. In a series of articles about McAuliffe’s company, Watchdog reporters documented the Obama administration’s politicization of a controversial federal program that fast-tracks visas for foreign investors in U.S. companies. The Watchdog investigation was punctuated in April 2013 by an $85-million lawsuit in which McAuliffe and Rodham’s GreenTech Automotive alleged that Watchdog’s reporting defamed the company.
Despite the lawsuit, Watchdog reporters kept digging, producing their findings in more than 70 articles. And when the Inspector General released his audit in March, the facts of the case, first uncovered by Watchdog reporters, were clear to all: McAuliffe, while campaigning for governor, had bragged that he had created an American car company. Bill Clinton had helped broker the deal with Chinese backers that put McAuliffe in a position to make that claim. Anthony Rodham had served as president of GreenTech’s financial arm, Gulf Coast Funds Management, which solicited investments from foreign investors in exchange for visas under a controversial federal program. Several former Clinton and Obama officials were among the company’s highest-profile executives. Virginia state economic development officials and staff at the U.S. Citizenship and Immigration Services considered the car company’s business model unworkable—“a cash-for-visas scheme,” one of them called it. McAuliffe and Rodham used their connections to press high-ranking Department of Homeland Security and White House officials—including then-Homeland Security Secretary Janet Napolitano and White House green-energy aide Greg Nelson, the man behind the Solyndra debacle—to speed visa approvals for GreenTech investors.
The story that was under the radar when McAuliffe began his successful run for Virginia governor was ultimately picked up by network news affiliates in Virginia and Mississippi, and by such national outlets as the Drudge Report, The New York Times, Washington Post, Washington Examiner, Washington Times, PBS NewsHour, TownHall.com, Human Events, National Review, Reason, FOX News, and Glenn Beck’s TheBlaze.
The series has been cited in three federal investigations into the company—by the Securities and Exchange Commission, by the Department of Homeland Security’s Inspector General, and by the Senate Judiciary Committee.
“The McAuliffe story is one example of how our reporting system works—by looking for local stories that have national resonance,” says Erik Telford, a longtime senior executive of the Franklin Center and now president of the six-year-old organization. “We started with a Virginia state reporter just checking out candidate McAuliffe’s resume, and then digging into his claim that he’d created a new American car company. That led the reporter to the federal visa program and to Mississippi, where McAuliffe ultimately cut the deal to open a state-supported operation.”
In the beginning, the Franklin Center was a grant-making organization, funding and training reporters who worked closely with state-based free-market think tanks. There have been notable successes: The Illinois Policy Institute’s state news bureau is headed by the entrepreneurial Scott Reeder, founding editor of Watchdog. The Idaho Freedom Foundation’s news content is a product of former Montana Watchdog reporter Dustin’s Hurst’s muckraking style. Independent of the Franklin Center, former journalist John Hood has established not just a destination website but also Carolina Journal, a powerful, sharp-elbowed monthly newspaper operating out of the John Locke Foundation.
The Franklin Center now has evolved from making grants and training reporters to doing journalism itself—with more than 30 Watchdog reporters on staff who cover every state in the nation. In its profile of Watchdog, “‘Serious, point-of-view journalism’?” Columbia Journalism Review called the Franklin Center’s national reporting network “the most ambitious conservative news organization you’ve never heard of.” Governing Magazine observed: “What is clear is that, when Watchdog sinks its teeth into a story, it doesn’t let go.” Intending to terrify its liberal audience, the activist group Media Matters said Watchdog’s Wisconsin bureau “has reached a level of influence hard to match.” Later in the same piece, political reporter Dan Bice of the Milwaukee Journal Sentinel said of Watchdog: “What they have done is influence the outcome of elections.”
But Watchdog’s real goal: to root out government waste, fraud and overreach, and to illuminate successful limited government policies that are often ignored by the mainstream press.
“In most of those cases, our reporters still work closely with state policy groups,” says Telford. “And in all those states we hope to build full news bureaus—not just one reporter contributing to a national news site, but bureaus with several reporters, and video and podcasting capacities.”
As an example of this full-fledged bureau, Telford points to Watchdog’s foray into Texas. There, reporter Jon Cassidy caught the attention of local donors thrilled by Cassidy’s 18-month investigation of influence peddling at the University of Texas at Austin Law School.
When Cassidy began his investigation, Wallace Hall, an appointee of Gov. Rick Perry (R) to the University of Texas Board of Regents, was about to be impeached for alleged ethics violations, charges driven by University of Texas at Austin President Bill Powers. Eighteen months later, Powers is resigning in disgrace and Wallace Hall is a Texas hero.
Until Cassidy’s arrival, the media, the university, and the legislature were railroading Hall. His crime, they said: blowing the whistle on influence peddling at the university’s law school. Lawmakers accused Hall of making frivolous document requests, of making wild accusations, and even of trying to destroy the university. Cassidy cut through the accusations and proved that Hall was right: A bipartisan group of legislators had for years used the University of Texas admissions process as their own spoils system. Wallace Hall threatened that privilege.
Cassidy showed Hall’s allegations were on target by developing sources in the legislature and the university. He began with a simple working strategy—simple but difficult: If he could identify students who were unqualified for admission into the prestigious school but who were admitted anyway and who then failed the Texas bar, then he might find a common denominator—a link between the student and a powerful patron inside government.
Cassidy built a database that tracked over a decade’s worth of academic data of students admitted to the University of Texas at Austin Law School and then traced those who later performed poorly on the Texas Bar exam. Then he found the smoking gun: documents that linked an extraordinary number of the under-qualified students to a powerful lawmaker or state official.
An independent audit subsequently confirmed Cassidy’s findings. Without admitting any wrongdoing, Powers, the well-named president of the University of Texas at Austin, resigned.
Now, Cassidy is a foundational player in a more ambitious Texas Watchdog bureau. Austin-based Watchdog editor Mark Lisheron will manage a staff of reporters, including Cassidy, in Houston, West Texas, and Dallas-Fort Worth. Lisheron, who has been an investigative reporter at the Milwaukee Journal Sentinel and the Austin American-Statesman, says Watchdog’s first “model bureau” will have the reportorial firepower “to bring honest journalism to a state increasingly in the thrall of government power.”
“We’ve made quite a mark with just one reporter,” Lisheron says. “But Texas is a big state with issues that deserve big coverage. When fully staffed we intend to run rings around the Texas Tribune and the big, but increasingly lazy and out of touch daily newspapers.”
Watchdog reporters are uncovering malfeasance all over the country. In Wisconsin, Matt Kittle has revealed an anti-Scott Walker Democrat is using the power of his District Attorney’s office to harass conservative activists. In Colorado, Art Kane’s series on welfare withdrawals at ATMs in casinos, liquor stores, and pot shops led to a new law to stop the misuse of taxpayer funds. In New Jersey, reporter Mark Lagerkvist has illuminated Gov. Chris Christie’s (R) failure to rein in out-of-control public-employee pensions. In Vermont, Bruce Parker helped publish videos of ObamaCare architect Jonathan Gruber mocking voters. In these states and around the nation, Watchdog is on the ground and watching.
Mr. Swaim is Vice President of Journalism at the Franklin Center for Government and Public Integrity.