For anyone who recently has bought a car, it is striking how data-driven and consumer-friendly the process is. Gone are the days where consumers operated in the dark and car salesmen held all the power because of information asymmetry.
Now consumers can look up a car’s entire history — from its first inspection at the manufacturer, to whether it’s been in an accident, to even the last time its previous owner rotated its tires — guaranteeing a clear picture of a car’s condition and whether it’s worth buying. Consumers can even look up every recent sale of the exact make and model of car they’re interested in buying to ensure they’re getting a fair price. And they can do so all from the comfort of their own homes, an extra perk in the age of COVID-19.
Yet for Americans looking to make one of the other most costly decisions of their lives — choosing to attend college — the modern benefits of being able to use accurate data in real time to inform decision-making lag far behind, in large part because of self-imposed limitations.
Take something as straightforward as the graduation rate. A school’s official graduation rate includes only first-time, full-time students who graduate within 150 percent of the normal time (that’s six years for a bachelor’s degree and three for an associate degree). Part-time students, who account for 38 percent of all students, are not included. Nor are transfers, returning students, or those who take longer to graduate.
And, in a post-COVID world where nearly every college is confronting hybrid or fully-online modes of teaching, we don’t currently have a way to measure which students are taking courses online — let alone whether their institutions are serving them well.
Why is higher education stuck in the data Dark Ages? The primary culprit is 2008 legislation that banned the creation of a federal student-level data system. This law has blocked consumers from getting the actionable information they need to make informed decisions about which colleges will serve them best. It also has had the unintended consequence of suppressing our ability to improve policy by restricting the very data needed to inform meaningful change.
In many cases, the data exist at institutions and across different federal agencies, yet the law prevents these entities from easily sharing this information to help consumers make better decisions. The Federal Student Aid office within the Department of Education, for example, manages student loans and repayments. If not for the 2008 law, this data easily could be matched with graduation data from colleges to determine if there are programs, or even entire colleges, where graduates are consistently unable to repay their student loans.
Unleashing the data would allow for better-informed decision-making by students and parents selecting a college, while improving policymaking in the process, too. With the current data being aggregated at the college level, rather than at the student level, policymakers are forced to use a “carrot-and-stick” approach with entire institutions, which is like using a sledgehammer when a scalpel would be more appropriate.
Luckily, this is a solvable problem. Congress can act this year to pass the College Transparency Act (CTA), a strongly bipartisan, bicameral bill that would create a privacy-protected, student-level data network and bring higher education into the data-driven 21st century. Passing the CTA would allow students and parents to find college acceptance rates for similar students at various colleges, their probability of completion, and outcomes for graduates from their chosen college and major. With more students likely to head back to college as they look to dig out of the post-pandemic recession, students and taxpayers need the full picture of which programs and schools will give them a return on their investment.
It’s rare in today’s highly polarized world — and in the midst of a contentious presidential election — that a conservative think tank and Democratic think tank would join forces to call for a shared federal policy priority. But both sides can agree that it’s long overdue for higher education to join the information age.
There’s nothing partisan about making sure students and taxpayers can fully understand which colleges are poised to provide them with long-term economic gains that postsecondary education claims to afford.
Tamara Hiler is the director of education at Third Way.
Andrew Gillen is a senior policy analyst in the Texas Public Policy Foundation’s Center for Innovation in Education.