July 7, 2025 • 50 mins
The higher education landscape is undergoing a profound transformation, with a new focus on measuring value and ensuring economic mobility for students. In this revealing conversation with Kelly McManus, Vice President of Higher Education at Arnold Ventures, we explore the reconciliation bill currently moving through Congress and its far-reaching implications for colleges, universities, and most importantly, students.
At the heart of this policy shift lies a deceptively simple question: Are students better off for having attended a particular program? Both Democratic and Republican policymakers increasingly agree that programs receiving federal dollars should demonstrate their value through graduates' economic outcomes. The reconciliation bill represents this emerging bipartisan consensus, with provisions that would end Title IV funding eligibility for programs that leave more than half their students worse off than typical high school graduates.
Graduate education faces particularly significant changes, with the bill proposing to end the unlimited Grad PLUS loan program and institute caps of $100,000 for master's degrees and $200,000 for professional programs. This addresses growing concerns about the proliferation of expensive graduate degrees that fail to deliver proportionate economic returns.
McManus offers a compelling framework for low-income and first-generation student advocates: these vulnerable populations need protection from predatory programs that promise economic mobility but fail to deliver. True equity requires ensuring that all programs provide genuine value, not just access to debt.
Looking ahead, implementation will be crucial. Arnold Ventures is already working with states to develop credentials of value frameworks and scale evidence-based models like CUNY ASAP. As budgets tighten, institutions that truly center students rather than revenue will be those that thrive in this new accountability era.
Whether you're a policy professional, higher education leader, or concerned student, this episode provides essential context for understanding how the measurement of college value is fundamentally changing. Subscribe to the Rant Podcast for more insightful conversations on higher education's most pressing challenges.
https://www.arnoldventures.org/people?team=higher-education
eloy@4leggedmedia.com
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:10):
Hi, this is Eloy Ortiz-Oakley and welcome back to
the Rant Podcast, the podcastwhere we pull back the curtain
and break down the people, thepolicies and the politics of our
higher education system.
And we're talking politicstoday.
We're talking about PresidentTrump's reconciliation bill
that's before Congress as wespeak.
(00:30):
At the time of this recording,the Senate had just passed its
version of the reconciliationbudget proposal and sending it
back to the House.
We're going to focus on theportion of the budget that is
specific to higher education.
So, specifically, the proposalthat came out of the HELP
Committee and with me to talkabout it is Kelly McManus, vice
(00:55):
President of Higher Educationfrom Arnold Ventures.
Arnold Ventures is aphilanthropy in Washington DC
focused on a number of policyissues, including higher
education.
They've done quite a bit ofwork on higher education policy
and are considered to be one ofthe more influential
philanthropies on highereducation in Washington DC today
(01:17):
.
So Kelly will sit down with meand we'll talk about the
reconciliation budget, thedifferences between the House
version and the Senate versionand what we expect will be in
that final package as it makesits way to the President's desk.
Before we get into that, I justwant to give my quick take.
While there are a lot of piecesof this reconciliation budget
(01:39):
that are hard to swallow,particularly when it comes to
Medicaid and other programs forlow-income Americans, plus
numerous tax cuts that favor themore wealthy in this country,
the reconciliation budget thatis focused on higher education,
I believe, actually has somevery positive elements to it,
(02:02):
particularly aroundaccountability.
Very positive elements to it,particularly around
accountability.
Accountability as it relates tothinking about earnings to debt
ratios for graduate programs,ending the grad plus loan
program and putting a greaterfocus on value, measuring value
in higher education and ensuringthat students are not left
(02:23):
worse off than they would havebeen by enrolling in a program
of study.
There's been a lot of movementover the last few years to focus
on measuring value, beginningin the Biden administration and
now moving forward into theTrump administration.
So we're going to focus on thatelement and I believe this will
set the stage for measuring anew way, beyond completion,
(02:47):
beyond access, and moving towardvalue.
Moving toward ensuring thatindividuals who enter a program
of study and who are sold a billof goods for that program of
study and that's typically a jobat the other end of it, good
earnings on the other end of it,improving your life and the
life of your family on the otherend of that program.
(03:09):
Now we're going to have a systemthat begins to focus in on how
to measure that, and while thereare still some flaws in this
bill and many of my colleaguesthroughout higher ed policy will
point those out it does set thestage for a new way of
measuring value in highereducation.
And the work then begins afterthis bill is signed into law,
(03:31):
which I expect it will be by thetime this podcast airs.
The work begins on theimplementation, to ensure that
the implementation is done rightand that we follow through with
other pieces of cleanuplegislation that continue to
focus on improving the highereducation ecosystem.
And, of course, at the top ofthat list will be the
(03:54):
reauthorization of the HigherEducation Act.
So we'll have much more to sayabout that in future episodes,
but for now, please enjoy myconversation with Kelly McManus,
vice President, higherEducation at Arnold Ventures.
Kelly, welcome to the Rantpodcast.
Speaker 2 (04:12):
Thank you for having me.
I'm so excited to be here.
Speaker 1 (04:18):
Well, it's great to have you.
It's about time we had you onthe podcast.
Thank you for all the work thatyou're doing there in DC, and
let's talk about that work.
So, for our listeners who arenot very familiar with Arnold
Ventures and they must be livingunder a rock, assuming that our
listeners are familiar withyour organization tell us a
(04:45):
little bit about the history ofAV and about your work and what
your vision for the future ofhigher education is going
forward.
Speaker 2 (04:50):
Absolutely Well and, before I jump in, I would be
remiss if I didn't thank you forall of your leadership in the
field.
I was actually talking with oneof my team members this morning
who started her career at CalState Long Beach this morning,
who started her career at CalState Long Beach, and she said
that you are the leader that sheoften looks to when she needs a
(05:10):
good moral compass and whatgood leadership is, and so I am
just very grateful for all thatyou've done and thrilled to have
you leading College Futures nowI think you've got a fantastic
team who I love partnering with,so I appreciate all that you do
.
Speaker 1 (05:26):
Well, thank you.
Speaker 2 (05:28):
So Arnold Ventures is the philanthropy of Laura and
John Arnold, and when theArnolds set out on their
philanthropic journey, theyreally wanted to understand what
programs worked, what programshad evidence of rigorous impact,
and then how could they deploytheir resources to help those
(05:50):
programs.
What they found was that, veryfrankly, most programs don't
have evidence of rigorous impactand we need significantly more
research to understand whatworks.
So Arnold Ventures has grown tobe a philanthropy that
primarily focuses on researchand policy.
We invest in reallyunderstanding the root cause of
(06:13):
some of the most pressingproblems facing our country,
including work in education,which is where the higher
education portfolio lives, butalso in infrastructure, in
public finance, healthcare,criminal justice.
So our higher educationportfolio here at Arnold
Ventures really focuses onmaking sure that students are
(06:37):
better off.
Students who choose to go tohigher ed are better off than
they otherwise would have beenif they hadn't gone to higher ed
at all, and unfortunately, Ithink that's an aspiration that
we could all share, but for toomany students right now that
isn't true.
They aren't completing, or theyare completing and are finding
(06:59):
that the credential that theyhave worked so hard for doesn't
have value in the labor market.
So our focus is on making surethat when a student makes that
investment in their future, thatwe're doing our part as the
higher ed community to make surethat that student has the
opportunity to attain theeconomic mobility that they are
(07:21):
really going for.
And so Arnold Ventures inhigher education invests in
research.
We invest in policy development, invest in advocacy when
necessary and litigation, and inscaling evidence-based programs
to help ensure that morestudents are able to complete
and are also really focused onrecognizing that this is going
(07:45):
to be even more true and I knowwe'll get into this but, as
we're going to see tighterbudgets coming forward making
sure that every dollar that wespend in our public system is
focused on student success andsetting students up for the
economic mobility that wecollectively promised them.
So that's our vision for highereducation Every student is
(08:07):
better off than they otherwisewould have been and all of our
public dollars are flowing in away that can drive that outcome.
Speaker 1 (08:15):
Let me pull on that thread a little bit because, as
I'm sure you well know, that iscertainly a thread that we are
pulling on here at CollegeFutures for California, for all
of our institutions inCalifornia, wanting to get the
greatest value possible to thelearner, to the consumer, who
(08:47):
has every right to demand thatthey get as much as possible for
the dream that they'reinvesting in, the dream that we
sold to them.
Yes, so this whole notion ofmeasuring higher education
differently, thinking abouteconomic mobility, how do you
see the landscape shifting rightnow and do you see that this
movement is picking up momentum?
(09:07):
Do you see institutionsstarting to think differently
about it?
Speaker 2 (09:12):
I am actually very excited about where we are
seeing the conversation go andalso where we're starting to see
policy and practice evolve.
Starting to see policy andpractice evolve.
And so one of the things thathas emerged over the past decade
or so, as you mentioned andthat you have been an integral
(09:33):
part of, is this focus on value.
And I think what is mostexciting for me is when you look
at the policy conversationaround value, it has truly
become bipartisan.
There is an emerging bipartisanconsensus.
There was.
You know, we started two yearsago, 2023.
(09:55):
We had the Biden administrationthat was finalizing the gainful
employment and financial valuetransparency rules.
We're saying you know what?
Like, if you actively leavestudents worse off, you don't
get access to our public dollarsanymore.
Like, we have almost a do noharm principle and but that
(10:16):
could only because of the waythat the HEA is written, that
could only apply to somecolleges and programs.
And what you saw at the sametime, that same summer, 2023,
you had Senators Cornyn andCassidy introduce higher
education package that in manyways, mirrored that same
principle that was focusing ondo no harm, if you actively
(10:39):
leave students worse off, youdon't get access to our public
dollars.
And what you're seeing now isthat in reconciliation which
just for a listener we are rightin the middle of it.
Who knows where things?
Speaker 1 (10:54):
go.
Speaker 2 (10:55):
But that principle is currently reflected in the
Senate reconciliation package,and so I think that there is a
really exciting coming togetherof that.
I think there's still likepolicy is nuanced and there is
going to be a lot of work thatneeds to be done to make sure
(11:16):
that whatever passes getsimplemented in a way that
actually delivers on the promisethat we aren't going to make
you worse off.
I think at the same time, we'reseeing in states in both red
and blue states more stateleaders thinking about
credentials of value, thinkingabout how you can incentivize
(11:37):
those.
In Texas, the community collegesystem has developed a really
exciting new funding formulathat is focused on how do you
lead students to aself-sustaining wage in the
state, and then you see otherblue states that are exploring
that exact same conversation.
Governor Polis in Colorado iscurrently working on a way to
(12:00):
think about economic mobility asa part of their finance formula
, and so one of the things thatI think that unites us all we're
all going to have disagreementson the how is this the right
bar?
What metric works?
Arnold Ventures?
We have invested a lot inresearch to help answer some of
those questions, but at leastwhat we see as most exciting is
(12:24):
that we know the history ofreforms in this country.
The most durable ones are onesthat are bipartisan.
And this is an area where thereis an opportunity to really
grow a bipartisan movement.
Speaker 1 (12:38):
Well, I certainly agree that there is
bipartisanship around this issue, and I hope my colleagues who
are leaders in higher educationunderstand that that this is not
an issue that's going away.
This is an issue that's goingto fundamentally lead into the
way that we think aboutmeasuring higher education, just
as we did with completion.
Absolutely this is in my view,just the next step.
(12:59):
Let's jump into what'shappening right now.
So let's jump into what'shappening right now and, given
that we are recording thisinterview, at the end of June,
the Senate is wrestling with itsversion.
(13:22):
Committee's reconciliation billproposal for higher education
looks like, and some of thethings that you're keeping an
eye on.
Speaker 2 (13:30):
Sure, and one thing again as a disclaimer I will say
this is as of this.
Second, what is in the bill?
There is a chance that evenwithin the time that we are
recording this, it will havechanged, so please don't hold me
to any specifics.
But essentially, what SenatorCassidy has put together for the
(13:55):
HELP package and reconciliationis thinking about how do we
spend our dollars in higher ed,and the biggest chunk of money
that we spend through the HEA isin title work, and so it's
thinking about how do we giveout Pell Grants, how do we give
out loans, how do we get, how dostudents repay?
So what Senator Cassidy has puttogether is a package that we
(14:18):
think advances the conversationabout how we can best structure
our dollars in higher ed.
There are a couple big bucketshere.
First, it changes our studentloan repayment system.
This is the biggest bucket.
This comprises a significantportion of the dollars that this
bill is seeking to save, and itcreates a new repayment plan, a
(14:43):
new income driven repaymentplan for students and then also
a new standard plan for students.
The original bill would havethat apply to all current
borrowers and new borrowers.
As of 24 hours ago, theapplication to current borrowers
got bounced out by the Senateparliamentarian and so there are
(15:07):
some real questions here aboutwhat happens for current
borrowers.
But presumably, moving forward,the borrower will have two
options for repayment.
So that's one big bucket.
That's in the bill.
Second big bucket is changes toloan limits, and this is at the
both undergrad or this is atthe graduate level.
(15:30):
At the house included changesto the undergrad limits.
The Senate is focused on thegraduate level, so the bill
would end the Grad Plus programthat was created in 2006, but
would increase the amount ofeligibility for graduate
(15:51):
Stafford loans to $100,000 formaster's programs and $200,000
for professional programs.
So that's kind of another bigbucket of change.
And the third big bucket ofchange is around title war
eligibility based on outcomesprogram leave your students,
(16:12):
leave more than half of yourstudents worse off than the
typical high school graduates inyour community.
You don't get access to TitleIV dollars anymore.
(16:33):
Students are not going to go indebt for your program anymore
and I think that that's again areally important sea change
policy that we will need tocontinue working on in
implementation.
I think one of the things that Ilike to remind people is the
last time the HEA wasreauthorized in 2008,.
(16:53):
That was on the back of areconciliation bill in 2007.
Give more nuance, give morecleanup.
I think that there is going tobe the need and the opportunity
for us to have bipartisanconversations about how we make
sure these new policies areimplemented effectively.
(17:13):
So those are the biggestbuckets in there.
There's also there are otherpolicies in there.
There was, until 24 hours ago,Workforce Pell an expansion of
Pell to very short-term programsbetween eight and 15 weeks.
That was bounced out.
I know that there are effortsongoing now to try to
(17:37):
restructure that so that it cancome back in.
Restrictions on secretarialauthority, including repeal of
the borrower defense and closedschool discharge rules that are
still under consideration fromthe parliamentarian at this
moment.
So we don't know whether thoseare going to make it in and I
(17:58):
think that those are areas.
You know.
Arnold Ventures has investedfor a long time in making sure
that students who have beendefrauded have recourse and in
our ideal world, those predatoryinstitutions are held
responsible for that.
As an aside, on borrowerdefense, there has been so much
regulatory ping pong here.
(18:18):
It has changed with everyadministration, Every
administration.
I think we'd like to see a moredurable legislative solution to
give defrauded borrowers a pathto being made whole, and so
that's something we're going tobe thinking about in this
potential cleanup bill, shouldreconciliation pass.
So those are kind of the bigpieces that are in right now and
(18:41):
again, there is a decent chancethat, while we have been
talking that has changed.
Speaker 1 (18:48):
I haven't looked at my social feed in the last few
minutes, so I will wait untilafter this conversation.
Let me dig in on a couple ofthings that you brought up.
First of all, there is clearly,in my view, a bipartisan
frustration with graduateprograms Absolutely Graduate
(19:09):
programs.
I've been hearing this.
I was hearing it when I did adrive-by in the Biden
administration.
I've heard this ever since.
I hear it from my Republicancolleagues, I hear it from
Democratic colleagues, and soI'm not surprised that Congress
is trying to do something aboutit.
I do think it's time.
(19:32):
There's a question in my mindand maybe you can answer it, and
this is an in the weedsquestion because of my time on
the UC Board of Regents and thetime I've spent with some of our
four university colleagues.
What I have found is, over thelast 10 years, there's been a
rush to make every graduateprogram a professional program,
(19:52):
for a variety of reasons.
One is most universities chargedifferential fees for
professional programs, sothere's been a proliferation of
professional programs.
Is not just the MD, the JD andthe MBA anymore Right?
How, in the current write-up inthe bill, how does Congress
(20:13):
plan to deal with these twoissues?
Does it specify what aprofessional program is.
Speaker 2 (20:18):
So a professional program is specified in the HEA.
I think this is one of the veryinteresting things that we have
looked at internally as we'vebeen trying to unpack these
policy proposals.
There's a whole category ofprofessional programs that are
in theology and one thing weknow is theology degrees.
(20:41):
You don't go into theology tomake money, you go in for a
different calling.
Speaker 1 (20:47):
Well, we've seen some variations of that.
Speaker 2 (20:50):
Yes, well, that is true, that is true, and so I do
think that this is the type ofpolicy nuance that I think
reconciliation is not the rightvehicle to address and why I
really hope that there is aopportunity for a bipartisan
cleanup.
Hea reauthorization after this,because the House version the
(21:17):
bill had one hundred and fiftythousand dollar cap for
professional programs.
There was a lot of pushbackfrom medical schools in
particular on that, and so theSenate version has a two hundred
thousand dollar cap forprofessional programs.
But what we have found inlooking at the data, first of
all from the Arnold Venturesperspective, we think that,
(21:40):
setting a cap, we are having theright conversation the Senate
and the House.
They have identified the rightissues that demonstrated that
the uncapped nature of Grad Plusled to an increase in 50 cents
(22:04):
on every dollar that was moreavailable.
So cost is going up.
At the same time, access is notincreasing, and that's what we
want.
We want people to be able toaccess graduate programs that
they need, that pay off programsthat they need, that pay off
(22:26):
and grad plus isn't working todo, and so they are addressing
the right issue and we arereally excited that this
conversation is happening,especially, as you know, we're
now at 46 percent of all federalloans are graduate loans.
So we need to be addressingthis issue.
(22:56):
Earnings ratio that would guidelimitations, because there are
some particularly medicalprograms and also some law
programs where that it does costmore than $200,000.
But those people pay off theirloans.
Those are good investments andso we don't want to limit access
to those high paying, highvalue programs.
(23:19):
At the same time, a $100,000limit for some for master's
degrees might be way too highfor some master's degrees.
We've seen the proliferation ofmaster's degrees that don't pay
off and I think that that's whatworries me is that we are still
setting up a system,potentially, where students are
(23:42):
going to think that they'redoing the right thing, they're
going to get the signals I needto go to grad school, I need to
get this master's Universitiesare still going to see that as a
revenue growth opportunity.
I think one of the morehorrifying headlines I've seen
recently around this is whenBrown University, an Ivy League
school, one of the best in thecountry came out and said in the
(24:05):
headline that we so.
I think that there is a veryreal need to address this issue.
I think that, though a debt toearnings.
(24:27):
Where it can go lower, it maybe and we can really focus on
turning the cost curve andmaking sure that programs are
delivering meaningful valuewhile also enabling access to
the high value programs ispotentially a better way to go,
but again, that's not somethingthat you can do.
Have that nuance andreconciliation.
That'll be something that weare working actively on
(24:49):
exploring after we get throughthis little bit.
Speaker 1 (24:54):
Well, after we get through this little bit, there's
still a lot of work to do.
Yes, a lot of work to do, yes.
So let me ask you anotherquestion that you brought up
ending Title IV access forinstitutions that leave students
worse off than they otherwisewould.
I think a lot of people agreewith that notion certainly one
(25:19):
of them but there's also a lotof people who doubt the
execution of that penalty.
Essentially, it's a penalty.
I've had my experiences whereI've had an institution that I
oversaw in California, who wasegregious, who was doing some
horrible things in terms ofquality, but given their
relationship with the leadershipin the House, there was going
(25:43):
to be nothing I could do aboutit.
I mean, there are a lot ofpeople who doubt that we would
actually end Title IV access toan institution.
What do you think the sentimentis in Congress right now about
that?
Speaker 2 (25:56):
I think that our history is not great in this
regard.
I think if you look back at the1992 HEA reauthorization, in
some ways I mean that was reallya high mark for real
accountability.
It certainly had flaws, but hadreal accountability, had an
impact.
(26:16):
There is research showing thatit drove down default rates,
that it had an impact, and thenby the late 90s there is a lot
of political pressure to waterit down, and I certainly think
that there is.
That is a shell of its formerself.
That one of the things that isincumbent upon those of us who
(26:47):
have been thinking about policyand working on these policies
for so long is we cannot walkaway afterwards.
Implementation is going to haveto be as important as all of
the research, the policydevelopment, the advocacy, the
community, everything that hasled us to focus on value.
If we drop the ball and wedon't actually implement
(27:11):
policies, we're still lying topeople.
We're still lying to studentsand saying, oh, don't worry,
we've taken care of the issues,while students are still not
being served well.
So I think it is incumbent onus as funders, as people in the
policy space, to keep an eye onthat.
But one thing I think that theSenate has done.
(27:32):
That is really, reallyimportant and that is important
for higher ed broadly to reallyknow is that they are looking at
programmatic accountability andso it is program by program.
There are very few institutionswhere every single program is so
.
I think the fact that we are,it is much easier to tell an
(27:54):
institution you need to stopenrolling students in that
program.
Then institutions can movethings around, they can develop
new programs, they can identifywhich programs have higher value
.
How do they shift that?
There's still a lot of agencyand there is less political
pressure to shut downinstitutions.
I think that has been one ofthe challenges that the
(28:17):
accountability movement hasfaced over the past decade.
Is this question of like, well,you're going to shut down
institutions?
No, we're saying that you knowan institution needs to look at
their programs, and we're seeingsome of this at the state level
too, where states are askinginstitutions look at your
programs, look at the outcomes,where is their value?
(28:37):
And how are we making sure weare sunsetting the programs that
are consistently leavingstudents worse off while
investing in those that offerreal economic mobility?
Speaker 1 (28:49):
I think that's a great point.
Going after program leveloutcomes, I think, would be a
lot more realistic in thecurrent environment.
Now let's let's talk about someof the differences between the
House and the Senate version.
There are some specificdifferences in Pell eligibility.
Absolutely, and given theappetite, particularly in the
(29:14):
House, to reduce the cost, goingforward as much as possible,
how do you see the Senatereconciling the cost of Pell
with the House?
Speaker 2 (29:26):
I think I wish that we were able to have this
conversation and 24, 48, 72,some number of hours from now,
because I think this is a reallyactive conversation.
I was very happy to see, Ithink, that what we saw in this
so the Senate bill did not makeany of the changes in Pell
(29:48):
eligibility that the House did Ithink that's the result, very
frankly, of some really strongstorytelling and advocacy,
particularly on the part ofcommunity colleges, who would
have been disproportionatelyimpacted, given the number of
part-time students that theyserve.
There is a long-time bipartisansupport for Pell as the
(30:13):
foundation of our investment ineconomic mobility in this
country, but the reality is thatPell is facing a shortfall If
we go into, if we are headedinto, a recession historically,
when we have a recession, morepeople go back to school and
that puts much more pressure onPell and so I think that both
(30:37):
the Senate and the House haveincluded dollars that
immediately plug the Pellshortfall for the short term.
But what we have to have abigger conversation about, and
what the House tried to do, wastry to address that fundamental
long term sustainability of theprogram.
At the same time, you know,both the Senate and the House
(31:01):
proposed workforce Pellexpansions and I think, seeing
that, while seeing the shortfallthat, yes, like both bills are
addressing in the immediate termbut not, you know we're going
to be still having a shortfallconversation in two years, three
years from now, I was flashingback to what we did with
(31:22):
year-round Pell, where we gaveit and then we took it back.
Fortunately, we were able tothen give it back again, but I
think that when there is a Pellshortfall, things get cut,
eligibility gets cut, and so weneed to have a broader
conversation about Pellsustainability over the long
term.
And I think it's also time forus to do more thinking about,
(31:45):
like, what is the purpose ofPell versus what are there?
Are there programs that arebetter served, especially some
of the short term trainingprograms, like could those be
funded through WIOA, recognizingthat WIOA is much, much less
heavily funded than Pell?
Like, I'm not suggestingthere's a one-to-one answer
there, but I do think we need tohave conversations as a higher
(32:08):
ed community about Pell,especially as its value and
buying power has continued toerode.
Speaker 1 (32:16):
Agreed and I think there's a lot of support for a
workforce Pell type program.
But, as you mentioned, thechallenge is always how do you
fund it and do you take it outof Pell?
Do you reduce eligibility onone end, increase eligibility on
the other end?
So it sounds like ArnoldVenture's position is to find a
(32:39):
different source of fundingoutside of Pell.
Speaker 2 (32:43):
I think that would be our preference, though I would
say I think that largely comesback to the evidence.
We know there are someshort-term programs that do
boost economic mobility.
There are a lot that don't.
This week or last week, therewas a report that came out of
AEI and the Burning GlassInstitute that showed that under
(33:04):
20% of short-term certificateshad that significant earning
power boost.
And so, especially if you arepitting students who are going
to whether it's a non-degreecredential but 15 to a year
certificate, an AA, a BA, if youare pinning those against each
(33:24):
other and fighting for the samefunding, like we would prefer
that the dollars follow theprograms that have the greatest
evidence of impact.
In a world in which we live,which is a world of limited
resources, In our perfect world,would everyone have every
opportunity?
I think that this is going tobe especially true as we look at
(33:44):
tighter budgets, unlike 2020,unlike 2008.
Like, I don't see a big influxof new money kind of coming down
the pike, and so institutionsstates they're going to have to
make hard decisions.
Institutions states they'regoing to have to make hard
decisions, and our hope and oneof the things that we are
(34:05):
actively thinking about is howdo you protect value in that
time?
How do you preserve theprograms that have evidence of
economic mobility, evidence ofleaving students better off?
And, when it comes to, how dowe shift funding to those
programs in a world in which wecan't fund everything?
Speaker 1 (34:25):
Yeah, Now there is continued debate about where the
federal role begins and endsand where the state role begins
and ends On this question ofworkforce credentials.
There's an argument out therethat states are in the best
position to figure out whichcredentials create the most
(34:46):
value for their local and stateeconomies.
How do you see the balancebetween the federal and state
role working itself out in thiscontext?
Speaker 2 (34:56):
This is where I get into.
I started my career doing statelevel policy work.
I do believe that states arethe laboratory of democracy.
We at Arnold Ventures have beenbuilding out our engagement
states and are doing some reallyexciting work in North Carolina
and Texas, colorado, tennessee,some other places that where we
(35:18):
see a lot of excitement, a lotof experimentation of how much
we need to learn aboutshort-term credentials, which
ones pay off, what are thefeatures?
Is it you know how muchwork-based learning, what is the
appropriate dosage Like?
(35:41):
There's so much that we need tolearn about what is an
effective credential and it issuch a localized thing that this
is where I think states reallyneed to be kind of in in the
driver's seat.
I think that states are, and soI think that you know.
That is something where both theSenate and the House version of
Workforce Pell inreconciliation included a role
(36:05):
for governors.
I think that in all of ourconversations that we are having
with governors, they arethinking about this and so I
think that that's an appropriaterole.
But where I think that thefederal government can't walk
away is on the data and theresearch is going to be able to
(36:34):
drive effective data collection,data analysis research at the
scale we need than the federalgovernment, and I know we fund
at Arnold Ventures we fund asignificant amount of research
and it is a drop in the bucketcompared to what is needed and
what the federal government canand should be doing.
Our founder and co-chair, johnArnold, has talked extensively
(36:54):
about how philanthropy can'tfill the gap here.
You know, and I think that thatis one of the things I'm sure
that you at College Futuresy'all are trying to wrestle with
too is like what is the role?
And so this is where I think weneed to be clear that the data
collection, analysis, researchon what works and then providing
(37:17):
the support to help states makethose decisions, I think is the
right federal role of some ofthese changes to low-income
learners, first-generationlearners, communities of color.
Speaker 1 (37:37):
There's a lot of concern that the changes or the
elimination of things like GradPlus will impact the ability of
diverse students to accessprograms.
There's concern about some ofthe proposed changes to Pell,
although less so now in theSenate version, but a number of
(37:57):
advocates for low-incomelearners first-generation
learners are concerned about thecurrent reconciliation budget.
What should advocates for thoselearners be focused on and what
kind of advocacy would yourecommend to them at this moment
in time?
Speaker 2 (38:16):
I think that one of the things that I have found to
be kind of most challenging inthe higher education space is
that we do when we areadvocating for low-income
students, when we are advocatingfor low-income students,
(38:47):
students of color,first-generation students.
Too often I'm in conversationswhere there isn't an
acknowledgement that right now,too many of those students are
upon by predatory schools thatare selling a bill of goods that
that are never going to pay off, that too many of them are are
be I don't have the, theadvising, the support that they
need to navigate, like, what arethe programs that are going to
actually deliver value?
To me?
When I think about particularlythe accountability side, that
(39:12):
is like I come at that from alike how do we make sure that,
at a bare minimum, particularlylow-income students,
first-generation students, aregoing to be worse off Like that?
That to me is a fundamental andI think that sharing that,
starting with that value, thatlike, we want to at a minimum
make sure that what students areaccessing, especially when they
(39:36):
are the first in their familiesto do it, that they are
accessing something that hasvalue.
And so I think advocates reallyneed to start with that front
and center.
That front and center, I thinkthat there is going to be an
important role for institutionsto rethink their practices and
rethink their cost structures.
(39:57):
I think we are going to seethat there are going to be
tighter budgets.
One of the things I listened toyour last podcast with Ted
Mitchell, who I loved the way hesaid the schools that are going
to survive are going to be theschools that are
student-centered, that aren'tadult-centered, and I just
thought that was brilliant and Iwant to paint that everywhere,
(40:18):
because I think that is what weneed to be focused on right now
is how do we then meet studentswhere they are and help them,
and so I think one of the thingsthat we are doing at Arnold
Ventures, we are investingheavily in scaling the CUNY ASAP
model.
Speaker 1 (40:39):
The.
Speaker 2 (40:39):
ASAP model is really kind of the gold standard in
terms of improving communitycollege completion rates, and
the beauty of it, the magic ofit is it meets students where
they are.
It meets students where theyare.
It gives them the support thatthey need, and what we're doing
it with our most recentreplication effort in North
Carolina is we are helping togive them those supports in
(41:03):
programs that have high wage,high demand outcomes that are
going to deliver.
Like we are keeping our promiseto you, you, as the students,
are trusting us with your time,your money to come to this
program.
We're going to give you thesupports that you need to
complete a credential that isgoing to set you up for economic
(41:26):
mobility long term.
I think we need more focus onthat.
How are we meeting studentswhere they are, giving them the
tools that they need and thenteeing them up for success, as
opposed to hiding the ball aboutwhat their outcomes are going
to?
Speaker 1 (41:43):
be long term Agreed and my colleagues at MDRC will
be very happy to hear howenthusiastic you are about ASAP.
So let me ask you this Is thewhole conversation about debt
forgiveness over for the timebeing.
Speaker 2 (42:02):
I do, yes, yes, I do think that it is.
I am glad that it is veryfrankly, because I think that
debt forgiveness was animportant symptom.
It was addressing a real needbut it was going to put a
Band-Aid on the root cause tothe very, very real challenges
(42:28):
that a lot of student borrowersare facing.
I think that there was anopportunity I hope an
opportunity reemerges where wecan have kind of a grand bargain
conversation where we recognizefor some borrowers who have
been in repayment for decades,who have seen huge negative
(42:49):
amortization of their loan,their balance keeps growing that
they are never going to be ableto pay it off.
I think that there is.
We need to have somerecognition that at some point
it becomes not just like wrongbut silly to try to keep getting
that payment.
(43:09):
But if you tackle that side ofthe equation without addressing
the fact that we are continuingto put people in that situation,
then I think that we wind upreally missing an important
opportunity.
So I do hope that we are ableto have a more holistic
(43:32):
conversation.
I think that for Arnold Ventures, our perspective has always
been that we need to firstaddress root cause issues, and
that is, low-value programs thatare leaving students in debt.
They are never going to be ableto repay.
We believe in putting in placeessentially a gainful employment
for all standard where both anearnings threshold and making
(43:56):
sure that there are that youhave an appropriate debt to
earnings ratio so that you canrepay that debt.
If we can cut that, if we canstop people on the front end
from going into unmanageabledebt, then we can.
Also.
We can walk and chew gum.
At the same time, we can alsothink about how do we address
those people who have been inrepayment for so long, as well
(44:21):
as those who have been defraudedby predatory institutions.
Speaker 1 (44:26):
Yes, well, I certainly agree.
Let me ask you one lastquestion as we begin to wrap up,
kelly.
Your organization has beenworking very hard over the last
several years, focused onfederal policy.
I know you're in states as well, but I've had several guests on
the show, particularly one whohas questions about the
(44:49):
influence of Arnold Ventures inDST, particularly in the Biden
administration, and how do yousee your role going forward at
Arnold Ventures and what's thefuture for your organization and
your shop look like goingforward?
Speaker 2 (45:06):
Well, I wish that we had the influence that that
guest ascribed to us.
I would have been able to get awhole lot more done.
I think that for ArnoldVentures, our focus is in the
moment and again on June 27th,what is first and foremost is
(45:29):
this reconciliation bill, but Ithink, as I mentioned earlier,
implementation is going to be sokey and there's going to be
such an opportunity for thehigher ed policy, community
institutions and really peopleon both sides of the aisle to
come together and figure out, ok, how do we implement this in a
(45:49):
way that works?
My biggest fear is that,because this is reconciliation,
which is, by definition, apartisan exercise, that
Democrats say you know, we wantnothing to do with that.
I get that instinct and I thinkthat a lot of the higher ed
accountability policy inparticular, that has bipartisan
(46:13):
roots and bipartisan interestand a bipartisan need to get it
right, and so I am reallyhopeful that we are able to
bring together a conversationabout where we go from here, how
we build on this, how weimplement effectively and,
similarly, I think there isgoing to be a lot of thinking
(46:34):
that needs to be done.
Given the shell that is now,what resources do they need?
How do we make sure that thisis able to be implemented
effectively Because, as you knowvery well, getting the policy
across the line, that's like 5%of the job.
The 95% is how it isimplemented.
(46:56):
So that's where, from thefederal lens, where we are
thinking a lot about our workmoving forward.
And then, as you mentioned, wesee a huge opportunity at the
state level.
We've been working andidentifying best ways to partner
with states to help themidentify for their states what
(47:16):
are the credentials of value,what are those credentials and
programs that lead to realeconomic mobility and meet labor
market needs, and then what arethe policy levers that you can
use to incentivize those.
So, thinking about fundingformulas and the things that I'm
thinking a lot about right nowis academic program approval and
(47:38):
review, like how do we spin upnew programs and how do we look
at the programs that exist andsay, especially in times of
budget crises, like, why are wespending our dollars on programs
that don't provide economicmobility?
So I think that there's a lotof opportunity there and we're
(47:58):
really excited to be partneringwith some states to think about
that and state advocates.
Then, finally, a big chunk ofour work and part for me as a
North Carolina girl that hasbeen very, very close to my
heart, is thinking about ourwork on scaling effective
practices, and so, you know, inFebruary we launched the ASAP
(48:23):
replication in North Carolina.
That's going to serve 15community colleges across the
state.
We are going to start they aregoing to start serving students
in August.
We are so excited to see kindof where that goes and we are
very actively exploring.
Are there other states?
Are there other bigmetropolitan areas that might be
(48:45):
ripe for that type of catalyticinvestment?
And I think that one of thethings that makes me most
hopeful in this moment and Iknow I am chronically like,
maybe naively always trying tofind the opportunity and the
optimism, but I think we areseeing so many pockets of
(49:10):
excellence and improvement andgrowth and like real commitment
to students and to economicmobility, and I think that that
is going to.
We are going to be tested onour commitment to that, I think,
as budgets get tight, but I'mreally hopeful that we are
seeing the necessity of highered to evolve and change and
(49:35):
truly embrace student success,as opposed to just saying it but
then actually being moreconcerned about revenue but
really embracing student success.
And that's what I'm mostexcited about moving forward.
And and that's what I'm mostexcited about moving forward.
Speaker 1 (49:52):
Well, on that very hopeful note, I want to say
thank you, kelly, for taking thetime to join us here on the
Rant podcast.
I know that this is a crazybusy time for you, so thank you
for your leadership and for yourteam's work and thank you for
being on the Rant podcast.
Speaker 2 (50:10):
Thank you so much.
I really appreciate it and I'mexcited to continue working with
you.
Speaker 1 (50:13):
Absolutely.
There'll be plenty of work todo so.
Thanks for joining us everybody.
You've been listening to myconversation with Kelly McManus,
Vice President of HigherEducation at Arnold Ventures.
You've been listening to theRAND podcast.
If you're watching us onYouTube, please hit subscribe,
and if you're following us onaudio, continue to find us on
(50:36):
your favorite podcast platform.
Thanks for joining us,everybody, and we'll see you all
soon.
Thank you.
Hi, this is Eloy Ortiz-Oakley and welcome back to
the Rant Podcast, the podcastwhere we pull back the curtain
and break down the people, thepolicies and the politics of our
higher education system.
And we're talking politicstoday.
We're talking about PresidentTrump's reconciliation bill
that's before Congress as wespeak.
(00:30):
At the time of this recording,the Senate had just passed its
version of the reconciliationbudget proposal and sending it
back to the House.
We're going to focus on theportion of the budget that is
specific to higher education.
So, specifically, the proposalthat came out of the HELP
Committee and with me to talkabout it is Kelly McManus, vice
(00:55):
President of Higher Educationfrom Arnold Ventures.
Arnold Ventures is aphilanthropy in Washington DC
focused on a number of policyissues, including higher
education.
They've done quite a bit ofwork on higher education policy
and are considered to be one ofthe more influential
philanthropies on highereducation in Washington DC today
(01:17):
.
So Kelly will sit down with meand we'll talk about the
reconciliation budget, thedifferences between the House
version and the Senate versionand what we expect will be in
that final package as it makesits way to the President's desk.
Before we get into that, I justwant to give my quick take.
While there are a lot of piecesof this reconciliation budget
(01:39):
that are hard to swallow,particularly when it comes to
Medicaid and other programs forlow-income Americans, plus
numerous tax cuts that favor themore wealthy in this country,
the reconciliation budget thatis focused on higher education,
I believe, actually has somevery positive elements to it,
(02:02):
particularly aroundaccountability.
Very positive elements to it,particularly around
accountability.
Accountability as it relates tothinking about earnings to debt
ratios for graduate programs,ending the grad plus loan
program and putting a greaterfocus on value, measuring value
in higher education and ensuringthat students are not left
(02:23):
worse off than they would havebeen by enrolling in a program
of study.
There's been a lot of movementover the last few years to focus
on measuring value, beginningin the Biden administration and
now moving forward into theTrump administration.
So we're going to focus on thatelement and I believe this will
set the stage for measuring anew way, beyond completion,
(02:47):
beyond access, and moving towardvalue.
Moving toward ensuring thatindividuals who enter a program
of study and who are sold a billof goods for that program of
study and that's typically a jobat the other end of it, good
earnings on the other end of it,improving your life and the
life of your family on the otherend of that program.
(03:09):
Now we're going to have a systemthat begins to focus in on how
to measure that, and while thereare still some flaws in this
bill and many of my colleaguesthroughout higher ed policy will
point those out it does set thestage for a new way of
measuring value in highereducation.
And the work then begins afterthis bill is signed into law,
(03:31):
which I expect it will be by thetime this podcast airs.
The work begins on theimplementation, to ensure that
the implementation is done rightand that we follow through with
other pieces of cleanuplegislation that continue to
focus on improving the highereducation ecosystem.
And, of course, at the top ofthat list will be the
(03:54):
reauthorization of the HigherEducation Act.
So we'll have much more to sayabout that in future episodes,
but for now, please enjoy myconversation with Kelly McManus,
vice President, higherEducation at Arnold Ventures.
Kelly, welcome to the Rantpodcast.
Speaker 2 (04:12):
Thank you for having me.
I'm so excited to be here.
Speaker 1 (04:18):
Well, it's great to have you.
It's about time we had you onthe podcast.
Thank you for all the work thatyou're doing there in DC, and
let's talk about that work.
So, for our listeners who arenot very familiar with Arnold
Ventures and they must be livingunder a rock, assuming that our
listeners are familiar withyour organization tell us a
(04:45):
little bit about the history ofAV and about your work and what
your vision for the future ofhigher education is going
forward.
Speaker 2 (04:50):
Absolutely Well and, before I jump in, I would be
remiss if I didn't thank you forall of your leadership in the
field.
I was actually talking with oneof my team members this morning
who started her career at CalState Long Beach this morning,
who started her career at CalState Long Beach, and she said
that you are the leader that sheoften looks to when she needs a
(05:10):
good moral compass and whatgood leadership is, and so I am
just very grateful for all thatyou've done and thrilled to have
you leading College Futures nowI think you've got a fantastic
team who I love partnering with,so I appreciate all that you do
.
Speaker 1 (05:26):
Well, thank you.
Speaker 2 (05:28):
So Arnold Ventures is the philanthropy of Laura and
John Arnold, and when theArnolds set out on their
philanthropic journey, theyreally wanted to understand what
programs worked, what programshad evidence of rigorous impact,
and then how could they deploytheir resources to help those
(05:50):
programs.
What they found was that, veryfrankly, most programs don't
have evidence of rigorous impactand we need significantly more
research to understand whatworks.
So Arnold Ventures has grown tobe a philanthropy that
primarily focuses on researchand policy.
We invest in reallyunderstanding the root cause of
(06:13):
some of the most pressingproblems facing our country,
including work in education,which is where the higher
education portfolio lives, butalso in infrastructure, in
public finance, healthcare,criminal justice.
So our higher educationportfolio here at Arnold
Ventures really focuses onmaking sure that students are
(06:37):
better off.
Students who choose to go tohigher ed are better off than
they otherwise would have beenif they hadn't gone to higher ed
at all, and unfortunately, Ithink that's an aspiration that
we could all share, but for toomany students right now that
isn't true.
They aren't completing, or theyare completing and are finding
(06:59):
that the credential that theyhave worked so hard for doesn't
have value in the labor market.
So our focus is on making surethat when a student makes that
investment in their future, thatwe're doing our part as the
higher ed community to make surethat that student has the
opportunity to attain theeconomic mobility that they are
(07:21):
really going for.
And so Arnold Ventures inhigher education invests in
research.
We invest in policy development, invest in advocacy when
necessary and litigation, and inscaling evidence-based programs
to help ensure that morestudents are able to complete
and are also really focused onrecognizing that this is going
(07:45):
to be even more true and I knowwe'll get into this but, as
we're going to see tighterbudgets coming forward making
sure that every dollar that wespend in our public system is
focused on student success andsetting students up for the
economic mobility that wecollectively promised them.
So that's our vision for highereducation Every student is
(08:07):
better off than they otherwisewould have been and all of our
public dollars are flowing in away that can drive that outcome.
Speaker 1 (08:15):
Let me pull on that thread a little bit because, as
I'm sure you well know, that iscertainly a thread that we are
pulling on here at CollegeFutures for California, for all
of our institutions inCalifornia, wanting to get the
greatest value possible to thelearner, to the consumer, who
(08:47):
has every right to demand thatthey get as much as possible for
the dream that they'reinvesting in, the dream that we
sold to them.
Yes, so this whole notion ofmeasuring higher education
differently, thinking abouteconomic mobility, how do you
see the landscape shifting rightnow and do you see that this
movement is picking up momentum?
(09:07):
Do you see institutionsstarting to think differently
about it?
Speaker 2 (09:12):
I am actually very excited about where we are
seeing the conversation go andalso where we're starting to see
policy and practice evolve.
Starting to see policy andpractice evolve.
And so one of the things thathas emerged over the past decade
or so, as you mentioned andthat you have been an integral
(09:33):
part of, is this focus on value.
And I think what is mostexciting for me is when you look
at the policy conversationaround value, it has truly
become bipartisan.
There is an emerging bipartisanconsensus.
There was.
You know, we started two yearsago, 2023.
(09:55):
We had the Biden administrationthat was finalizing the gainful
employment and financial valuetransparency rules.
We're saying you know what?
Like, if you actively leavestudents worse off, you don't
get access to our public dollarsanymore.
Like, we have almost a do noharm principle and but that
(10:16):
could only because of the waythat the HEA is written, that
could only apply to somecolleges and programs.
And what you saw at the sametime, that same summer, 2023,
you had Senators Cornyn andCassidy introduce higher
education package that in manyways, mirrored that same
principle that was focusing ondo no harm, if you actively
(10:39):
leave students worse off, youdon't get access to our public
dollars.
And what you're seeing now isthat in reconciliation which
just for a listener we are rightin the middle of it.
Who knows where things?
Speaker 1 (10:54):
go.
Speaker 2 (10:55):
But that principle is currently reflected in the
Senate reconciliation package,and so I think that there is a
really exciting coming togetherof that.
I think there's still likepolicy is nuanced and there is
going to be a lot of work thatneeds to be done to make sure
(11:16):
that whatever passes getsimplemented in a way that
actually delivers on the promisethat we aren't going to make
you worse off.
I think at the same time, we'reseeing in states in both red
and blue states more stateleaders thinking about
credentials of value, thinkingabout how you can incentivize
(11:37):
those.
In Texas, the community collegesystem has developed a really
exciting new funding formulathat is focused on how do you
lead students to aself-sustaining wage in the
state, and then you see otherblue states that are exploring
that exact same conversation.
Governor Polis in Colorado iscurrently working on a way to
(12:00):
think about economic mobility asa part of their finance formula
, and so one of the things thatI think that unites us all we're
all going to have disagreementson the how is this the right
bar?
What metric works?
Arnold Ventures?
We have invested a lot inresearch to help answer some of
those questions, but at leastwhat we see as most exciting is
(12:24):
that we know the history ofreforms in this country.
The most durable ones are onesthat are bipartisan.
And this is an area where thereis an opportunity to really
grow a bipartisan movement.
Speaker 1 (12:38):
Well, I certainly agree that there is
bipartisanship around this issue, and I hope my colleagues who
are leaders in higher educationunderstand that that this is not
an issue that's going away.
This is an issue that's goingto fundamentally lead into the
way that we think aboutmeasuring higher education, just
as we did with completion.
Absolutely this is in my view,just the next step.
(12:59):
Let's jump into what'shappening right now.
So let's jump into what'shappening right now and, given
that we are recording thisinterview, at the end of June,
the Senate is wrestling with itsversion.
(13:22):
Committee's reconciliation billproposal for higher education
looks like, and some of thethings that you're keeping an
eye on.
Speaker 2 (13:30):
Sure, and one thing again as a disclaimer I will say
this is as of this.
Second, what is in the bill?
There is a chance that evenwithin the time that we are
recording this, it will havechanged, so please don't hold me
to any specifics.
But essentially, what SenatorCassidy has put together for the
(13:55):
HELP package and reconciliationis thinking about how do we
spend our dollars in higher ed,and the biggest chunk of money
that we spend through the HEA isin title work, and so it's
thinking about how do we giveout Pell Grants, how do we give
out loans, how do we get, how dostudents repay?
So what Senator Cassidy has puttogether is a package that we
(14:18):
think advances the conversationabout how we can best structure
our dollars in higher ed.
There are a couple big bucketshere.
First, it changes our studentloan repayment system.
This is the biggest bucket.
This comprises a significantportion of the dollars that this
bill is seeking to save, and itcreates a new repayment plan, a
(14:43):
new income driven repaymentplan for students and then also
a new standard plan for students.
The original bill would havethat apply to all current
borrowers and new borrowers.
As of 24 hours ago, theapplication to current borrowers
got bounced out by the Senateparliamentarian and so there are
(15:07):
some real questions here aboutwhat happens for current
borrowers.
But presumably, moving forward,the borrower will have two
options for repayment.
So that's one big bucket.
That's in the bill.
Second big bucket is changes toloan limits, and this is at the
both undergrad or this is atthe graduate level.
(15:30):
At the house included changesto the undergrad limits.
The Senate is focused on thegraduate level, so the bill
would end the Grad Plus programthat was created in 2006, but
would increase the amount ofeligibility for graduate
(15:51):
Stafford loans to $100,000 formaster's programs and $200,000
for professional programs.
So that's kind of another bigbucket of change.
And the third big bucket ofchange is around title war
eligibility based on outcomesprogram leave your students,
(16:12):
leave more than half of yourstudents worse off than the
typical high school graduates inyour community.
You don't get access to TitleIV dollars anymore.
(16:33):
Students are not going to go indebt for your program anymore
and I think that that's again areally important sea change
policy that we will need tocontinue working on in
implementation.
I think one of the things that Ilike to remind people is the
last time the HEA wasreauthorized in 2008,.
(16:53):
That was on the back of areconciliation bill in 2007.
Give more nuance, give morecleanup.
I think that there is going tobe the need and the opportunity
for us to have bipartisanconversations about how we make
sure these new policies areimplemented effectively.
(17:13):
So those are the biggestbuckets in there.
There's also there are otherpolicies in there.
There was, until 24 hours ago,Workforce Pell an expansion of
Pell to very short-term programsbetween eight and 15 weeks.
That was bounced out.
I know that there are effortsongoing now to try to
(17:37):
restructure that so that it cancome back in.
Restrictions on secretarialauthority, including repeal of
the borrower defense and closedschool discharge rules that are
still under consideration fromthe parliamentarian at this
moment.
So we don't know whether thoseare going to make it in and I
(17:58):
think that those are areas.
You know.
Arnold Ventures has investedfor a long time in making sure
that students who have beendefrauded have recourse and in
our ideal world, those predatoryinstitutions are held
responsible for that.
As an aside, on borrowerdefense, there has been so much
regulatory ping pong here.
(18:18):
It has changed with everyadministration, Every
administration.
I think we'd like to see a moredurable legislative solution to
give defrauded borrowers a pathto being made whole, and so
that's something we're going tobe thinking about in this
potential cleanup bill, shouldreconciliation pass.
So those are kind of the bigpieces that are in right now and
(18:41):
again, there is a decent chancethat, while we have been
talking that has changed.
Speaker 1 (18:48):
I haven't looked at my social feed in the last few
minutes, so I will wait untilafter this conversation.
Let me dig in on a couple ofthings that you brought up.
First of all, there is clearly,in my view, a bipartisan
frustration with graduateprograms Absolutely Graduate
(19:09):
programs.
I've been hearing this.
I was hearing it when I did adrive-by in the Biden
administration.
I've heard this ever since.
I hear it from my Republicancolleagues, I hear it from
Democratic colleagues, and soI'm not surprised that Congress
is trying to do something aboutit.
I do think it's time.
(19:32):
There's a question in my mindand maybe you can answer it, and
this is an in the weedsquestion because of my time on
the UC Board of Regents and thetime I've spent with some of our
four university colleagues.
What I have found is, over thelast 10 years, there's been a
rush to make every graduateprogram a professional program,
(19:52):
for a variety of reasons.
One is most universities chargedifferential fees for
professional programs, sothere's been a proliferation of
professional programs.
Is not just the MD, the JD andthe MBA anymore Right?
How, in the current write-up inthe bill, how does Congress
(20:13):
plan to deal with these twoissues?
Does it specify what aprofessional program is.
Speaker 2 (20:18):
So a professional program is specified in the HEA.
I think this is one of the veryinteresting things that we have
looked at internally as we'vebeen trying to unpack these
policy proposals.
There's a whole category ofprofessional programs that are
in theology and one thing weknow is theology degrees.
(20:41):
You don't go into theology tomake money, you go in for a
different calling.
Speaker 1 (20:47):
Well, we've seen some variations of that.
Speaker 2 (20:50):
Yes, well, that is true, that is true, and so I do
think that this is the type ofpolicy nuance that I think
reconciliation is not the rightvehicle to address and why I
really hope that there is aopportunity for a bipartisan
cleanup.
Hea reauthorization after this,because the House version the
(21:17):
bill had one hundred and fiftythousand dollar cap for
professional programs.
There was a lot of pushbackfrom medical schools in
particular on that, and so theSenate version has a two hundred
thousand dollar cap forprofessional programs.
But what we have found inlooking at the data, first of
all from the Arnold Venturesperspective, we think that,
(21:40):
setting a cap, we are having theright conversation the Senate
and the House.
They have identified the rightissues that demonstrated that
the uncapped nature of Grad Plusled to an increase in 50 cents
(22:04):
on every dollar that was moreavailable.
So cost is going up.
At the same time, access is notincreasing, and that's what we
want.
We want people to be able toaccess graduate programs that
they need, that pay off programsthat they need, that pay off
(22:26):
and grad plus isn't working todo, and so they are addressing
the right issue and we arereally excited that this
conversation is happening,especially, as you know, we're
now at 46 percent of all federalloans are graduate loans.
So we need to be addressingthis issue.
(22:56):
Earnings ratio that would guidelimitations, because there are
some particularly medicalprograms and also some law
programs where that it does costmore than $200,000.
But those people pay off theirloans.
Those are good investments andso we don't want to limit access
to those high paying, highvalue programs.
(23:19):
At the same time, a $100,000limit for some for master's
degrees might be way too highfor some master's degrees.
We've seen the proliferation ofmaster's degrees that don't pay
off and I think that that's whatworries me is that we are still
setting up a system,potentially, where students are
(23:42):
going to think that they'redoing the right thing, they're
going to get the signals I needto go to grad school, I need to
get this master's Universitiesare still going to see that as a
revenue growth opportunity.
I think one of the morehorrifying headlines I've seen
recently around this is whenBrown University, an Ivy League
school, one of the best in thecountry came out and said in the
(24:05):
headline that we so.
I think that there is a veryreal need to address this issue.
I think that, though a debt toearnings.
(24:27):
Where it can go lower, it maybe and we can really focus on
turning the cost curve andmaking sure that programs are
delivering meaningful valuewhile also enabling access to
the high value programs ispotentially a better way to go,
but again, that's not somethingthat you can do.
Have that nuance andreconciliation.
That'll be something that weare working actively on
(24:49):
exploring after we get throughthis little bit.
Speaker 1 (24:54):
Well, after we get through this little bit, there's
still a lot of work to do.
Yes, a lot of work to do, yes.
So let me ask you anotherquestion that you brought up
ending Title IV access forinstitutions that leave students
worse off than they otherwisewould.
I think a lot of people agreewith that notion certainly one
(25:19):
of them but there's also a lotof people who doubt the
execution of that penalty.
Essentially, it's a penalty.
I've had my experiences whereI've had an institution that I
oversaw in California, who wasegregious, who was doing some
horrible things in terms ofquality, but given their
relationship with the leadershipin the House, there was going
(25:43):
to be nothing I could do aboutit.
I mean, there are a lot ofpeople who doubt that we would
actually end Title IV access toan institution.
What do you think the sentimentis in Congress right now about
that?
Speaker 2 (25:56):
I think that our history is not great in this
regard.
I think if you look back at the1992 HEA reauthorization, in
some ways I mean that was reallya high mark for real
accountability.
It certainly had flaws, but hadreal accountability, had an
impact.
(26:16):
There is research showing thatit drove down default rates,
that it had an impact, and thenby the late 90s there is a lot
of political pressure to waterit down, and I certainly think
that there is.
That is a shell of its formerself.
That one of the things that isincumbent upon those of us who
(26:47):
have been thinking about policyand working on these policies
for so long is we cannot walkaway afterwards.
Implementation is going to haveto be as important as all of
the research, the policydevelopment, the advocacy, the
community, everything that hasled us to focus on value.
If we drop the ball and wedon't actually implement
(27:11):
policies, we're still lying topeople.
We're still lying to studentsand saying, oh, don't worry,
we've taken care of the issues,while students are still not
being served well.
So I think it is incumbent onus as funders, as people in the
policy space, to keep an eye onthat.
But one thing I think that theSenate has done.
(27:32):
That is really, reallyimportant and that is important
for higher ed broadly to reallyknow is that they are looking at
programmatic accountability andso it is program by program.
There are very few institutionswhere every single program is so
.
I think the fact that we are,it is much easier to tell an
(27:54):
institution you need to stopenrolling students in that
program.
Then institutions can movethings around, they can develop
new programs, they can identifywhich programs have higher value
.
How do they shift that?
There's still a lot of agencyand there is less political
pressure to shut downinstitutions.
I think that has been one ofthe challenges that the
(28:17):
accountability movement hasfaced over the past decade.
Is this question of like, well,you're going to shut down
institutions?
No, we're saying that you knowan institution needs to look at
their programs, and we're seeingsome of this at the state level
too, where states are askinginstitutions look at your
programs, look at the outcomes,where is their value?
(28:37):
And how are we making sure weare sunsetting the programs that
are consistently leavingstudents worse off while
investing in those that offerreal economic mobility?
Speaker 1 (28:49):
I think that's a great point.
Going after program leveloutcomes, I think, would be a
lot more realistic in thecurrent environment.
Now let's let's talk about someof the differences between the
House and the Senate version.
There are some specificdifferences in Pell eligibility.
Absolutely, and given theappetite, particularly in the
(29:14):
House, to reduce the cost, goingforward as much as possible,
how do you see the Senatereconciling the cost of Pell
with the House?
Speaker 2 (29:26):
I think I wish that we were able to have this
conversation and 24, 48, 72,some number of hours from now,
because I think this is a reallyactive conversation.
I was very happy to see, Ithink, that what we saw in this
so the Senate bill did not makeany of the changes in Pell
(29:48):
eligibility that the House did Ithink that's the result, very
frankly, of some really strongstorytelling and advocacy,
particularly on the part ofcommunity colleges, who would
have been disproportionatelyimpacted, given the number of
part-time students that theyserve.
There is a long-time bipartisansupport for Pell as the
(30:13):
foundation of our investment ineconomic mobility in this
country, but the reality is thatPell is facing a shortfall If
we go into, if we are headedinto, a recession historically,
when we have a recession, morepeople go back to school and
that puts much more pressure onPell and so I think that both
(30:37):
the Senate and the House haveincluded dollars that
immediately plug the Pellshortfall for the short term.
But what we have to have abigger conversation about, and
what the House tried to do, wastry to address that fundamental
long term sustainability of theprogram.
At the same time, you know,both the Senate and the House
(31:01):
proposed workforce Pellexpansions and I think, seeing
that, while seeing the shortfallthat, yes, like both bills are
addressing in the immediate termbut not, you know we're going
to be still having a shortfallconversation in two years, three
years from now, I was flashingback to what we did with
(31:22):
year-round Pell, where we gaveit and then we took it back.
Fortunately, we were able tothen give it back again, but I
think that when there is a Pellshortfall, things get cut,
eligibility gets cut, and so weneed to have a broader
conversation about Pellsustainability over the long
term.
And I think it's also time forus to do more thinking about,
(31:45):
like, what is the purpose ofPell versus what are there?
Are there programs that arebetter served, especially some
of the short term trainingprograms, like could those be
funded through WIOA, recognizingthat WIOA is much, much less
heavily funded than Pell?
Like, I'm not suggestingthere's a one-to-one answer
there, but I do think we need tohave conversations as a higher
(32:08):
ed community about Pell,especially as its value and
buying power has continued toerode.
Speaker 1 (32:16):
Agreed and I think there's a lot of support for a
workforce Pell type program.
But, as you mentioned, thechallenge is always how do you
fund it and do you take it outof Pell?
Do you reduce eligibility onone end, increase eligibility on
the other end?
So it sounds like ArnoldVenture's position is to find a
(32:39):
different source of fundingoutside of Pell.
Speaker 2 (32:43):
I think that would be our preference, though I would
say I think that largely comesback to the evidence.
We know there are someshort-term programs that do
boost economic mobility.
There are a lot that don't.
This week or last week, therewas a report that came out of
AEI and the Burning GlassInstitute that showed that under
(33:04):
20% of short-term certificateshad that significant earning
power boost.
And so, especially if you arepitting students who are going
to whether it's a non-degreecredential but 15 to a year
certificate, an AA, a BA, if youare pinning those against each
(33:24):
other and fighting for the samefunding, like we would prefer
that the dollars follow theprograms that have the greatest
evidence of impact.
In a world in which we live,which is a world of limited
resources, In our perfect world,would everyone have every
opportunity?
I think that this is going tobe especially true as we look at
(33:44):
tighter budgets, unlike 2020,unlike 2008.
Like, I don't see a big influxof new money kind of coming down
the pike, and so institutionsstates they're going to have to
make hard decisions.
Institutions states they'regoing to have to make hard
decisions, and our hope and oneof the things that we are
(34:05):
actively thinking about is howdo you protect value in that
time?
How do you preserve theprograms that have evidence of
economic mobility, evidence ofleaving students better off?
And, when it comes to, how dowe shift funding to those
programs in a world in which wecan't fund everything?
Speaker 1 (34:25):
Yeah, Now there is continued debate about where the
federal role begins and endsand where the state role begins
and ends On this question ofworkforce credentials.
There's an argument out therethat states are in the best
position to figure out whichcredentials create the most
(34:46):
value for their local and stateeconomies.
How do you see the balancebetween the federal and state
role working itself out in thiscontext?
Speaker 2 (34:56):
This is where I get into.
I started my career doing statelevel policy work.
I do believe that states arethe laboratory of democracy.
We at Arnold Ventures have beenbuilding out our engagement
states and are doing some reallyexciting work in North Carolina
and Texas, colorado, tennessee,some other places that where we
(35:18):
see a lot of excitement, a lotof experimentation of how much
we need to learn aboutshort-term credentials, which
ones pay off, what are thefeatures?
Is it you know how muchwork-based learning, what is the
appropriate dosage Like?
(35:41):
There's so much that we need tolearn about what is an
effective credential and it issuch a localized thing that this
is where I think states reallyneed to be kind of in in the
driver's seat.
I think that states are, and soI think that you know.
That is something where both theSenate and the House version of
Workforce Pell inreconciliation included a role
(36:05):
for governors.
I think that in all of ourconversations that we are having
with governors, they arethinking about this and so I
think that that's an appropriaterole.
But where I think that thefederal government can't walk
away is on the data and theresearch is going to be able to
(36:34):
drive effective data collection,data analysis research at the
scale we need than the federalgovernment, and I know we fund
at Arnold Ventures we fund asignificant amount of research
and it is a drop in the bucketcompared to what is needed and
what the federal government canand should be doing.
Our founder and co-chair, johnArnold, has talked extensively
(36:54):
about how philanthropy can'tfill the gap here.
You know, and I think that thatis one of the things I'm sure
that you at College Futuresy'all are trying to wrestle with
too is like what is the role?
And so this is where I think weneed to be clear that the data
collection, analysis, researchon what works and then providing
(37:17):
the support to help states makethose decisions, I think is the
right federal role of some ofthese changes to low-income
learners, first-generationlearners, communities of color.
Speaker 1 (37:37):
There's a lot of concern that the changes or the
elimination of things like GradPlus will impact the ability of
diverse students to accessprograms.
There's concern about some ofthe proposed changes to Pell,
although less so now in theSenate version, but a number of
(37:57):
advocates for low-incomelearners first-generation
learners are concerned about thecurrent reconciliation budget.
What should advocates for thoselearners be focused on and what
kind of advocacy would yourecommend to them at this moment
in time?
Speaker 2 (38:16):
I think that one of the things that I have found to
be kind of most challenging inthe higher education space is
that we do when we areadvocating for low-income
students, when we are advocatingfor low-income students,
(38:47):
students of color,first-generation students.
Too often I'm in conversationswhere there isn't an
acknowledgement that right now,too many of those students are
upon by predatory schools thatare selling a bill of goods that
that are never going to pay off, that too many of them are are
be I don't have the, theadvising, the support that they
need to navigate, like, what arethe programs that are going to
actually deliver value?
To me?
When I think about particularlythe accountability side, that
(39:12):
is like I come at that from alike how do we make sure that,
at a bare minimum, particularlylow-income students,
first-generation students, aregoing to be worse off Like that?
That to me is a fundamental andI think that sharing that,
starting with that value, thatlike, we want to at a minimum
make sure that what students areaccessing, especially when they
(39:36):
are the first in their familiesto do it, that they are
accessing something that hasvalue.
And so I think advocates reallyneed to start with that front
and center.
That front and center, I thinkthat there is going to be an
important role for institutionsto rethink their practices and
rethink their cost structures.
(39:57):
I think we are going to seethat there are going to be
tighter budgets.
One of the things I listened toyour last podcast with Ted
Mitchell, who I loved the way hesaid the schools that are going
to survive are going to be theschools that are
student-centered, that aren'tadult-centered, and I just
thought that was brilliant and Iwant to paint that everywhere,
(40:18):
because I think that is what weneed to be focused on right now
is how do we then meet studentswhere they are and help them,
and so I think one of the thingsthat we are doing at Arnold
Ventures, we are investingheavily in scaling the CUNY ASAP
model.
Speaker 1 (40:39):
The.
Speaker 2 (40:39):
ASAP model is really kind of the gold standard in
terms of improving communitycollege completion rates, and
the beauty of it, the magic ofit is it meets students where
they are.
It meets students where theyare.
It gives them the support thatthey need, and what we're doing
it with our most recentreplication effort in North
Carolina is we are helping togive them those supports in
(41:03):
programs that have high wage,high demand outcomes that are
going to deliver.
Like we are keeping our promiseto you, you, as the students,
are trusting us with your time,your money to come to this
program.
We're going to give you thesupports that you need to
complete a credential that isgoing to set you up for economic
(41:26):
mobility long term.
I think we need more focus onthat.
How are we meeting studentswhere they are, giving them the
tools that they need and thenteeing them up for success, as
opposed to hiding the ball aboutwhat their outcomes are going
to?
Speaker 1 (41:43):
be long term Agreed and my colleagues at MDRC will
be very happy to hear howenthusiastic you are about ASAP.
So let me ask you this Is thewhole conversation about debt
forgiveness over for the timebeing.
Speaker 2 (42:02):
I do, yes, yes, I do think that it is.
I am glad that it is veryfrankly, because I think that
debt forgiveness was animportant symptom.
It was addressing a real needbut it was going to put a
Band-Aid on the root cause tothe very, very real challenges
(42:28):
that a lot of student borrowersare facing.
I think that there was anopportunity I hope an
opportunity reemerges where wecan have kind of a grand bargain
conversation where we recognizefor some borrowers who have
been in repayment for decades,who have seen huge negative
(42:49):
amortization of their loan,their balance keeps growing that
they are never going to be ableto pay it off.
I think that there is.
We need to have somerecognition that at some point
it becomes not just like wrongbut silly to try to keep getting
that payment.
(43:09):
But if you tackle that side ofthe equation without addressing
the fact that we are continuingto put people in that situation,
then I think that we wind upreally missing an important
opportunity.
So I do hope that we are ableto have a more holistic
(43:32):
conversation.
I think that for Arnold Ventures, our perspective has always
been that we need to firstaddress root cause issues, and
that is, low-value programs thatare leaving students in debt.
They are never going to be ableto repay.
We believe in putting in placeessentially a gainful employment
for all standard where both anearnings threshold and making
(43:56):
sure that there are that youhave an appropriate debt to
earnings ratio so that you canrepay that debt.
If we can cut that, if we canstop people on the front end
from going into unmanageabledebt, then we can.
Also.
We can walk and chew gum.
At the same time, we can alsothink about how do we address
those people who have been inrepayment for so long, as well
(44:21):
as those who have been defraudedby predatory institutions.
Speaker 1 (44:26):
Yes, well, I certainly agree.
Let me ask you one lastquestion as we begin to wrap up,
kelly.
Your organization has beenworking very hard over the last
several years, focused onfederal policy.
I know you're in states as well, but I've had several guests on
the show, particularly one whohas questions about the
(44:49):
influence of Arnold Ventures inDST, particularly in the Biden
administration, and how do yousee your role going forward at
Arnold Ventures and what's thefuture for your organization and
your shop look like goingforward?
Speaker 2 (45:06):
Well, I wish that we had the influence that that
guest ascribed to us.
I would have been able to get awhole lot more done.
I think that for ArnoldVentures, our focus is in the
moment and again on June 27th,what is first and foremost is
(45:29):
this reconciliation bill, but Ithink, as I mentioned earlier,
implementation is going to be sokey and there's going to be
such an opportunity for thehigher ed policy, community
institutions and really peopleon both sides of the aisle to
come together and figure out, ok, how do we implement this in a
(45:49):
way that works?
My biggest fear is that,because this is reconciliation,
which is, by definition, apartisan exercise, that
Democrats say you know, we wantnothing to do with that.
I get that instinct and I thinkthat a lot of the higher ed
accountability policy inparticular, that has bipartisan
(46:13):
roots and bipartisan interestand a bipartisan need to get it
right, and so I am reallyhopeful that we are able to
bring together a conversationabout where we go from here, how
we build on this, how weimplement effectively and,
similarly, I think there isgoing to be a lot of thinking
(46:34):
that needs to be done.
Given the shell that is now,what resources do they need?
How do we make sure that thisis able to be implemented
effectively Because, as you knowvery well, getting the policy
across the line, that's like 5%of the job.
The 95% is how it isimplemented.
(46:56):
So that's where, from thefederal lens, where we are
thinking a lot about our workmoving forward.
And then, as you mentioned, wesee a huge opportunity at the
state level.
We've been working andidentifying best ways to partner
with states to help themidentify for their states what
(47:16):
are the credentials of value,what are those credentials and
programs that lead to realeconomic mobility and meet labor
market needs, and then what arethe policy levers that you can
use to incentivize those.
So, thinking about fundingformulas and the things that I'm
thinking a lot about right nowis academic program approval and
(47:38):
review, like how do we spin upnew programs and how do we look
at the programs that exist andsay, especially in times of
budget crises, like, why are wespending our dollars on programs
that don't provide economicmobility?
So I think that there's a lotof opportunity there and we're
(47:58):
really excited to be partneringwith some states to think about
that and state advocates.
Then, finally, a big chunk ofour work and part for me as a
North Carolina girl that hasbeen very, very close to my
heart, is thinking about ourwork on scaling effective
practices, and so, you know, inFebruary we launched the ASAP
(48:23):
replication in North Carolina.
That's going to serve 15community colleges across the
state.
We are going to start they aregoing to start serving students
in August.
We are so excited to see kindof where that goes and we are
very actively exploring.
Are there other states?
Are there other bigmetropolitan areas that might be
(48:45):
ripe for that type of catalyticinvestment?
And I think that one of thethings that makes me most
hopeful in this moment and Iknow I am chronically like,
maybe naively always trying tofind the opportunity and the
optimism, but I think we areseeing so many pockets of
(49:10):
excellence and improvement andgrowth and like real commitment
to students and to economicmobility, and I think that that
is going to.
We are going to be tested onour commitment to that, I think,
as budgets get tight, but I'mreally hopeful that we are
seeing the necessity of highered to evolve and change and
(49:35):
truly embrace student success,as opposed to just saying it but
then actually being moreconcerned about revenue but
really embracing student success.
And that's what I'm mostexcited about moving forward.
And and that's what I'm mostexcited about moving forward.
Speaker 1 (49:52):
Well, on that very hopeful note, I want to say
thank you, kelly, for taking thetime to join us here on the
Rant podcast.
I know that this is a crazybusy time for you, so thank you
for your leadership and for yourteam's work and thank you for
being on the Rant podcast.
Speaker 2 (50:10):
Thank you so much.
I really appreciate it and I'mexcited to continue working with
you.
Speaker 1 (50:13):
Absolutely.
There'll be plenty of work todo so.
Thanks for joining us everybody.
You've been listening to myconversation with Kelly McManus,
Vice President of HigherEducation at Arnold Ventures.
You've been listening to theRAND podcast.
If you're watching us onYouTube, please hit subscribe,
and if you're following us onaudio, continue to find us on
(50:36):
your favorite podcast platform.
Thanks for joining us,everybody, and we'll see you all
soon.
Thank you.
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