A commonsense plan that Congress can pass now.
As the burden to pay for college shifts more to students and their families, college savings plans, particularly for low-income children, are a potentially important strategy for helping students afford college. At least one study shows that students with a dedicated college savings account in their own name are six times more likely to go to college than their peers without such
One promising model is San Francisco’s Kindergarten to College Program, or K2C, which launched in 2010 and now reaches more than 7,500 students. The program provides every kindergarten student with up to $100 in an individual college savings account that is eligible for matching grants and to which parents, friends, and family can contribute. These accounts are coupled with financial education in the classroom aimed at encouraging students to save and effectively manage their accounts.
At the federal level, Delaware Democrat Chris Coons and Florida Republican Marc Rubio in the Senate have proposed the American Dream Accounts Act, which would authorize the creation of online college savings accounts combined with resources and support aimed at encouraging college savings and preparing students for college.
Invest in programs that work.
Historically, the federal government has sometimes supported programs regardless of whether they actually achieve results. Funding programs that don’t work wastes valuable taxpayer money and fails to help the people at whom the programs are aimed.
Pay-for-performance initiatives included in the reauthorization of the Workforce Investment Act, the Higher Education Act, the Elementary and Secondary Education Act, and other federal education initiatives have the potential to change the status quo by ensuring that federal funding is linked to results and outcomes. Providers get paid only when they achieve the intended results for the people they serve and only to the extent to which they meet performance measures. In return, programs enjoy flexibility, which encourages innovation. One bipartisan example is the Careers Through Responsive, Efficient and Effective Retraining (CAREER) Act, introduced by Ohio Republican Senator Rob Portman and Colorado Democratic Senator Michael Bennet, which would implement a pay-for-performance model for job training programs.
Another promising idea is to create an Enterprising Pathways Innovation Fund. This fund would reward and replicate successful approaches, leverage support from the private sector, and ensure effectiveness by strengthening performance measurement and accountability for results.
Initiatives like these can help guarantee that every taxpayer dollar invested in the future of America’s young people is going toward a program that can truly help them succeed.
We know that in a free society, some inequality is unavoidable, and that people will always differ in skills and ambition. But inequality without the chance for mobility is inefficient and unjust. One’s zip code should not condemn anyone to an inescapable fate. When the American Dream is at risk for some, we all suffer.
Strong federal policies aimed at opening the doors of opportunity will help move the needle for millions of Americans. They are important tools to jump-start the American Dream for the next generation, and make sure our young people have a fair shot at a meaningful life and career in the twenty-first century.
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