Here's what Paul Ryan wants to do about student loans

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Rep. Paul Ryan (R-Wis.) wants to streamline the nation’s student loan system and ultimately reduce the government’s role in higher education.

The former vice presidential candidate included several proposals for higher education in his anti-poverty plan unveiled last week. Ryan, who heads the House budget committee, is considered a short-list presidential contender for the GOP in 2016, which gives his proposals some political weight in Washington.

Here's what you need to know about Ryan's plan:

1) Student aid: He wants to take the current student aid system — a complicated bureaucratic web of programs — and reduce it to three programs: one for grants, one for loans, and one for work study. He also wants to cap federal loans to parents and graduate students.


2) Pell Grants: He supports freezing the maximum Pell Grant at its current rate, which is slightly less than $6,000. He wants to let students access Pell Grants year-round, as opposed to the current system where the grant funding is dispensed twice per year. Ryan claims his plan would give individuals more control over their education and make it easier to finance summer courses, but it also places the onus on students to manage their funding. When the money is gone, it’s gone.

3) College accreditation: Ryan wants to make it easier for the government to approve new college accreditors who can then approve new courses focused on technical skills required for the current job market.

4) Database: Ryan would like to create a database to track how recipients of federal aid perform. Exactly what that database would look like and how it would work are unclear.

5) Competency-based learning: Ryan favors competency-based learning, which would give students credit for skills they already have through previous jobs or from military service.


Big takeaway:

Ryan and fellow GOP lawmakers argue that government involvement in education has led to hikes in college tuition and hindered innovation. His plan proposes to put more power in state hands and allow for experimentation to promote innovation.


Democratic counterpoint:

Democrats have blasted Ryan’s proposals as shortsighted. They argue that reducing the federal government’s role in higher education would hurt vulnerable students, particularly those who come from low-income households or those who are the first in their families to attend college. Democrats argue that limiting Pell Grants and capping other loans could seriously harm poor students’ ability to pursue higher education.



Ryan’s plan to create a database to track performance of aid recipients might generate some agreement among Democrats. Right now, schools receive federal aid regardless of student performance and graduation rates. President Obama and Democrats have supported efforts to hold schools more accountable and reduce student debt. Lawmakers in both parties have backed competency-based learning.


What’s next:

Both parties are looking at ways to reauthorize the Higher Education Act, which deals with the government’s role in higher education. Still, there is little agreement on details and reauthorization is not expected to happen anytime soon. The issues of college affordability and higher education are, however, expected to become hot campaign issues in the run-up to the 2016 election cycle.


Emily DeRuy is a Washington, D.C.-based associate editor, covering education, reproductive rights, and inequality. A San Francisco native, she enjoys Giants baseball and misses Philz terribly.

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