A recently released report, Undermining Pell from the New America Foundation, charges that colleges are turning their backs on low-income students as they compete for top students with increasingly generous merit-based aid.
To increase their standing on college rankings, more private colleges are giving “merit aid” to top students, who are often affluent, while charging unaffordable prices to the needy, according to the report. The percentage of students receiving merit aid jumped to 44 percent in 2007-2008 from 24 percent in 1995-1996, the report found. To a lesser extent, public universities are using some of the same practices, Burd said.
Increasing merit aid correlates with decreasing minority enrollment.
The report cites other research, including “Keeping up With the Joneses: Institutional Changes Following the Adoption of a Merit Aid Policy” by Amanda L. Griffith.
“It is worrisome, given the already low levels of representation of low-income and minority students at four-year colleges, to find that the introduction of a merit aid policy is associated with a decrease in the percentage of low-income and black students, particularly at the more selective institutions in the sample.”
More federal involvement is recommended.
The New America Foundation proposes a federal “carrot-and-stick” solution. The carrot would be a Pell bonus program aimed at schools serving high percentages of low-income students, increasing benefits to the neediest students with additional funds and programs. And the stick would be a requirement that wealthier schools match a portion of the Pell funds they receive and use these resources to support low-income students.
… A huge proportion of this $40 billion annual federal investment is flowing to people who simply aren’t prepared to do college-level work. And this is perverting higher education’s mission, suppressing completion rates and warping the country’s K-12 system.