Higher Ed Cop Out #2

As promised-- an ongoing series!

Cop-Out #2: Conditional financial aid

There's been plenty written about the unfortunate shift to merit aid, a shift that disproportionately benefits the middle-class. But I've got my eye on another, related yet distinct trend-- "conditional" aid. Last week's New York Times magazine included an article on conditional cash transfer programs that provides nice background here. But in a nutshell, this is aid allocated based on performance-- maintaining full-time enrollment, a certain GPA, etc. The best example, to date, is the program MDRC is running with a lot of support from the Bill & Melinda Gates Foundation-- after demonstrating (very, very small) effects at two New Orleans community colleges, MDRC has ramped up their demonstration in multiple states.

Here's the theory of action: Low-income kids need aid, but also need some accountability requirements in order to do well in college. This is akin to the new paternalism guiding the 1990s welfare reform-- it equates purely need-based aid with a "nanny state" and aid conditional on performance with a "daddy state." If successful, simply because it works it threatens to take over, replacing need-based aid entirely.

So what's the problem-- isn't a successful program a successful program?

I'd argue NO. The move to conditional aid is premature, because we do not yet know whether strictly need-based aid-- given on need, not performance-- is effective at increasing attainment. Moreover, we do not know if current levels of performance are reflective of the underfunding of need-based aid-- the Pell has never been funded at the intended levels, and analysts have been far too quick to jump to the conclusion that it is therefore ineffective.

I'm not surprised at MDRC's involvement in this one-- after all, they're also testing NYC's conditional cash transfer program, and their evaluations were strong impetus for the welfare reforms. But I have the privilege, as an academic, of considering both theory and evidence-- and I'd say the theory thus far -- that simply providing the aid necessary to pay for college-- has not been disproven. Why, then, take a paternalistic approach to requiring things of our low-income college kids that we do not require of the middle-class kids?

Full disclosure: I'm currently co-directing a random assignment evaluation of a need-based aid program. But trust me, this is not simply because the opportunity presented itself, but because this is a strategy I think needs to be tested BEFORE we move to conditional aid "reforms." From an empirical standpoint, not doing so doesn't constitute putting the cart before the horse, but I think from a political and ethical standpoint it unnecessarily opens up a can of worms that need not be opened just yet.

At this point, conditional aid appears to be a cop-out-- a way, perhaps, to gain more middle class support for aid. But might we be just as persuaded by hard-core, gold-standard evidence of large effects of need-based aid? I say, let's start there.

Addendum:

My original post wasn't that well done, I admit. So let me clarify: I call conditional financial aid a cop out not because the current strategy (need-based aid) hasn't yet been shown to be cost effective but because it follows on, and is part of, a potentially dangerous trend whose origins seem to be well-intentioned. This is a trend towards removing social supports and replacing them with the similar (or lesser) supports combined with accountability. Yes, it's true (as Lashawn points out in the comments) that MDRC's program awards new aid attached to performance requirements on top of existing need-based aid (to the extent that existing aid isn't reduced because of aid rules). My fear is that as we've seen in the past, programs like these are too easily misinterpreted--even before results appear. Opening this can of worms makes it so much more likely that the results of a positive evaluation will lead schools, states, and feds to simply attach conditions to the existing aid students get, rather than ADD new aid with conditions. That means aid becomes performance-based funding, not performance based incentive funding, and I'm opposed to that as a mechanism for enhancing the performance of disadvantaged students and schools.

Some other forms of conditional cash transfer provide money that one would otherwise not receive--without taking away existing resources. For example, Oportunidades pays poor moms a stipend if they take their kids to the doctor. I've got no problem with that. Similarly if welfare reform had involved giving the poor more financial support with conditions, instead of adding additional requirements to their existing aid, I would've been for it.

So in sum-- my concern is with the signals sent by these conditional aid programs, and evaluations of them-- which I think, in 5-10 years we'll see resulting in opening a gateway for policymakers to believe they have hard evidence to treat low-income college students as they do welfare recipients, requiring performance in exchange for aid. I do not find fault with MDRC's well-designed evaluation or their goal of building on their past findings (and their own theories of action), nor do I fault the Gates Foundation for funding what appears to many to be a promising program. I highlighted this program to draw attention now to the broader implications of these conditional aid programs, to note how similar programs have been used and misused in the past, and therefore issue a warning that researchers and funders alike need to pay close attention to the assumptions supported by their work.

I realize my original posting wasn't quite this nuanced or that well-articulated, and for that I apologize-- I hope that clarifies my point.