In a contest designed to encourage all high school students to complete the FAFSA (Free Application for Federal Student Aid) the First Lady has promised to be the commencement speaker for the winning school. Students are asked to create videos that explain how their school is encouraging students to complete the FAFSA and also a separate contest for students to share how their school is promoting enrollment in college.
The First Lady says, “Now, too often, young people don’t even bother to apply to college because they don’t think they’ll be able to afford it.” The FAFSA program has around $150 billion to fund education for students who qualify. In the video the First Lady asked for students to all file for the benefits by January 1st of 2015.
When speaking about students from what she called, “underserved communities” a common expression used in place of minority communities, First Lady Obama said, “These students have so much potential, but they don’t always get the encouragement or the support they need to go to college.”
According to the College Board Trends in Student Aid report, “In 2012-13, $238.5 billion in financial aid was distributed to undergraduate and graduate students in the form of grants, federal work study, federal loans, and federal tax credits and deductions. The federal government funded 71% of all student aid and 41% of all grant aid to postsecondary students in 2012-13.”
What these statistics tell us is that students and their families are qualifying for more and more federal aid. According to the Student Aid report, in 1992-93 4.0 million students qualified for federal aid and now in 2012-13 8.8 million students qualified. That is more than double the number of students who now need federal assistance to attend college. Somehow, this is not being viewed as a negative but a positive.
These statistics are staggering given the near requirement of college education for future employment options. In a recent Forbes report it was noted, “A college degree is increasingly valuable, in part because a high school diploma is less and less so.” The report went on to share that college students earned an average of $17,500 more than those with only a high school diploma.
What is even more disappointing is that even if students manage to get a college degree they are presently much more likely to end up working in jobs that are “well below their qualifications”. The report claims that high school graduate only students are doing much worse today than they did just a few years ago. However, the actual truth is that both high school and college graduates are doing much worse today than in previous generations.
While it’s important to highlight the necessity of a college education for expanded earnings opportunity, it is equally important to note that far too many college graduates are earning less and working in jobs where they are overqualified. These signs should point loud and clear to a problem in our economy, but the current administration would have us all believe we are living in better times. Facts belie their deception and the underemployed line is growing even while the unemployment line shrinks from the dropout of discouraged workers and those taking part time work.
Combine this story with the recent announcement from President Obama that, “We don’t want stay at home moms, we want both parents employed” and you can see a dangerous plan taking shape. Mr. Obama outlined his belief that stay at home parents would be better off staying in the workforce and to do that he would like to see the federal government pick up the child care tab.
Taking a quick look at this new Nanny state approach, the Obama’s would like both parents to work and when a child is born to them, both should take maternity or paternity leave. This leave of absence would be funded by the government, of course. Then at 6 weeks of age, the federal government would take charge of the care of your child while you return to your jobs, with the college degree the federal government paid for you to earn.
As an economics teacher, let’s do some simple math using supply and demand. If we have more college graduates in the work force (supply increases) but the need for high skilled or highly educated workers stays the same (demand remains constant) you will find that economic law requires that those workers will be forced to work at a lower wage. Which is exactly what we are seeing and why we will see under Mrs. Obama’s dream, more fast food workers, taxi drivers, waiters/waitresses with a BA/BS degree earning minimum wage.
What is the plan to fix this problem coming out of the administration? Why it is to raise minimum wage so that these college educated underemployed workers can earn more. This will not fix the problem and will only increase the current dilemma workers and Americans are facing, economic decline. Soon, you will not be able to get even a job at McDonalds without a college degree, so those high school graduates will have no employment opportunities and will face a certain future of government assistance. Perhaps Mrs. Obama’s next video will be one that encourages all Americans to apply for food stamps and welfare.