College Ratings System Can Thrive, Even Without Better Data

Last week, the U.S. Department of Education launched the first of a series of public comment sessions on the president’s proposed system to rate colleges and universities. Held at California State University-Dominguez Hills, students, college professors and administrators, and advocacy groups weighed in. One recurring theme sought to undermine the entire debate: How can we rate schools without data that tell us what we want to know?

It’s true that we lack data. And better data would certainly permit a more nuanced ratings system, one that might be able to tease out differences in value at mid-level or high-performing colleges. But should the same lobbyists who helped ensure passage of a law banning a comprehensive data system now be able to use that same lack of data to keep policymakers and taxpayers from ensuring federal money and student tuition dollars are going to good schools where students can earn valuable degrees? Absolutely not.

Congress is pouring money—over $150 billion a year—into higher education, too much of which goes to colleges that charge students a lot of money for little, or even negative, value. According to the National Center on Education Statistics’ Beginning Postsecondary Students Longitudinal Study, 35 percent of students who began college in the 2003-04 academic year still hadn’t received any degree six years later. Meanwhile, more bachelor’s degree recipients are borrowing to pay for college (66 percent for the 2007-08 class) and borrowing more ($24,700 among those students). More students had high monthly payments for their student loans relative to their incomes. And for the sixth straight year, two-year cohort default rates increased.

Those figures suggest there are likely plenty of schools that aren’t fulfilling their responsibilities to provide students with a worthwhile education and to be good stewards of both student and taxpayer dollars. And that’s why the industry has good reason to want to avoid questions of value: Many of its members won’t pass muster. Regardless, even without better data, it should at least be possible to identify the worst schools – and to warn students before they waste their money. Finding the “worst of the worst” is a good goal, at least for the first years of implementation.

And it’s eminently possible, even without perfect data. Setting a floor on certain college outcomes could compel colleges to shape up, or risk being shut down. The Department of Education already collects the kinds of data it might need for that – access for low-income students, net price for students by family income bracket, graduation rates, transfer rates, and much more. Even given imperfections in some of those data, the Department can establish limits that clarify how bad a school can be before its credibility—and possibly its funding—are called into question.

“Give them the third best to go on with; the second best comes too late, the best never comes.” –Robert Watson-Watt

That’s not to suggest that a good ratings system would be easy to design and implement. But calls from the higher education lobby to let the perfect be the enemy of the good when it comes to rating schools are nothing more than a diversion tactic. Better data would allow for a better ratings system. However, even with the data we have now (as well as the anticipated improvements in IPEDS, the federal data system for colleges and universities), the Department can start to help students and families identify the worst offenders.

A British physicist who designed a radar system for planes flying in World War II, Robert Watson-Watt, once said, “Give them the third best to go on with; the second best comes too late, the best never comes.” Finding the perfect combination of factors for a ratings system may be a fool’s errand, but preventing the waste of taxpayer and student dollars is an obligation.”