Policy Reform Ideas That Would Benefit Young Americans

The Center for American Progress’ American Worker Project released a list today of “Sweet Sixteen” suggestions for building a stronger middle class—and a number of them would directly benefit young Americans.

As the author Karla Walter notes, President Obama and his administration are “zeroing in on a strong middle class as integral to the vitality of the American economy as a whole.” Just days before the State of the Union address, which the president will deliver next Tuesday, the article highlights policy suggestions that should “become part of the national debate.” While some directly address young Americans’ vitality and employment, others would certainly aid young Americans in various other ways.

We’ve highlighted some of the reforms that would most benefit and impact young Americans below; view the full list from our parent organization here.

 1. Get young people into jobs so they can be working Americans

Young adults across our nation are among the hardest hit by unemployment, and the inability of these young adults to find jobs is likely to have long-term effects on their economic prospects.

We can address this challenge by putting these young people in full-time national service positions in AmeriCorps, VISTA, YouthBuild, and the youth service and conservation corps that would fill gaps in the services that communities need, prepare young people for future employment, and provide them education awards to pay for college or graduate school.

Fully funding the existing Serve America Act would create 88,000 new youth jobs and enable the more than 15,000 schools and nonprofit groups to engage 170,000 new national service participants in fiscal year 2013.

While pushing national service is not a new idea, making it part of a targeted workforce development and job creation strategy is.

5. Reward students who work their way through college with increased access to federal student aid

Federal work-study aid should be expanded through stand-alone legislation to help working students afford college. Benefits ($3,000 to $5,000) could be targeted to Pell Grant recipients by matching the aid to the size of their Pell Grant award.

The work-study aid would be available during a student’s second year of study and be stacked on top of their second-year Pell Grant award. Providing this assistance in a student’s second year could serve as a strong incentive to complete a full load of credits in their first year. Studies show that one year of college credit often serves as a “tipping point” for substantially higher earnings in the future. Additional work-study aid would also reduce the record level of student loan debt that is currently burdening college students.

6. Save tuition costs for students by awarding them college credit for proven knowledge

As the cost of college tuition climbs, families are increasingly looking for ways to work toward a college degree without breaking the bank. One innovative approach is to facilitate students taking advantage of free college-level learning. These days there's plenty of open courseware available for free on the Internet including from prestigious institutions such as MIT and Carnegie Mellon. Through these sources and many others, students on a budget can access college-level learning easily.

But getting credit for what they've learned is another matter. To count this independent learning toward a degree—or to demonstrate the learning to an employer—students must earn college credit. Some universities allow students to pursue credit for prior learning through an exam or evaluation called a "prior learning assessment." The problem is, though the learning is free, the assessments are expensive.

We propose that the federal government make these tests available for free for introductory college courses. The government should also require that colleges that receive federal financial aid funds accept credits earned in this manner. Through open courseware and free prior learning assessment, a student would be able to pursue up to a year of college education for free in a flexible, self-paced format.

7. Automatically connect student loan repayments to post-college pay levels for new college graduates

The payoff of a college education varies, and the rewards of a degree tend to be small in the years that immediately follow graduation. Student loan payments are the same throughout the repayment period regardless of whether a graduate is making $20,000 or $200,000. The student loan repayment system, which ignores the fact that income varies over time, isn’t working. The number of students who default on their loans each year is on the rise, and it doesn’t even begin to account for the individuals who become delinquent on their loans or put aside necessities in order to make their payments.

The Department of Education currently offers a better option for paying down loans: the Income-Based Repayment system. IBR is a pay-as-you-earn program in which students pay a percentage of their discretionary income toward their loans. The program gives students an opportunity to pay their loans back at a rate commensurate with their ability to pay.

IBR is currently an opt-in program, and very few students choose it. The Obama administration should make income-based repayment the default option for all borrowers.

Brian Stewart is the journalism and online communications manager at Campus Progress.

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