President Obama declared a crisis in the soaring cost of higher education here Thursday and unveiled a broad new plan that aims to make college education more affordable by tying federal financial aid to new college ratings.
The plan, which Obama rolled out as he opened a two-day campaign-style bus tour of college campuses, would create a rating system beginning in 2015 to evaluate colleges on tuition, the percentage of low-income students, graduation rates and debt of graduates.
Eventually, as an incentive for schools to make improvements in these areas, federal financial aid would be awarded based on those ratings. Obama said he could create the ratings system through executive action, but the plan to reallocate federal aid based on the ratings would require congressional approval.
The idea that universities should compete on economic merits isn’t a bad one, of course. Tying that competition to the lust for federal dollars in any way is always where these kinds of things get mucked up. Government rules tend to favor the government first.