By the way, this is sort of typical in the sense that the actual context of that Georgetown discussion was something entirely different. The President was being pressed on the issue of how much debt Georgetown students were taking out, and as part of defending the university, the President was explaining how this common formula worked. I think the intended implication was if a bunch of other colleges were using the same formula, that was verification it was a legit assessment of actual need:
Last year, the Institute for College Access and Success published a study indicating that, as of 2011, 39 percent of Georgetown students graduate with an average of $28,035 in debtâ$1,435 more than the national average. How does the problem of student debt relate to problems of accessibility at Georgetown?
Well, it certainly shows that there are issues to pay attention to, number one. Number two, that was the [2011] number, the [2012] number is less than that. I think the [2011] number reflects the acute circumstances of the financial crisis. The number for [2012] is [$25,500].
We are one of 24 schools that are need-blind full need. ⊠I actually chair that group, called the 568 group. The 568 refers to a passage in Higher Reauthorization Bill about a decade ago. ⊠What it enables us to do is develop a common formula by which we would access the need of the student.
We ask the family to contribute the maximum that they are capable of, according to that formula. We then ask that they borrow, we ask that they apply for work-study, whatever is left over, we pay the difference. ⊠The borrowing that we expect is only [17,500]. ⊠[Students] with their families are making a decision to borrow more.
Now, thatâs worth paying attention to, but by the formula we share with the 24 other schools, we donât believe itâs necessary. ⊠We understand it, weâre aware of it, but itâs not required by our assessment of their family capability.
You donât think that the need formula is flawed in any way?
Well, itâs one that weâve developed in connection with a group of colleges and universities. Weâd also say, though, that given the value that one has with a college degree, I would certainly argue that $25,000 is not a high level of borrowing. I would argue that.
And that is how this kind of evidence often comes out, the company or institution or individual or whatever is defending against something else, not thinking about possible antitrust liability . . . and years later it shows up in an antitrust complaint.
But this is in fact getting to a key issue, which is these formulas allocate certain amounts to loans and work-study rather than grants So even holding aside the issue of whether the rest of the formula makes sense, an agreement on how much in loans or work study would be required would seem to be a handy tool for limiting competition over the generosity of grantsâthe sort of thing that actually comes out of the collegeâs own budget.