The scholarships were lost in the controversy over free college and loan forgiveness. Federal grants and loans create a fair playing field while merit scholarships reward excellence in the same field. They both support each other, but are distinct approaches and must be taken on parallel paths. There are very few national scholarships to support excellence. It is time to form public-private partnerships to enhance merit award to achieve national goals.
According to Mark Kantrowitz, a nationally recognized expert in student financial aid, scholarships, and student loans, 1.7 million students receive special scholarships each year. His study shows that most of these scholarships went to students attending four-year colleges. White students received scholarships at higher rates than non-whites (13.8 percent versus 11.2 percent).
Thousands of communities sponsor merit-based scholarships with a large number directed toward low-income students resulting in poor white, black, Hispanic, Asian, and Indigenous students receiving scholarships. In recent years, the standard of merit has adequately expanded beyond grades, standardized tests, and sports, which are known to systematically discriminate against a disproportionate number of underrepresented minority students.
Bakery sales, church fairs, and other traditional forms of scholarship fundraising can no longer keep up with the steep rise in the cost of attending college. Kantrowitz found that 97 percent of scholarship recipients receive $2,500 or less.
National Scholarships offer greater potential for expansion and change. They have the potential to provide billions in aid to national goals such as science, technology, engineering, and mathematics, civic engagement, vocational training, and more.
Many major institutions and companies offer scholarships on the basis of merit. For example, the Gates Foundation funds 5,000 high-performing and low-income students in a program managed by the United Negro College Fund. Coca-Cola is offering $20,000 per scholarship to 150 students. Both are based on need and minimum GPA scores.
In order for these scholarships to have a significant national impact, the government must create partnerships with companies, institutions and research universities. The National Science Foundation currently administers a $100 million STEM scholarship program for low-income students. Why not turn this into a $100 billion, five-year scholarship program funded by public funds and private gifts? Colleges with large endowments may also consider joining these partnerships and contributing scholarships.
It’s time for business people to show their cards. Many people claim that higher education no longer serves the needs of the country. Let’s invite them to a dialogue that leads to large, co-funded scholarships that can move the needle toward both excellence and equity.
However, entrepreneurs will be reticent to join partnerships if colleges are left to raise tuition fees freely. This is why any reform should be part of a comprehensive restructuring of college funding. We will miss a major opportunity for reform if we continue down the path of partial loan forgiveness or free college for some but not for all.
Robert Healdreth is a former economist at the International Monetary Fund whose professional work has involved restructuring South American debt and marketing sovereign debt loans. He founded the Hildreth Institute dedicated to restoring the promise of higher education.