Clinton touts $350B college affordability plan, faces stiff opposition

Democratic presidential hopeful Hillary Clinton announced a $350 billion plan Monday to make college more affordable, calling for a “new college compact” designed to reduce the growing burden of student debt.

However, the plan faces a difficult sell to both liberal Democrats and Republicans, possibly not going far enough for the Democrats' liberal wing, while turning off Republicans with a high price tag and increased federal intervention.

Clinton announced the plan at a town hall meeting at Exeter High School in New Hampshire, telling gathered supporters: "It’s ambitious but we should be ambitious."

The campaign accompanied the announcement with a campaign video that featured a number of students struggling with student debt telling their stories.

"I want every parent to know his or her child can get a college degree," Clinton said. "That’s the country I want to help build."

The plan aims to ensure that students can attend a 4-year public college without taking out loans, as well as making community college tuition-free, while also pushing states to reinvest in higher education and pushing schools to reduce costs and raise graduation rates.

The plan’s cornerstone is a $200 billion federal incentive system that would encourage states to expand spending in higher education and cut student costs. States that guarantee “no-loan” tuition at four-year public schools and free community college tuition would be eligible for federal money.

Military veterans, lower-income students and those who complete a national service program, like AmeriCorps, would go to school for free, although others would still incur costs for their schooling and living expenses at four-year public universities.

"For many students, it would translate into debt-free tuition," Carmel Martin, executive vice president for policy at the Center for American Progress, who advised Clinton on the plan, told The Associated Press. "It will depend on the student circumstances and the institution they are going to."

Those now repaying loans would be able to refinance their outstanding debt at lower rates, a change the Clinton campaign claims will save an average of $2,000 for 25 million borrowers over the life of a loan. Clinton’s plan would also expand income-based repayment programs and allow every student borrower to enroll in a plan capping their payments at 10 percent of their income and would forgive remaining debt after 20 years.

"We will make sure that debt won’t hold anyone back. For millions of Americans who have debt my plan will give them the chance to refinance at lower interest rates," Clinton said. "If you can refinance your car loan, you should be able to refinance your student loans."

Clinton’s campaign said the plan would be paid for by capping itemized tax deductions for wealthy families at 28 percent.

Although Clinton’s plan may be an effort to satisfy a key demand of the Democrats' liberal wing, the plan doesn’t go as far as others seeking the 2016 nomination. Fellow 2016 hopeful Sen. Bernie Sanders, I-Vt., has called for the elimination of tuition and fees entirely for public universities, funded by taxing hedge funds, investment houses and other Wall Street firms. Many party activists and left-wing politicians have made “debt free college” for all a litmus test for the primaries, with Clinton’s plan falling just short of that test.

Minutes before Clinton’s speech, Sanders tweeted his call for the U.S. to “revolutionize” its higher education system and for free tuition at public colleges and universities.

“There are some really exciting pieces of policy here but also a couple of places where it misses the mark.” Beth Akers, Fellow at the Brookings Institution, told

Akers praised the plan’s push to streamline the patchwork of programs to make income-based repayment a lot simpler, and to make colleges more accountable, but noted the proposal doesn’t go so far as to ensure free higher education.

“It could have gone further in ensuring a free access to higher education,” Akers said. “However, I don’t think it’s critical that we have free education as long as it is affordable and I think this proposal is in line with that mentality.”

Akers also expressed concern about the plan to allow students to refinance their loans, saying that it could benefit those with larger incomes more.

“Those who have a lot of outstanding debt tend also to have very high incomes. Therefore it isn’t a great way of sending benefits to those who really need them, and not necessarily an efficient use of taxpayer money,” Akers said.

Some progressives however, greeted the proposal with enthusiasm. Adam Green, co-founder of the Progressive Change Campaign Committee told The Associated Press that Clinton's plan was a "bold proposal" that was "big and ambitious."

Clinton’s proposal came under immediate fire from Republicans and conservatives, many of whom targeted the tax-and-spend part of the plan.

"By capping itemized deductions -- which already phase out based on income -- Clinton will complicate the tax code and bring back the [Alternative Minimum Tax] for millions of families," said Grover Norquist, president of Americans for Tax Reform.

“[Clinton] has to figure out who to raise taxes on, so this is about making doing business in America even more expensive, raising taxes and then taking all that money and pouring into an outdated higher education system,” Sen. Marco Rubio, R-Fla., said on ‘Fox & Friends’ Monday.

“Students, taxpayers, and voters should react with great skepticism to any proposals that would amount to a Washington takeover of higher education and jeopardize the autonomy and independence that has made our higher education system the best in the world,” a Republican aide told  “These kinds of ideas usually go hand in hand with higher state taxes, increased costs and fewer choices.”

College affordability and student debt have emerged as major issues on the campaign trail as student debt nears $1.3 trillion, while the average price for in state students at public four-year universities is 42 percent higher than it was a decade ago, according to the College Board.

Neal McCluskey, of the libertarian Cato Institute, told that Clinton’s plan may deal with the problem of student debt, but it may come with some ugly side-effects.

“It would deal with the problem of student debt, but it exacerbates a whole bunch of other problems to the point I don’t think it would be a net gain, I actually think it may be a net loss,” McCluskey said, adding that the plan does nothing to deal with the underlying problems of inefficient spending and overspending in higher education.

“You may not see prices rising as much, but you will still see huge amounts of wasted money, as people are encouraged to consume more education, and they’ll do it less efficiently as they aren’t presented with a price,” McCluskey said.

Clinton's plan would likely face a steep climb in Congress, where a $60B initiative by the Obama administration for free community college has received little traction.

The policy roll-out was timed for when students return to college campuses. Clinton organizers plan to promote the plan at registration events and other gatherings kicking-off the school year, a campaign aide told The Associated Press, in an effort to galvanize college students.

The Associated Press contributed to this report.