The $1.6 Trillion Student Debt Crisis: Shark Tank Style

“Can You Solve America’s Student Debt Crisis?” the Institute of Politics (IOP) and Harris School of Public Policy asked, challenging students from across the University of Chicago to answer the question in a new Shark Tank-style competition that involved bipartisan judges, two former U.S. Senators, a financial reward, and the chance to present solutions to legislators in Congress.

Thirteen teams jumped in, including eventual winners Emily Barnett, Graham Harwood (both MPP Class of ’23), and Robert Callahan, a 2023 University of Chicago MA candidate (Committee on International Relations).  

Student debt is an issue that the friends have frequently discussed, said Barnett, who reached out to Harwood and Callahan after getting an email about the IOP/Harris challenge last fall. 

“I knew that we might not have the same opinions because we all had very different experiences as undergraduates,” she said. “But Graham and Rob have a lot of strong opinions and I knew that this was something that I could speak passionately about. It was a unique opportunity to get to work with your friends on something you care about.”

The policy pitch that the three-member team crafted calls for moving all student loans to a revamped income-based repayment plan that is linked to what a person studies, is capped at 5% of discretionary income, and is interest-free. It also includes a loan forgiveness incentive funded by the federal government and universities. 

They each won $500 and their idea, along with those of the other two finalist teams, is being shared with US senators working on both sides of the aisle to solve the nation’s $1.6 trillion student debt problem.

“What people brought to the challenge was so extraordinary — and better than a lot of stuff that you see come out of the U.S. Congress,” said IOP Speaker Series Director Jennifer Steinhauer, who reported on Congress for The New York Times before joining the IOP last year. “It was hard work and these students have so many competing demands on their time. It was gratifying that we had as many teams as we did, and we hope to continue that trend with future challenges.”

For this challenge, the IOP and Harris invited teams of undergraduate and graduate students to outline, in two pages or less, “a way to make a meaningful difference in college affordability,” including how they’d get their idea paid for and passed by Congress, either with bipartisan support or via the one-party reconciliation process.

IOP Pritzker Fellows Laura Dove, the former U.S. Senate secretary for the majority, and former US Sen. Doug Jones, D-Ala., provided mentoring and answered students’ questions during their office hours. Dove and Trudy Vincent, the university’s associate vice president for federal relations, judged the first round of three-minute pitches during a Nov. 2 dinnertime event at the Keller Center’s Sky Suite, choosing three teams for the final round two days later. 

“We have similar backgrounds in terms of working on the Hill for a long time,” Dove said of Vincent. “But she's a longtime Democrat and I’m a longtime Republican. So, the fact that we both decided we wanted to advance the same group was good.”

On Nov. 4, new IOP Director Heidi Heitkamp, a former U.S. Senator herself, dug in, asking tough questions, providing feedback, and selecting the winner.

“The students were extremely sophisticated thinkers about this topic,” said Dove. “And it was not the reflexive ‘debt bad, universities bad, government should forgive.’ It was much more realistic and creative. How they approached it was really impressive.”

Student debt — affecting more than 43 million Americans, according to the White House — was already on the IOP’s list of hot-button topics to explore when President Joe Biden’s late summer executive order on debt relief pushed it to the forefront. The IOP team set out to plan a debt-relief-centered event that expanded upon its Speakers Series talks and panel discussions, putting student solutions in the spotlight, Steinhauer said.

Rolling it out quickly meant “we were building the airplane as we were flying it,” she added, noting that all the lessons learned will help enable the IOP and Harris to continue to do Shark Tank-style events quarterly.

Despite their heavy class loads, students found ways to carve out time for the competition. “We just treated it like another class for the three or four weeks it was going on,” said Callahan, whose wife, Annie Henderson, MPP Class of 2023, is a classmate of Barnett and Harwood.

Plus, Barnett added, it was exciting to do the work. “We’ve all thought about this topic, and the competition gave us an opportunity to sit down, dig into it, and find a solution that made sense,” she said. Team members, she added, had to research what was out there, including the Purdue University model they used to help shape their proposal.

As the IOP team crafted the competition, Dove said, “we anticipated the students would have a nuanced view of this topic and sure enough they really did.”

That was true of the winning team. Barnett had student loans. Harwood didn’t, but he had a unique perspective thanks to his work as a legislative intern for US Rep. Mike Quigley, AM’85, D-Chicago, which included fielding calls from constituents about Biden’s student loan forgiveness plan. Callahan, a former company commander for the US Army Medical Recruiting Company Chicago, has used military benefits to pay for his studies but came up against the loan issue in his work with the higher-education institutions where he recruited medical professionals.

In its pitch, the team said that “the student debt crisis in the United States threatens the viability of the American Dream” with Harwood noting in a later interview that “student-loan debt is this crippling weight around the necks of the people who want to be making a difference in this country.”

They used Barnett’s example as an undergrad student who took on a lot of debt and then changed careers — from business to nonprofit — as the premise for their proposal. The goal, Barnett said, was to find a way to correct the current moral hazard, where students and the federal government take on most of the debt risk and the universities not so much.

Team members, Harwood added, sought to even that out by putting some of the financial risk on universities, pushing them in the process to really focus on the kinds of educations and opportunities they provide for their students.

The current student loan system works for a lot of people, Callahan said, “but it also fails a large number of people.”

“This is a problem that gets in the way of a lot of people's lives,” he added, “and we thought we had a way we could maybe make it better.”