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College Financial-Aid Loophole: Wealthy Parents Transfer Guardianship of Their Teens to Get Aid
Amid an intense national furor over the fairness of college admissions, the Education Department is looking into a tactic that has been used in some suburbs here, in which wealthy parents transfer legal guardianship of their college-bound children to relatives or friends so the teens can claim financial aid, say people familiar with the matter.
The strategy caught the department's attention amid a spate of guardianship transfers here. It means that only the children's earnings were considered in their financial-aid applications, not the family income or savings. That has led to awards of scholarships and access to federal financial aid designed for the poor, these people said.
Several universities in Illinois say they are looking into the practice, which is legal. "Our financial-aid resources are limited and the practice of wealthy parents transferring the guardianship of their children to qualify for need-based financial aid—or so-called opportunity hoarding—takes away resources from middle- and low-income students," said Andrew Borst, director of undergraduate enrollment at the University of Illinois. "This is legal, but we question the ethics."
Also At:
https://www.propublica.org/article/university-of-illinois-financial-aid-fafsa-parents-guardianship-children-students
https://chicago.suntimes.com/2019/7/29/20746376/u-of-i-parents-giving-up-custody-kids-get-need-based-college-financial-aid-university-illinois
(Score: 5, Informative) by AthanasiusKircher on Tuesday July 30 2019, @04:23PM (8 children)
I'm not saying I disagree with all of your points. There is incentive in working for success, etc. I'm NOT in favor a move to socialism in most areas (though the only reasonable -- and civilized and moral -- solution to healthcare in my opinion is to move further in that direction). However...
That I need to call BS on. If there's anything the recent college admissions scandals have taught us, it's that rich people play by different rules in the U.S. They can afford better educations, get into better schools (bribing or cheating their way in if necessary), make better social networks with other rich folks, and generally end up much further ahead in life than the average person.
I say all of this as someone born to blue-collar parents where no one on my family ever attended college before, and I managed to go to some elite schools. Yes, I was lucky enough that my intelligence got me through and allowed me to succeed. I also was lucky enough along the way to have a few friends and mentors who pushed me in the right directions. When I was a sophomore in high school, I started receiving lots of fliers from top colleges interested in recruiting me after my high performance on the PSAT. I hadn't even heard of many of them (seriously -- I was that ignorant), and it was only a friend who had (because he came from higher class parents who went to college and were engineers) that even made me look beyond my local area and think of applying to top schools.
When I was a know-it-all high school kid, I used to say stuff exactly what you do: "Everybody has equal opportunity! if they aren't doing well, let them pull themselves up by their bootstraps! Anyone can do it!" When a teacher once challenged me about the necessity of welfare, I reacted coldly -- "Too bad. No handouts." But as I've grown up and matured and seen the world, I've realize how damn lucky I was to have parents who tried their best to find some opportunities for me, and then friends and acquaintances and mentors who were lucky enough to cross my path -- otherwise I'd never had the path I took.
Instead, I'd be like most kids who don't have a chance at my path of schools and careers, not because they necessarily aren't smart, but because they don't have the resources around them and don't have the luck to be influenced by people who can expand their horizons. Meanwhile, rich kids with mediocre talent at best are funneled into these top schools and have a leg up in their careers. I know them all well. I went to school with them. I've taught them. I know very well all the opportunities they had that I could never have dreamed of as a child.
So, anyone who says "we have equal OPPORTUNITY" is full of crap. Sure, we don't have some sort of horrific caste system like India has historically dealt with, nor do we have aristocratic classes that make social mobility impossible. Social mobility does happen, but let's not pretend that it's easy or common in the U.S. to significantly move out of your class, compared to what would happen if everyone truly began with a "blank slate" and we had true "equal OPPORTUNITY."
(Score: 2, Troll) by The Shire on Tuesday July 30 2019, @05:06PM (5 children)
Totally not BS for a number of reasons. One is simply that Ivy League universities don't actually offer a better education than any other top university that you can get into and in fact they can be far worse. Ultimately it's what you do with your education that matters in terms of opportunity. It's pointless to obsess over the 1 in 5000 kid who managed to cheat the system, your competition is with the other 4,999. You can succeed simply by going to a trade school. You can excel by going to a community college. It's entirely about your level of drive and talent.
Don't confuse "Equal Opportunity" with "Equal Outcome". The first is always out there waiting for you, the second doesn't exist and never should. Opportunity is about improving your lot in life for yourself and your kids. It's not about having everything the next guy has.
(Score: 2, Insightful) by Anonymous Coward on Tuesday July 30 2019, @05:29PM (3 children)
One day you'll learn.
AK's comment did a big *whoosh* over your head because you're still in the younger mindset he described himself growing out of.
(Score: 1) by khallow on Wednesday July 31 2019, @01:10AM (2 children)
While I applaud your and AK's attempts to grow up, uninformed cynicism isn't any better. What rich people can do is not much different from what average people can do. Sure, it's a better start, but only if the person takes advantage of it. What gets missed is two things. First, a better start is only worth so much. Notice how the advantage is always phrased in potentiality. One can have an advantage. But there are also disadvantages to these things, such as missing out on valuable life experiences. Meanwhile ambition, talent, and experience (what is often termed "luck") can take you much further than the luck of being born to rich parents.
Second, I don't want to sound like sour grapes, but a lot of these wealth-related advantages (especially of the kind derived from cheating) aren't desirable to us. For example, maintaining your list of elite, rich friends is great for some things, but I haven't heard a lot of people around here who value that or would want to take up the considerable effort to maintain such connections. And of course, what do you really know, if you cheated to get into a school beyond your intellectual means? Much was said of mentors who would expand one's horizons. Being born rich doesn't give you any better access to that.
(Score: 1, Touché) by Anonymous Coward on Wednesday July 31 2019, @03:53AM
Being born rich is such a terrible burden. We should make sure that doesn't happen to anyone ever again.
(Score: 2) by AthanasiusKircher on Friday August 02 2019, @07:25PM
Thank you for a clear and well-thought-out reply.
Let me just disagree on a few points:
While that is true, many average or poorer people don't even know what is possible. Or, because they have never known anyone who has succeeded in ways outside their community, they can't even imagine the possibilities, let alone have a clue about how to do it. It's true that with the growth of the internet today, it's easier to find information than when I was younger, but even then, you need to know what to search FOR.
That may be true, but that's not at all the point. Elite, rich friends get you other opportunities even if you don't want to be rich or "elite." You have more choices because of them. Someone who goes to an Ivy or other top school and mingles with the rich folk isn't just building up a list of buddies to play polo or squash with. (Aside: I don't play either.) It's people who know other people who know someone who can offer you a job or recommend you to your potential future boss or whatever.
Not to mention the sheer power of a resume with early opportunities on it. I've talked to admissions officers at Ivies (I've worked at them), and I know that if you went to one of the top private schools in the U.S. (where tuition prior to college can be upwards of $50k/year), chances are your applications will be "set aside" and given more review. I've taught at a couple of those elite private high schools, and I see the opportunities for kids have that very few public schools -- even the really good ones -- can match. And once your history of elite schools gets you into an elite college, you walk out into the workforce and hand someone your resume, and it says X Top-20 school or whatever. Again, your resume gets a second look. Maybe 5 or 10 years out from your degree, it doesn't matter as much, but it gets your foot in the door and gets you several more rungs up the ladder at the start. If you ever want to pursue a career change and need to convince someone to look at your resume again when you don't really have the expected qualifications, it doesn't help to have those colleges either (as I myself can attest to).
Lots of opportunities and doors open to such folk. Yes, you need to take advantage of them, but it's a lot easier to do so than to work your way up from nothing.
The heck it doesn't. My high school guidance counselor was a joke. The high school guidance counselors at the private schools I've worked with are fountains of resources on how to get a better edge in getting into elite schools. And most of my public school teachers were good folk who cared about their job as educators, but I rarely received the kind of attention I have seen fawned on kids who attend elite private schools. I've taught in a public high school in a reasonably poor community (lower middle class, I suppose). I've seen the difference of the kinds of teachers first-hand. I see the resources such teachers have to offer. I see the amount of time they can devote to kids -- when I taught in such a school I had to teach ~150 students per year. In an elite private school, the number is often ~50 or less at the high school level. You can devote a lot more energy and attention to individual students... in essence, you can mentor them.
And then you move on to college. You don't think a letter of recommendation from a top scientist in your field from a top research university will receive more attention than a random prof at a community college? You have better chances at getting a good position in the workforce or going on to grad school or professional school if you want. And it's easier to stay among those top schools for masters or doctorates if you're already at one.
I admittedly don't know much about your background, but I've seen my life change when I made a leap to the world of the "elite." And since then I've gone back and forth several times between those worlds in some ways in the kinds of positions I've had. So I've seen the poor student struggling to barely stay afloat as he works his way through a state school, while a rich kid coasts through an Ivy.
Again, I'm not saying social mobility is impossible or that people can't make use of resources to get ahead. And I'm not cynical about this either -- I'm realistic about the fact that rich people DO have more opportunities, more ways to find out about more opportunities, more ways to take advantage of those opportunities, etc. That's simply reality. It doesn't mean you can't be poor and pull yourself up by your bootstraps -- but it will usually take more than determination to do so. A lot of luck and a lot of people offering you opportunities you likely wouldn't find yourself helps.
(Score: 5, Informative) by Gaaark on Tuesday July 30 2019, @07:22PM
Yet a rich kid gets to make connections and do unpaid internships while the poor kid has to work two jobs just to STAY in school. Forget the 'old boys club's connections which are USUALLY the BEST way of getting ahead.
--- Please remind me if I haven't been civil to you: I'm channeling MDC. ---Gaaark 2.0 ---
(Score: 1, Insightful) by Anonymous Coward on Tuesday July 30 2019, @07:00PM (1 child)
Agreed. An apple does not fall far from a tree.
For better or for worse, your opportunity is a combination of
1. what your parents set up for you (psychologically, financially, and/or intellectually)
2. what you expect of yourself
And #2 is often just based on #1. People often talk about about opportunities or "what they deserve", but your life generally just goes along the lines of what you expect it to be. Most of us are slaves of our circumstance and fool ourselves to think we have free will.
(Score: 0) by Anonymous Coward on Wednesday July 31 2019, @10:16PM
1. I hated my parents and refused to take money from them. They make me wanna puke.
2. Coming up I heard so many times that I was a fucking moron who needed to clean the floor that I believed it. The only clue I had was encountering dumbfucks with success and comparing their past to my own.
I'm now more ok than ever to pay a lot more in taxes if it means that someone can tell their boss to shove it cause they're going to college.