Purdue University President Mitch Daniels joined a conservative-leaning panel Wednesday to address a joint congressional committee about what he sees as the scourge of student loan debt.
Daniels was questioned by members of the Joint Economic Committee, including chairman and Sen. Dan Coats, R-Indiana, about his plan to line up individual investors to pay for Purdue students to go to college, in exchange for a portion of those students' future earnings.
Daniels is pushing for individual benefactors to stake their own money on student success because he thinks too much federal money is being injected into higher education and too much of it is going to students without financial need.
He says he'd like to see a system more like the need-based Perkins loans currently available to borrowers.
"My sense is that a simplified program – federal loan program – coupled with some other vehicles of the kind we've discussed here today, would probably wind up looking more like the Perkins program than the other ones that we have today," Daniels says.
The Purdue University president also continued his push for colleges to demonstrate the value they offer students in the classroom – and not necessarily by building flashy gymnasiums or dining halls.
"The terms of competition are, as they were bound to, shifting," he says. "And I hope they will shift very much in the direction of those schools which are maintaining and can prove academic excellence for the dollars they're charging."
But Daniels received some of the same questions that continue to dog so-called "income share agreements".
Rep. Don Beyer, D-Va., wondered if investors wouldn't also give preference to students who show signs of material wealth, just like Daniels worries federal loans already do.
Joining the former two-term Indiana governor on the panel were representatives from a pair of right-leaning think tanks: The American Enterprise Institute and The Center for American Progress.
