President Obama is right to put more pressure on colleges and universities as well as the states to make a college education more affordable. A nation that keeps telling its children they need more than a high school diploma to succeed in this increasingly high-tech world shouldn’t make it so hard for them to pay for college.
Obama wants to boost the Perkins federal loan program from $1 billion to $8 billion and change the formula for how the money is distributed. Colleges that fail to reduce costs will lose federal aid, an aggressive incentive for the schools to find practical ways to reduce the cost of an education.
The president’s plan also calls for a $1 billion grant competition that would reward states that keep college costs down. Another $55 million would be earmarked to help colleges find ways to increase their productivity.
The plan, which was well received by students at the University of Michigan, where Obama outlined the proposal in a speech last week, would reduce some student-loan interest rates, which have increased in recent years. It would also provide more work-study opportunities for students who need jobs to help them pay their college expenses.
Obama’s approach will go a long way toward helping students from low-income families who value a college education but lack the financial resources to make it a reality. The sticker price of a college education, and the likelihood of being in debt for years, discourages many students from going to college. It is a major reason others never finish.
Under Obama’s plan, colleges will be required to create a “scorecard” that provides information about a school’s cost, its graduation rates, and the likely future earnings of its graduates. That type of practical information can help students make more informed decisions about which college to attend.
Important details, including exacty how Obama expects to pay for the plan when Congress is cutting spending, haven’t been revealed. The proposal drew a tepid response from Republicans opposed to any new spending.
Colleges and universities have also expressed misgivings about some parts of the plan while acknowledging the value of others. Obama put them on notice that raising tuition can’t be the sole answer to meeting their budgets. But with 40 states cutting education funding last year, he knows the schools need more help.
It shouldn’t be so hard for the state legislatures or Congress to understand how much harm they are doing by failing to adequately fund education. They need to keep in mind the price tag for a poorly educated generation.