Obama puts emphasis on education

President Obama promises to deliver for higher education.

The $787 billion stimulus package signed into law by President Obama last Tuesday and his Federal budget proposal mark a dramatic change for student financial aid. The presidentâÄôs 2010 budget overview, released yesterday, increases the need-based Pell Grant award maximum to $5,550 by the 2010-11 academic year, and tacks the program to grow faster than inflation in the years to come. What more, the President proposes to make Pell Grant funding mandatory in an effort to guard the student aid from political winds; it could become as stable as Social Security and Medicare. The provision is part of a broader move toward âÄúdramatically expanding financial aid while making it simpler, more reliable, and more efficient.âÄù The assistance couldnâÄôt come soon enough for students and families who have struggled to keep pace with skyrocketing tuition over the last couple decades. President Obama also seeks to drastically remodel the student loan-scape by removing subsidies and default protections to private student lenders, supplanting them with direct Federal student loans. Obama called the private lending model âÄúa wasteful systemâÄù while campaigning, and even Kevin Bruns, executive director of AmericaâÄôs Student Loan Providers has admitted a fix is necessary âÄúto get us through this period.âÄù The budget overview allows for billions of dollars to buy up private loans, a double-whammy that expands the governmentâÄôs direct lending capacity while clearing some of the potentially bad loans clogging lendersâÄô balance sheets. Whether the plan makes sense for taxpayers is up for debate, but until banks start lending again the program would come as a relief for students and families who may soon have been forced to deal with a contracting student loan market. Yesterday, Secretary of Education Arne Duncan said the increased funding âÄúrepresents a significant expansion of our federal student aid programs, providing more dollars to allow more students to attend more schools.âÄù What more, Obama seeks to increase the Department of EducationâÄôs discretionary budget by $5.3 billion, or 12.8 percent over the next year. Obama echoed our own President BruininksâÄô call for a renewed investment in human capital. Tuesday night, President Obama called on all Americans âÄúto commit to at least one year or more of higher education or career training.âÄù Refreshingly, President ObamaâÄôs recent spending proposals nearly make the challenge feasible; this professor-turned-president appears truly committed to higher education.