White House Addresses The Cost of College
by Maria Minsker | Cornell University
Last week Vice President Joe Biden addressed one of the main concerns voiced by the Occupy movement: the rise in cost for a college education. Just this past year, student-loan debt surpassed $1 trillion, exceeding credit card debt nationwide. In fact, according to a Huffington Post article, college tuition is increasing at a higher rate than inflation, with many public universities seeing an 8% increase in cost over the last year.
In his speech at a local high school in Neptune, Florida, VP Biden expressed his sympathy for middle class parents and students having to deal with the increases in tuition. “The incredible cost of college education is for the first time crushing hundreds of parents,” Biden said. He also explained that he understands the plight of middle class families having to deal with an expensive college education as he, too, came from a typical middle class family that struggled to pay for college.
While the re-election campaign was not directly addressed, the speech highlighted one of the main focuses of Obama’s 2012 bid for reelection—the preservation of the middle class. Biden said that he and President Obama are determined to help college students and have already made an effort to help them and their families pay for school. According to the White House blog, the Obama administration has created the American Opportunity Tax Credit—an annual tax credit of $2,500 for tuition and other expenses—as well as an increase of over $800 to the maximum amount that could be awarded by the Federal Pell Grant Program.
Largely in response to the various Occupy protests in cities and universities around the country, the Obama administration has also adjusted the student loan repayment options of college students. Future graduates are now able to consolidate their federal student loans in a way that offers lower interest rates. The Obama administration has also pushed for a plan that would lower the cap on student loan payments from 15% to 10% of discretionary income and forgive remaining college debt after only twenty years instead of the current twenty-five year policy. Critics argue, however, that the plan will no doubt make balancing the federal budget deficit, as well as paying down the national debt, more difficult.
Unfortunately for already-indebted college graduates, these recent measures will only apply to current and future students. “We can’t make it retroactive…The contracts have already been sold,” Biden said. Moreover, there is nothing more that the Obama administration can do at the moment given the gridlock in Congress.
In his address, Biden did not discuss the reasons for the massive increases in cost over the past thirty years. According to Sandy Baum, senior fellow in the Graduate School of Education and Human Development at George Washington University, “states are paying less of the cost than they used to,” because their budgets have decreased significantly as a result of the current economic recession. This has resulted in the cost of tuition increasing rapidly at state universities. Furthermore, Baum told National Public Radio that she blames tuition increases on the lack of efficiency in universities as compared to other industries.
Director of the Center for College Affordability and Productivity Richard Vedder believes that the increase in cost should be blamed on the federal government. Vedder argues that the more government aid increases, the more tuition increases. His solution involves establishing limits on grants and loan subsidies. Limits on aid “[will reduce] the demand for college, and that is going to tend to reduce the ability of colleges to raise tuition rates,” he said.
On the Republican front, presidential candidate Rep. Ron Paul has offered a controversial solution to maintaining the cost of tuition. Though he doesn’t suggest altering the current federal student loan programs immediately, he proposes eliminating them in the future when the economy becomes healthy again. “I want to help our students, but I believe we will assist them the most by eventually transitioning student aid away from the inefficient and ineffective federal government and back to local governments and private market-based solutions — which simply work better,” Paul said.
Though tuition rates continue to increase, a college education is highly in demand and as important as ever. “Having a college degree is about a lot more than how much money you make,” Biden said. “It’s about the independence it bestows upon you, the significantly broader range of choices it gives you…it’s about your sense of self-worth…it’s about being able to fulfill your potential.”Maria Minsker is a junior English and communication double major at Cornell University. She is an aspiring journalist who loves to travel, try foreign cuisines and watch reruns of old sitcoms.