Biden, in a swing state, addresses student anxiety over college costs (+video)
Vice President Biden sought Friday to remind Pennsylvania high-schoolers of the value of higher eduction – and how the Obama administration is trying to control college costs. The state's Class of 2010 owes an average of $28,599 per graduate – the fifth highest debt level in the US.
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Biden has given similar talks in Ohio and Florida recently, part of the Obama administration’s efforts to address growing anxiety about the price of college and to highlight steps it has taken to boost federal grants and make loans easier to pay off.Skip to next paragraph
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With growth in tuition costs far outpacing income and other consumer price increases, surveys show college affordability is a great source of concern for many American families.
Only 22 percent believe most people can afford to pay for college, down from 39 percent in 1985, according to a survey last spring by the Pew Research Center in Washington. Only 5 percent say the higher education system is providing excellent value for the money.
Yet college officials, the Obama administration, and many families still view college as an essential investment in both individuals’ and the nation’s future. Ninety-four percent of parents expect their children to go to college, the Pew survey found.
While Biden and other federal officials can use the bully pulpit to push for solutions to the cost problem, “the biggest problem right now is state budgets and increasing tuition at public universities as a result, and the federal government has very limited influence over that,” says Sandy Baum, a senior fellow at George Washington University School of Education.
Ultimately, the biggest help, she says, would be an improved economy so that families have jobs and so that revenues start flowing again into state coffers.
But she and others give the Obama administration credit for steps it has taken. Among them, according to the US Department of Education:
Reforming student loans. By making all federal loans directly and eliminating subsidies for banks that had been acting as middlemen, the US government will save $60 billion over 10 years, the Obama administration estimates. Its plan is to invest most of that into federal Pell Grants.
Boosting Pell Grants. The maximum grant now for low- to middle-income students is $5,500 a year, up from $4,731 in 2008.
Tax credits. Through the American Opportunity Tax Credit, 9.4 million families in 2011 received as much as $2,500 for tuition, fees, and textbook expenses.
Loan repayment improvements. Graduates who are eligible can cap their monthly repayment bills at 10 to 15 percent of their discretionary income and have the remainder of their loans forgiven after 20 years of payments. Public service workers can have loans forgiven after 10 years.
President Obama, Biden, and Secretary of Education Arne Duncan have also been meeting with college presidents, financial aid professionals, and even college athletics leaders to urge them to do more to cut costs.
“I want to ask you, and the entire higher education community, to look ahead and start thinking more creatively – and with much greater urgency – about how to contain the spiraling costs of college and reduce the burden of student debt on our nation’s students,” Secretary Duncan said at a conference of federal student aid officials in November.