pell grants

Given the imminent threat of an economic crisis, elected officials on Capitol Hill are looking for ways to make drastic cuts in government spending. If everything is on the table that means access to Pell Grants for students who can't afford higher education is also on the table.

The U.S. Public Interest Research Group (US PIRG) has launched a campaign to urge leaders not to cut Pell and has some high power names behind its advocacy program. With tweets throughout the day with the hashtag #SavePell, members called on colleagues and Americans for support in the Pell Grant program.

NancyPelosi
Education is one of the best investments we can make in our nation's future & why we're working to #SavePell goo.gl/8YKf2

edworkforcedems (The democratic leaders of the Ed and Labor Committee)
We're doing all we can to #SavePell from cuts that would hurt our #students & economic competitiveness http://usat.ly/qSPNUL

He also had many many other tweets throughout the day about Pell Grant data and information. (see graphic below)

WhipHoyer Rep. Steny Hoyer
Dems are fighting to #SavePell, investments that will help us out-educate competitors, ensure we can #MakeItInAmerica bit.ly/r4JshZ

Whip Hoyer also asked his twitter followers how the Pell Grant has impacted their lives and then RT'd each of those stories.

SenatorCardin Senator Ben Cardin
Cardin on #SavePell day: Fighting for Pell Grants is not about the next election--it’s about the next generation. http://goo.gl/4hJUv

SenWhitehouse Sheldon Whitehouse
We must work together to #savepell grants. Our budget can't sacrifice the future of our kids or our economy. #pell

The U.S. Department of Education released state-by-state data on the Federal Pell Grant Program for the 2012-13 academic year. The data compares the current $5,550 maximum award to what the Pell program would look like under the GOP budget proposal.

Click to grow the image.

Here's what's going on

• The President is at the University of Maryland today talking to people about the debt deal.
• Summer internships on Wall Street have fewer perks and more quirks.
• Reviews continue to come in for Margaret Hoover's book about how the Republican Party can win over young voters. I still don't think it's true but once I get the book I'll give a better analysis. Other Republican bloggers are saying that the GOP should exploit the growing disenchantment between the President and young voters for their own electoral dysfunction.
• Students and College Presidents have been lobbying The Hill all week to help save Pell Grants. I know there are a lot of orgs out there doing great work around this - but you should call your Members of Congress TODAY and make sure they know how you feel.
• 55% of young voters oppose the tax on online purchases in California coined the Amazon Tax.
• Election Day Registration advocates in Maine are still working hard to build awareness around the People's Veto of the Governor's bill to end the 40 year long practice of EDR.
• Young voters continue to support Social Security but they worry about its possibility for preservation.

  This piece quotes a report that came out Wednesday from the Economic Policy Institute that says that young voters are uninformed around SS and as such will believe whatever they're told unless we better educate them.

  "The Economic Policy Institute seeks to address the skepticism and lack of interest and understanding with this comprehensive guide to Social Security—written by young authors for young people."

• In pop culture news - sexting is all the rage on college campuses... It's also all the rage in Congress.. didn't you see the news? Old people always complain about how young people are always looking down at their phones all the time... well if you were sexting wouldn't you?
• Victoria (in Australia) is using social media in high schools to help combat homophobia.
• Young Americans are apparently choosing the burbs over the cities when it comes to buying houses.
  

  "The 2000 census showing an explosion of 25-34 year-olds living in inner cities was cited by urban planners and demographers as evidence that American youth were reversing their parents' movements and were moving back to the city. But the newer data shows that this trend has now reversed itself: this generation, now ten years older, has moved back to the suburbs to settle down.

  In the last ten years, this group's presence grew 12% in the suburbs and shrunk by 22.7% in "historic core cities," like New York and San Francisco, according to Joel Kotkin at Forbes."

  This probably has more to do with education and children than anything else. Those who were living in the cities when they were 25 ten years ago are at 35 probably starting families and thinking about schools for their kids. Sadly many public schools in urban areas aren't up to par and those who can afford to move and buy houses or live in areas with wealthier schools will jump on it to give their kids better education. That said... 35 year olds are more the tail end of Generation X than Millennials. I think the jury is still out on how Millennials will chose to settle in the housing market.

• And from the HANG ON A MINUTE files - a new study out tries to say that young people find having health insurance to be a turn on in dating. As it turns out this "survey" was paid for by an insurance company. Imagine that. So don't think going out this week and grabbing a plan will get you laid tonight. As it turns out you still have to be attractive and interesting. I know.... sucks huh?
  
• Some interesting charts and graphs from ChartPorn. It's a new study on the history of collegiate grade inflation
  
  

This week I again referenced the hope that the DCCC has to ensure young voters vote for democratic candidates this November. It seems members of Congress want to get reelected, want young voters to vote for them, but members of the US Senate evidently have little interest in casting votes that help young people.

The White House's plan would help students who too often face high interest rates, miserable expectations to repay, and in the end students can end up paying for school three times over. But according to the New York Times bankers say a giant government takeover is afoot

"that could put thousands of people out of work at private lending centers around the country at a time when unemployment is hovering around 10 percent."

So the banks are throwing down. The Times reports that Sallie Mae, the giant student loan lender, has spent $8 million in lobbying the US Senate to prevent the White House's call to overhaul the student loan industry. This is more than double what they spent last year.

"House and Senate aides say that the administration’s plan faces a far tougher fight than it did last fall, when the House passed its version. The fierce attacks from the lending industry, the Massachusetts election that cost the Democrats their filibuster-proof majority in the Senate and the fight over a health care bill have all damaged the chances for the student loan measure . . .

...Political action committees for the lenders and company employees made $2.1 million in political contributions last year, with the money split evenly among Democrat and Republican candidates, the data showed. Sallie Mae’s PAC alone made $194,000 in donations.

Some 10 million students got loans last year to help pay for their educations, and there is disagreement about whether having the federal government take over virtually the entire lending program would help or hurt them. Private lenders warn that students may default on their loans more often because they will get less counseling; the Obama administration says students will benefit from more grants and expanded educational programs. . . "

Less counseling? Seriously? This is their concern? The banking industry just worries about young people, and really wants to make sure they're being taken care of. Yeah, right...

"I would think that the White House would prefer not to make senators vote for something that is going to be very unpopular in their states — and for good reason,” said Jamie Gorelick, a former Clinton administration official who is now lobbying for the lending industry."

Somehow, I think having Senators going back to their districts and explaining to their constituents that they chose their state's young people and their future over the multi-billion dollar student loan industry is more of a win for them. But it wouldn't surprise me if this were to pass Sallie Mae then turned around to spend millions on ads saying they voted against the banker's jobs. Gotta love the Washington BS game.

Email your Senators today and demand they vote in the interest of our nation's youth and not the bankers.

Interestingly enough this story appears the same day The Hill posts a piece reporting that funding for higher education is really good for job creation.

It says, among other things that community colleges specifically can help train youth in some of the most sought after fields such as health care and credentials in engineering which can yield good starting salaries and great futures.

A new report, "Graduated Success: Sustainable Economic Opportunity Through One- and Two-Year Credentials" says

"forty-three percent of those who hold a certificate as their highest degree earn a median annual salary that is higher than that earned by someone holding an associates degree. And twenty-seven percent of those holding a community college certificate as their highest degree earn a median annual salary that is higher than someone holding a bachelors degree. Nearly a third (31 percent) of associates degree holders earn more than someone holding a bachelors degree. . .

. . .The salaries earned by those with community college certificates in engineering and health care ($47,000 and $46,000 respectively), are close to what bachelors degree holders in the social or natural sciences earn, and are actually more than what someone holding a bachelors degree in education earns."

So while the banking industry would have voters believe supporting youth is a crushing blow to the job industry, in reality we're helping more students than NOT helping them.

President Obama's plan of increasing access to college takes another step forward today as the House passed Student Aid and Fiscal Responsibility Act (SAFRA) on strong bipartisan vote of 253 - 171. Chairman Miller, a strong advocate for young Americans, introduced this bill in committee.

While the bill provides more funding for Pell grants and community colleges, a total of $87 billion over 10 years, it does so without increased spending. Rich Williams, Higher Education Associate for the US PIRG, explains that SAFRA is tied closely with the ongoing transition of the Federal Family Education Loan (FFEL) program to the Direct Lending (DL) program. "Many of the largest universities have already made the switch to DL," says Williams. "SAFRA is paid for in full by ending wasteful subsidies to banks and lenders – but while the Department of Education intends to phase out the FFEL program in the near future, without action on SAFRA this year the budget savings will be lost to students forever."

According to a statement released by National Direct Student Loan Coalition:

Presently, over 1,700 institutions are successfully participating in Direct Lending, a program with an enviable track record for the past 15 years. The Department of Education has demonstrated its ability to administer the Federal Direct Loan program, to assist schools transitioning and to prepare for the move to 100% direct lending.

Direct Loan schools report, and national statistics confirm, that the U.S. Department of Education providessuperior service to students, families, and schools, and their “Late Stage Delinquency” default prevention program has resulted in a decrease in their cohort default rates. In fact, the cohort default rate in Direct Lending remains significantly lower than in FFELP.

Pedro de la Torre III, Campus Progress Senior Advocacy Associate, was also upbeat about the bill's passage but noted that "language attacking ACORN was included in the bill at the last minute. We think this is unfortunate because it has nothing to do with student aid, and because ACORN does some very good and important work. Hopefully this language will be removed before this legislation is passed through Congress."

On the prospects of the bill in the Senate, de la Torre is positive but warns that "lenders are working hard to either stop or water down the bill. If young people continue to take action in support of college affordability, we expect a strong bill to pass. The key votes will be from conservative democrats, especially those from states with strong state-affiliated lenders or guarantee agencies." Williams agrees, noting CT, CO, MO, MT, ND, NM, NY, OH, PA, VT as particularly key states. Williams suggests that passage in the Senate could be trickier because, Senators, when compared to Representatives, have longer and deeper relationships with the lending community. Moreover, the climate on The Hill is engulfed with health care debate. Still, interested parties are weighing in on this bill's future.

The voice from the right concerning this bill has been about jobs and the government takeover of the student loan industry. Writing today in response to SAFRA's passage in the House, Rep. Michelle Bachmann argued:

Ending private sector competition in the student loan industry and making the Direct Loan program the sole provider will kill jobs, and greatly expand the control of the federal government. The Federal Family Education Loans (FFEL) program has been the overwhelming choice for student and parents for the past 40 years. In fact, 78% of all new federal student loans from 2007-2008 were administered through this program. Yet, the government wants to end it. It doesn't make any sense.

Williams tells me that the default rates for FFEL is higher than for DL. Through FFEL, lenders are able to secure very low interest rates and at almost no risks. As Williams tells me, "Student loans don't qualify for bankruptcy, so it is the taxpayers who must repay the lender when a student defaults on a loan." The problem with this is that lenders have no skin in the game, allowing them make loans to riskier borrowers. So, to Bachmann's point, it isn't about whether or not someone uses the program, but how well the program operates. And to claims of a government takeover, let's let her Republican colleague, Rep. Thomas Petri, who has been a champion on this issue for over a decade, do the explaining:

Despite what you have been hearing from those in the lending community, the fact is that currently we have two federal student loan programs that provide the exact same student loans to borrowers, and schools choose to participate in either one or the other. FFEL is a federal program -- private lenders make the loans with two separate subsidies from the federal government: a guaranteed interest rate and a guarantee against default losses.

The Direct Loan Program uses the proceeds from the wholesale auction of Treasury securities to the private sector to fund loans to students, and all servicing and bill collection is handled by private companies operating through performance-based contracts. The loans are delivered to students through the same system that universities use to disburse Pell Grants.

Over the years the FFEL program has proven to be fraught with scandal, an unreliable source of funds, and it costs billions of dollars more for taxpayers. By originating all new loans under the Direct Loan Program, we are not favoring government over the private markets. Rather, we are eliminating the federal guaranteed program which for years has been a gravy train for lenders and guaranty agencies, and moving in favor of the Direct Loan Program which is structured in the interests of students and taxpayers.

...in the interest of students and taxpayers. I like that.

In a time where advanced education is critical to the United States' standing in the global economy, students are finding that getting that education is becoming far more difficult, especially students who do not come from wealthy backgrounds.

Most Americans believe that access to higher education should be based on ability and merit, yet in the wake of university budget shortfalls some schools are creating a pay-to-play policy with their admissions.

Facing fallen endowments and needier students, many colleges are looking more favorably on wealthier applicants as they make their admissions decisions this year.

Once again, our higher education system is contributing to the socioeconomic status quo.

“There’s going to be a cascading of talented lower-income kids down the social hierarchy of American higher education, and some cascading up of affluent kids,” said Morton Owen Schapiro, the president of Williams College and an economist who studies higher education.

(...)
This year, many of these colleges say they are more inclined to accept students who do not apply for aid, or whom they judge to be less needy based on other factors, like zip code or parents’ background.

Many of these schools are opting to admit a higher percentage of wealthy foreign students than in the past, since they are not eligible for public scholarships and pay the highest tuition rates. This means that fewer admission spots will be available to American students, further contributing to the United States' comparative education decline.

The economy has also severely affected admittance into Ph.D. programs, leaving the United States in danger of losing even more ground in the information economy.

Several colleges have recently announced that, regardless of application quality, they plan to admit fewer Ph.D. students for this coming fall than were admitted a year ago. The economics of doctoral education are different enough from those of other programs that some universities' doctoral classes will be taking a significant hit, with potential ramifications down the road for the academic job market, the availability of teaching assistants, and the education of new professors.

The reduction of Ph.D. students admitted into programs will have negative consequences down the road when we look to a new generation of academics and researchers to make the innovations and form the ideas that will lead the country forward.

Charles B. Reed and F. King Alexander have a proposal in Inside Higher Ed calling for a “new kind of institutional aid” that would support colleges and universities that admit lower-income students.

To attempt to change this ominous direction to focus on the new generation of students with the greatest educational needs, it is imperative that we revisit the “cost of education allowances” program and develop a federal Title I type program for higher education institutions. This policy would provide a specific flat “capitation” institutional grant per lower-income student to every college and university that meets a minimal enrollment threshold of 20 percent.

Reed and Alexander argue that the current “individualistic and market-oriented approach to funding higher education by simply putting resources in the hands of students” has resulted in “perverse fiscal and institutional incentives,” despite being worthwhile. They believe that their proposal could reduce the challenges facing universities and low-income students that have led to the return of pay-to-play admissions mentioned earlier.

Part of the problem is that many short-sighted Republican state legislatures have been attempting to balance their state budgets on the backs of students, leaving universities no choice but to raise tuition rates and cater to the wealthiest applicants.

The United States needs a strategic plan; one that focuses on long-term investment in infrastructure, research, and human capital. We need more ideas on how to improve and progress like those posed by Reed and Alexander, and most important, we need the courage and values to implement them.

The GIVE Act (The Generations Invigorating Volunteerism and Education Act) focuses on reigniting the American landscape by leveraging the energy, passion and talents of citizens in order to give back to their communities. What makes the GIVE Act really important is that it calls on all generations to serve. This means that older Americans can share their experiences and insights with younger folks, who in turn can teach about technology and its practical uses, among other things.

All in all, the GIVE Act is comprehensive and inclusive. The Act includes opportunities for "green" volunteerism and under-served youth, as well as for high school, middle school and college students. Service-learning is another component that strengthens this bill, because helps citizens understand and refine their impact.

According to a release from Rep. George Miller's office, the legislation comes as nearly 65,000 college students prepare to volunteer and serve on alternative Spring Breaks this year – up 11 percent over last year. Young Americans are serving in record numbers – and facing a difficult job market in today’s economy. Of the 1.2 million jobs lost last year, 60 percent were held by workers under the age of 25.

Highlights from the bill are below. The GIVE Act will be on the House floor tomorrow. You can track the bill from here and contact your Elected Officials from here and here. Act now so that tomorrow we can get to work.

Creates 175,000 New Service Opportunities and Rewards Americans for Commitment

• Grows the number of volunteers nationwide to 250,000, up from 75,000. The bill also links the full-time education award to the maximum authorized Pell Grant award amount in order to keep up with rising college costs.

Provides Incentives for Middle and High School Students to Engage in Service

• Establishes the Summer of Service program that engages middle and high school students in volunteer activities in their communities and allows them to earn a $500 education award to be used for college costs.

Makes High School Students Part of Solution to Challenges in their Communities

• Establishes Youth Engagement Zones, a new service-learning program to help bridge partnerships between community based organizations and schools in high-need, low-income communities to engage high school students and out-of-school youth in service-learning to address specific challenges their communities face.

Recognizes and Supports Colleges and Universities Engaged in Service

• Establishes the Campuses of Service to support and recognize institutions of higher education with exemplary service-learning programs and assists students in the pursuit of public service careers.

Boosts Opportunities for Disadvantaged Youth

• Expands opportunities for disadvantaged youth, including those with disabilities, to become more involved with service and strives to include people of all ages and those from diverse background in volunteerism.

Creates Green and Other New Service Corps to Meet Key Needs in Low-Income Communities

• Establishes four new service corps to address key needs in low income communities, including a Clean Energy Corps to encourage energy efficiency and conservation measures, an Education Corps to help increase student engagement, achievement and graduation, a Healthy Futures Corps to improve health care access, and a Veterans Service Corps to enhance services for veterans.

Broadens Scope of Collaborative Service Efforts

• Expands the focus of the National Civilian Community Corps (NCCC) to include disaster relief, infrastructure improvement, environmental and energy conservation, and urban and rural development.

• Encourages service partnerships with other federal agencies.

Recruits Scientists and Engineers to Service to Keep America Competitive

• Recruits scientists, technicians, mathematicians and engineers into national service to help keep America competitive.

Expands Service Opportunities for Older Americans and Public-Private Partnerships

Creates two new fellowships to engage social entrepreneurs, boomers and retirees, the private sector and Americans from all generations in service.

• ServeAmerica Fellowships: ServeAmerica Fellows are individuals who propose their own plans for serving in their communities to address national needs and are matched up with a service sponsor.
• Silver Scholarships and Encore Fellowships: These programs offer boomers and seniors, age 55 or older, opportunities to transition into service post-career as well as entrance into new careers in the public or nonprofit sector.

Creates a nationwide community-based infrastructure to leverage investments in service

Builds a nationwide service infrastructure through community-building investments and social entrepreneurship.

• Community Solutions Fund: Creates a Community Solutions Fund pilot program that awards competitive matching grants to social entrepreneur venture funds in order to provide community organizations with the resources to replicate or expand proven solutions to community challenges.

Establishes Call to Service Campaigns

• Includes a Call to Service Campaign to launch a national campaign encouraging all Americans to engage in service and to observe September 11th as a National Day of Service and Remembrance.

When I think of the way that campaigns and politicians reached out to young voters this year, I have to say that the GOP doesn't come to mind as the model group of youth friendly politicos.  

Republicans also haven't been the most friendly when it comes to supporting policies that impact young people.  In 2007 when the House worked to take millions from subsidies that went to providers of student loans and instead gave them as a supplement to increase Pell Grants,  the President threatened to veto it.  

In 2005 when there was a push to increase funding to Pell Grants in a stimulus package and Sen. Arlen Spector (R-PA) said he

"opposes the proposed increase in funding for Pell Grants for College students because it would do little to spur short term economic growth." CollegeConfidential says.

There were 149 no votes in the House on the College Cost Reduction Act of 2007.  Minority Leader John Boehner said he opposed the bill because

"While Democrats insist on burdening taxpayers with new spending and higher taxes, House Republicans have presented plans to balance the budget without raising taxes, keep federal spending in check, and let middle-class families keep more of their own money."

"Plans to balance the budget" is the funny part of that... well... the whole thing is kinda a joke.

Finally, President Bush and many Republican members (along with Democrats) pushed for an $800 billion bailout to financial institutions before the election in November to stop the hemorrhage caused by, among other things, some pretty irresponsible lending practices.

The current stimulus package gives money not to the banks but directly to the people and again gives more money to Pell Grants not to mention money for better equipment in schools, and expanding broadband across the country so rural America can finally have better access to information.  

Yet John McCain, in a sudden decision to begin advocating for young people, has described this as "generational theft."

So giving money to the banks is ok - but giving money to people is theft?  

McCain claims

"We are robbing future generations of Americans of their hard-earned dollars because we are laying on them a debt of incredible proportions."

What was his excuse before?  I mean, John McCain quit his Presidential campaign to work on the Banking Bailout .... Where was the fiscal restrain then?  Where was this fiscal restraint 8 years ago when Republicans signed a blank check to President Bush for unfunded tax cuts and approved year after year of borrow and spend policies?

Last year during the election I followed US Senate candidate Jim Slattery around on a campus tour he made across Kansas.  Slattery pushed a similar higher education plan to then candidate Obama saying that students needed a $5,000 college tuition tax cut.  Slattery said young people are owed things like this because under Republican rule they have cut taxes while overspending to such an extent that it amounts to "intergenerational robbery."

When Slattery described it - I understood... it made perfect sense.  President Bush and the Republican House and Senate in 2001 inherited a budget surplus that they then turned into the worst deficit in American history.  Because of Republican spending and irresponsible Republican tax cuts our government is so underfunded and services are so scarce that we now face an economic recession unrivaled since the Great Depression.  We have zero global competitiveness, our students remain undereducated compared to our global counterparts, and only now are Republicans saying - we should exorcise restraint when Americans need it most?

The income disparity is the worst that its been in over 100 years and Republicans like John McCain actually want to claim that giving money directly to the people who need it most is theft?  A Bank Bailout was ok... but a People's Bailout is wrong?

To me this just seems like another blaring examples of how Republicans claim to love America but clearly can't stand supporting Americans.  Rather than work in a bi-partisan way and be grown-ups about the whole thing, as Paul Begala says its more "Republican strategy of deny, delay, and do nothing."

Luckily young voters don't buy it.  National polls overwhelmingly support for the President's stimulus package with and without changes, and many state reports even in red-state-America like Utah have young voters behind the package and supporting the President.   

This leaves me to wonder if the GOP is only pretending to use the concept of future generations because its politically expedient for them to do so, or if there is a real genuine need to reach out to youth and they're just bungling it so miserably.  Either way, this stimulus goes to people who need it - not corporations or the wealthy 2%... this is the change we voted for.

In light of yesterday's post about Pell Grants in the stimulus, it's worth asking and exploring in more detail whether, and if so how, Pell Grants and other forms of education assistance function as a form of stimulus.

The House Education and Labor Committee has taken up this challenge, and in an email today provided these examples as to why education aid counts as long and short term stimulus. It's worth reprinting the whole thing for general distribution, and I've obtained permission to do so:

The American Recovery and Reinvestment Act passed by the House last week will increase the Pell Grant scholarship by $500 next school year for seven million eligible students (an investment of $15.6 billion). Some critics of this provision are questioning its inclusion, arguing that boosting student aid does not yield immediate economic benefits. They have not provided evidence to back up this claim.

In reality, students and families are facing intensifying job losses, declining wages, and a persisting college affordability crisis – a perfect storm that could hurt our economy’s ability to recover and our future prosperity. Making college more affordable and accessible is an investment in human capital that meets both the immediate and long-term economic goals laid out by President Obama, lawmakers and economists. The following memo explains how investing in the Pell Grant scholarship will generate benefits for state and local economies and help build the 21st century workforce we’ll need as the economy recovers.

Providing direct, immediate aid to millions of students

Recent studies show that the Pell Grant scholarship is playing an increasingly important role in expanding college access for low-income students. In FY 2006, almost 75 percent of students receiving the Pell Grant had family incomes below $30,000.

This investment builds on a key priority for the Democratic Congress – making college more affordable and accessible for students who need it most. When combined with other increases enacted during the 110th Congress, the maximum Pell Grant award will have increased by $1,500 – or 37 percent – since January 2007. This was the first meaningful increase in the scholarship in years.

In addition, the American Recovery and Reinvestment Act will invest $6 billion to create jobs by modernizing colleges and universities, will create a new $2,500 tuition tax credit for students and families, invest in campus-based aid to create new on-campus jobs for students, and will help states stave off further layoffs by restoring cuts to higher education. For more information, click here.

Colleges and Universities are engines of state and local economies

States and communities across the country rely heavily on the income and benefits derived from colleges and universities. College and universities create jobs, support taxes and generate spending on goods and services. Increasing the Pell Grant scholarship will help more students stay in college, and more new students enroll in college – which in turn will help colleges and universities keep more jobs on the payroll and continue to serve as local economic engines. Numerous studies illustrate these benefits.

• For example, colleges and universities in the Atlanta area supply 130,000 jobs and contribute $10.8 billion annually to the state’s economy.
• Each year, the University of Houston system generates over $3 billion in local economic activity and 24,000 local jobs.
• In 2006, Nebraska’s 14 private universities and colleges spent about $521 million on goods and services – generating another $900 million in spillover effects for a total estimated benefit of $1.42 billion to the state’s economy. In addition, Nebraska’s private colleges and universities generated nearly $69 million in state and local taxes and supported nearly 23,000 jobs in the state.
• In 2003-2004, the total estimated economic impact of spending by Pennsylvania’s 14 state-owned regional public universities was $4.47 billion; each of these schools provided an average of 3,592 jobs.

A December report by the Brookings Institute further illustrates the economic benefits of expanding college access: “Expanding eds and meds brings in new income to a metropolitan area. The presence of eds in a metropolitan area makes area residents more likely to earn college degrees and remain in the area to work. In addition, students who come to the area from elsewhere are more likely to remain in the area to work after completing their degrees. In both these ways, expanding eds increases the percentage of a metropolitan area’s residents who have college degrees and, therefore, increases earnings.”

A college degree leads to higher wages, benefits and greater financial security

A college degree is still the best pathway to the middle class for all racial and ethnic groups, men and women. According to a 2007 study by the College Board, college graduates earn 60 percent more over their lifetime than high school graduates; are 70 percent more likely to receive a pension from their employer; and are more likely to have employer-provided health insurance. A college degree yields higher incomes and greater purchasing power, which in turn inject more spending and tax revenue directly into the economy. These are all key ingredients for a sustainable economic recovery.

The advantages of an educated workforce

Leading economists agree that investments in human capital are critical to creating a well-educated, innovative workforce and a meaningful economic recovery.

“Education may not be as tangible as green jobs. But it helps a society leverage every other investment it makes, be it in medicine, transportation or alternative energy. Education -- educating more people and educating them better -- appears to be the best single bet that a society can make.”

--David Leonhardt, economics columnist, The New York Times, February 1, 2009

“It's our human capital that's in short supply. And without adequate public funding, the supply will shrink further. I'm not saying funding is everything, but without it we can't attract talented people into teaching, keep classrooms small and give our kids a well-rounded curriculum, and ensure that every qualified young person can go to college…

[T]he future competitiveness and standard of living of America depend on our peoples' skills, their capacities to communicate and solve problems, and innovate.”

-- Robert Reich, Marketplace Radio , December 3, 2008

For those looking to take action, Rock the Vote is currently running an action on the stimulus package that in part highlights the importance of student aid.

Update: Quick update. I just got off the phone with an activist in Nebraska who provided some clarity on Nelson's statements. It's not just Pell Grants that Nelson is opposed to, nor are they going to make or break his decision on supporting the stimulus. Rather, as a more conservative Democrat from a Red State, he has a more narrow definition than other Democrats as to what constitutes stimulus. Accordingly, he'd rather that items like the Pell Grants be taken out and put into a different piece of legislation.

That's fair enough. I can respect that fact that Nelson may need to take more conservative positions due to the ideological make-up of the Nebraska electorate. And maybe we should cut him some slack for that. The flipside to this, though, is that Nelson has a history of fighting with the youth community on this issue and he shouldn't be slamming Pell Grants in the media. That's not going to build up youth support for Democratic candidates in Nebraska.

FYI, I altered the original title of this post to reflect these updates.
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Think Progress is reporting that Senator Ben Nelson, (D - Neb) may vote against the stimulus if it contains provisions for increasing Pell Grants:

College students sought financial aid in record numbers last year, leading even Bush administration officials to call for an increase in Pell Grant funding — “the most important form of aid to needy students.”

Yet Sen. Ben Nelson (D-NE) is arguing against the House version of the economic recovery package because of its funding for Pell Grants. Nelson says he wants to eliminate “non-stimulative” and non-“job creation” items in the bill:

Even some Democrats are speaking out against including popular programs — such as an almost $15 billion increase in funding for Pell grants for higher education — in legislation that is supposed to spark an economic recovery. “You don’t want to be against Pell grants,” said Sen. Ben. Nelson (D-Neb.). “But the question is: How many people go to work on Pell grants?”

This is not the first time Nelson has been on the wrong side of education policy. In 2007, during the passage of the Higher Education Access Act, Nelson tried to weaken the bill and provide billions in subsidies to corporate lenders like Nelnet. At the time, US PIRG released this statement on an amendment proposed by Nelson to the Higher Education Access Act (link to US PIRG site no longer functions):

The Nelson-Burr Amendment cuts $4.2 billion from need-based aid to low-income students over the next five years and gives the bulk of it to for-profit student lenders.

The Nelson-Burr amendment reduces aid for the neediest students by $290 per year, or nearly $1200 over their 4-year college career.

The amendment lowers the subsidy reduction for-profit lenders from .5 percent to .35 percent and pays for it by cutting $4.2 billion from the Promise Grant program.

The Nelson-Burr amendment takes grants away from low-income students and gives it back to banks including:

• $800 million to Sallie Mae over the next 5 years.
• $160 million to Nelnet over the next 5 years.

The Senate bill reduces less from private student lenders than both the President’s Fiscal Year 2008 budget and the House reconciliation bill. The Nelson-Burr amendment would cut back on subsidies even further, at the expense of the more than five million students who receive Pell Grants every year.

U.S. PIRG urges Senators to vote against the Nelson-Burr Amendment to S. 1762

Today, Nelson is just as wrong in his statements on Pell Grants in the stimulus. Worse, he's parroting Republican talking points on the issue. Just last week, the Chronicle of Higher Education reported that the GOP had fixated on Pell Grants as a key whipping boy in their offensive against the stimulus package:

The entire stimulus package will have much less to offer colleges and students (and beneficiaries of many other social programs) if Congressional Republicans have their way. In speeches and television appearances over the weekend, Sen. John McCain of Arizona and Rep. John Boehner of Ohio, both of whom are prominent members of the minority in their respective chambers, criticized the Democrats’ stimulus packages for greatly emphasizing spending that may or may not spark the economy rather than tax breaks that would put money directly into consumers’ and businesses’ pockets.

Boehner specifically singled out aid for education in his criticism. “[P]roviding $300 billion of this package to states — $166 billion in direct aid to the states, another $140 billion in education funding — this is not going to do anything, anything to stimulate our economy, to help the — our ailing economy,” the Ohio Republican said on NBC’s “Meet the Press.”

As Think Progress accurately points out, and as we reported here on Future Majority last week, these arguments are bunk. Increases to Pell Grants are absolutely a form of stimulus in both the long- and short-term. They will be spent immediately on tuition, books, and in local economies where students live. They will allow young Americans and older ones looking for a leg-up the opportunity to get a better education and increase their employment prospects.

Once again Sen. Nelson is on the wrong side of this issue. I think it's time he hears from some of his younger constituents struggling to attend school and make ends meet in this economy.

Today the American Reinvestment and Recovery Act (aka "the stimulus package") will be introduced in the House. The stimulus is a huge, all-encompassing bill (read full text here) that includes everything from governmental reforms to new energy and health care programs. If you want to get a good understanding of what is in the bill, this four page summary (pdf) is the most digestible synopsis I've read.

As we've written here many times since November, now that the election is over, it is time to move our resources over towards the policy realm. As one of the first major pieces of legislation coming out of the Obama Administration, it's worth taking a look at how well it reflects the concerns of young voters. While not first in any poll of young voters policy beliefs, Higher Education policy is often the issue most associated with young voters, and the issue around which the most information is available at the moment, so I'm going to focus on that particular issue in this post, and provide more details on other issues in a later post.

The Chronicle of Higher Education has an excellent summary posted of the many education provisions in the stimulus package:

• Increasing college affordability for 7 million students by funding the shortfall in Pell Grants and increasing the maximum award level by $500.”
• Providing a new higher education tax cut to nearly 4 million students. The plan will create a new $2,500 American Opportunity Tax Credit that is partially refundable. As a result, the nearly one-fifth of high school seniors who receive no tax credit under the current system will receive a tax cut to make college affordable for the first time.”
• Tripling the number of undergraduate and graduate fellowships in science, to help spur the next generation of home grown scientific innovation.”
• Preventing teacher layoffs and education cuts in every state, maintaining key reforms, and ensuring all schools have advanced technology for the 21st century economy.”

The Pell Grant expansion and the Opportunity Tax Credits are the big story here. Both could provide significant relief to low and middle-income American families trying to pay for college. Here's a more in-depth look at what the tax credit provides (from a House press release):

The Ways and Means Committee is marking up the American Recovery and Reinvestment Tax Act of 2009 today and the tax credit for tuition and textbooks described below will be a part of the Economic Recovery package that will be headed to the House floor.

“For 2009 and 2010, H.R. 598 provides taxpayers with a new American Opportunity Tax Credit of up to $2,500 of the cost of tuition and related expenses paid during the taxable year. The American Opportunity Tax Credit would replace the Hope Tax Credit and the above-the-line tuition tax deduction for the next two years. For the first time, textbooks would be included in the higher education expenses that would be eligible for the tax credit. Forty percent of the tax credit – up to $1000 – would be refundable. This tax credit will be subject to a phase-out for taxpayers with adjusted gross income in excess of $80,000 ($160,000 for married couples filing jointly). This will provide an estimated $13.5 billion in tax relief.”

It's worth stopping here to note that the Opportunity Tax Credit was introduced by Reps Doggett and Perriello, based on legislation they filed earlier in the year (the College Learning Access, Simplicity, and Savings Act (H.R. 386). Some of you may remember that Perriello was a Young Voter PAC endorsed candidate who won a close race in Virginia after a recount. Young voters in Virginia helped elect Perriello, and young Virginians getting ready for college will see the results.

So things are looking good in the House version of the stimulus package. Things aren't quite so rosy in the Senate. This is where we are going to need to direct resources in the next few weeks to ensure that the provisions in the House bill make it to Obama's desk.

Again, the Chronicle of Higher Education provides us with an excellent summary comparing the two bills:

Conservatives in the Senate are already working to cut the Pell Grant expansions out of the stimulus package, arguing that it will do little to stimulate the economy. Ditto the tax credit, which disproportionately assist low-income students. Again from the Chronicle of Higher Education:

The entire stimulus package will have much less to offer colleges and students (and beneficiaries of many other social programs) if Congressional Republicans have their way. In speeches and television appearances over the weekend, Sen. John McCain of Arizona and Rep. John Boehner of Ohio, both of whom are prominent members of the minority in their respective chambers, criticized the Democrats’ stimulus packages for greatly emphasizing spending that may or may not spark the economy rather than tax breaks that would put money directly into consumers’ and businesses’ pockets.

Boehner specifically singled out aid for education in his criticism. “[P]roviding $300 billion of this package to states — $166 billion in direct aid to the states, another $140 billion in education funding — this is not going to do anything, anything to stimulate our economy, to help the — our ailing economy,” the Ohio Republican said on NBC’s “Meet the Press.”

Boehner's argument is bunk. As Rahm Emmanuel repeatedly stated during a Meet the Press appearance, and as Lawrence Sumemrs did on Meet the Press just this past weekend, increased education aid is an investment in the future of the American workforce. A more educated population leads to a stronger middle class. When a family can get aid, and don't need to mortgage their home to send children to college, that strengthens the middle class and the economy. And $13 billion in Pell Grant aid is money that will be spent completely and quickly, helping to financially shore up our universities, many of which are facing funding cuts from the states. It pays teachers and buys equipment which in turn creates other jobs. That's not stimulus?

Some youth groups are currently working to organize around this issue. USSA and USPIRG are already working together to push a robust higher education package in the stimulus bill by organizing college and university governments to come out in favor of the House version. Campus Progress is also running a letter writing campaign Students in states with wavering Republican Senators should call their representatives' offices and urge them to support the Higher Education provisions in the bill.

Of course, even in the best case scenario, these provisions will not solve all the problems in our higher education system. No matter what version of the bill winds up on Obama's desk, more work will need to be done to improve the lending process. Banks are still soaking up taxpayer dollars through inefficient (but profitable) lending practices. The text book companies still maintain a monopoly on campus, price gouging students forced to by expensive "new editions" of old text books. And millions of students will still be unable to afford to go to college, the price for admission into today's middle class.

There's a lot more to be done. Just remember that we are only one week into the new administration, and this is a good beginning for students.