Broadening his attack on Republicans’ plans to curb federal spending, President Barack Obama campaigning in Ohio Tuesday portrayed GOP presidential candidate Mitt Romney and his running mate Paul Ryan, the chairman of the House Budget Committee, as intent on “gutting investments in education and science and infrastructure.”
Obama said in his speech at Capital University in Columbus, “Putting a college education within reach for working families just doesn’t seem to be a big priority for my opponent.”
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Judged by his ten-year budget blueprint which unlike Romney’s education proposal has actually been approved by one house of Congress, Ryan isn’t satisfied with the return the federal government is getting on its investment in education.
“While Federal spending on the Department of Education and related education programs has grown significantly over the past few decades, academic achievement has not seen a commensurate improvement,” Ryan said in the report accompanying his budget plan.
Ryan’s ten-year budget blueprint proposes to reduce some federal education outlays as part of its overall 12 percent cut in spending over ten years, for example consolidating and eliminating some of the 82 initiatives on improving the quality of teaching in public schools.
Under Obama, Congress has created a new tax break for higher education, the American Opportunity tax credit, as well as increasing the maximum size of Pell Grants by $900.
One focal point of the campaign debate has been what Ryan would do to Pell Grants, the single largest source of federal aid to low-income students for college education.
For the 2010-2011 academic year Pell Grants provided about $37 billion in aid to nearly 9 million students.
In his budget plan report, Ryan argued that “Pell Grants are the perfect example of promises that cannot be kept. The program is on an unsustainable path” due to legislation since 2007 including the Obama stimulus law that “made Pell Grants more generous than the Federal budget could afford.” He pointed out that the cost of the Pell Grant program has more than doubled since 2008, from $16 billion in 2008 to more than $36 billion in fiscal year 2013.
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While Obama has proposed a maximum Pell Grant award of $5,635 for 2013- 2014, Ryan’s plan proposes a maximum award of $5,550.
Ryan also wants to “ensure aid is targeted to the truly needy” by the changing the formula which the Department of Education uses to determine how much a student and his or her family can be expected to contribute toward the student’s college tuition.
Although some federal support for education is in the form of direct spending, such as Pell Grants, much of it is in the form of tax breaks, such as the Hope education tax credit (worth about $5 billion a year) and the deductibility of charitable contributions to educational institutions, worth about $6.5 billion.
A witness at last month’s Senate Finance Committee hearing on education, James White of Congress’s watchdog agency, the Government Accountability Office, testified there isn’t enough data to know which of the tax breaks is most cost-effective in getting students to finish college or university.
When Sen. John Thune, R- S.D., asked White if Congress were forced to pick only one education tax break, which one should survive, White answered: “Part of the problem here is that we are spending tens of billions of dollars on these programs and we don’t know the answer to the question you are asking.”
Some economists and tax policy experts have questioned whether the tax breaks for higher education aren’t contributing to an inflationary spiral.
Scott Hodge, president of the Tax Foundation testified to the Senate Finance Committee last month that federal subsidies for higher education are “fueling higher college costs by disconnecting student-consumers from the true cost of higher education. In turn, the benefits of these programs get capitalized into tuition costs because universities can boost tuitions without suffering the normal market backlash.”
(Hodge’s group aims for a “neutral” tax code that is designed simply to raise enough revenue for the government to function, without tax breaks for favored groups or industries.)
Obama noted in his speech in Ohio Tuesday that over the past two decades, tuition and fees at American colleges and universities have more than doubled.
“I put colleges and universities on notice: if they can’t stop tuition from going up, the funding they get from taxpayers will go down. We want to give them some incentive to start lowering tuition,” he said.
A question that for now is going mostly un-debated in all the 2012 speech-making is why America isn’t getting better outcomes from its education investments.
According to the Program for International Student Assessment (PISA), which tests students in 37 countries on their math, science and reading skills, average scores for U.S. 15-year old students were at about the average level for the entire group of 37 nations, but were below average in math.
Students in more than a dozen nations, including France, Finland, Australia, Japan, and Korea performed significantly better than American students on the PISA math test. Each of those nations also spends less per student than the United States does – on average about 30 percent less, according to the Organization for Economic Cooperation and Development (OECD).
“When we invest in your future, we’re investing in America’s future,” Obama said to students Tuesday at his Ohio campaign stop. “Businesses are mobile in the 21st century economy – they can locate anywhere – so they’re going to create jobs and they’re going to hire wherever they find the best educated, most highly skilled workers. And I don’t want them to have to look any further than right here in Columbus, right here in Ohio, right here in the United States of America.”
He also said, “The fact is that countries that out-educate us today – they’ll be able to outcompete us tomorrow.” And according to OECD and PISA data, most of those countries are spending less on education and getting more educated students than the United States is.