Obama Maps 2012 Education Agenda

President Obama on Tuesday outlined an election-year higher education plan that includes a major expansion of college work-study programs, more help for student loan borrowers and a stronger role of community colleges in workforce training.

In his State of the Union Address, the president called for a doubling of slots in the work-study program, through which low-income students earn funds, largely through campus jobs, to help pay for college. The move caught at least one budget expert by surprise.

“It’s a program that hasn’t had an increase in a long time,” said Jason Delisle, director of the Federal Education Budget Project at the New America Foundation. “Many student recipients may not even recognize it as a federal program.”

Delisle told Diverse that the White House decision to expand the program may be linked to the themes of jobs and work, which the president emphasized heavily in his address. The federal government allocates $978 million a year to work-study activities.

The president said his community college plan would help 2 million Americans receive education and training for emerging jobs. In his speech, he cited the work of Central Piedmont Community College in North Carolina, which worked with Siemens Corp. to design technical training programs closely linked to new jobs at a regional gas turbine factory.

“You need to give more community colleges the resources they need to become community career centers,” Obama said, where they could support information technology and emerging manufacturing industries.

The president did not attach dollar figures to the community college proposal, though the administration two years ago helped secure $2 billion for similar initiatives. At a discussion forum after the speech, Education Secretary Arne Duncan said two-year colleges are a logical destination for these business/education partnerships.

The two sectors “should be partners,” he said, noting that some community colleges are open “24 hours a day” to meet the education needs of returning students seeking job-ready skills. “Everyone is stretched for resources,” he said, and these colleges provide cost effective training.

Student groups, among others, said they would welcome the additional spending on two-year institutions, which typically carry lower costs for students. “Funding is being cut left and right, and class sizes are going up,” said Victor Sanchez, president of the United States Student Association. The plan is “one way of investing in the future.”

The president is expected to outline more details of these plans later this week and in his fiscal year 2013 budget proposal in mid-February.

Obama also challenged the House of Representatives and Senate to pass an extension of low 3.4 percent interest rates on government-subsidized loans to undergraduates. Under a law passed in 2007, those rates are scheduled to double to 6.8 percent on July 1.

“At a time when Americans owe more in tuition debt than credit card debt, this Congress needs to stop the interest rates on student loans from doubling in July,” the president said.

In a presidential election year where taxes are a hot-button issue, Congress and the White House face a potential battle over this issue, Delisle said. The main reason is that the lower rate costs “several billion dollars” a year, he noted. “It’s too expensive to pay for over 10 years,” he told Diverse, making a year-by-year extension one potential compromise. 

In addition, the president proposed to make permanent the American Opportunity Tax Credit, through which families can get a tax credit of up to $2,500 a year for college tuition payments. Without congressional action, this credit would terminate at the end of the year along with tax breaks for wealthier Americans that began under former President George W. Bush.

While outlining new or expanded education initiatives, however, Obama also called for greater accountability and cost-cutting by colleges.

“We can’t just keep subsidizing skyrocketing tuition,” he said. “We will put colleges and universities on notice. If you can’t stop tuition from going up, the funding you get from taxpayers will go down.”

While he did not offer many details, a paper circulated by the White House with the speech said the president would propose to “shift some federal aid away from colleges that don’t keep net tuition down and provide good value.”

With more students returning to school and seeking more flexible ways to earn a college degree, Obama said post-secondary education is a national priority. “Higher education can’t be a luxury,” he said. “It is an economic imperative that every family should be able to afford.