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COMMITTEE ON EDUCATION AND
THE WORKFORCE September 17, 2003
Wall Street Journal on Democrat Claims of Pell Grant Cuts:The numbers tell a different story
Dear Colleague:
Americans higher education system is one of our proudest achievements. Each year, millions of students enter campuses across our nation with hopes and dreams, and high aspirations for the future. And each and every year, millions of students are able to achieve their educational goals because of federal financial support. In fact, this year alone the federal government is investing roughly $90 billion in higher education, with about $65 billion of that going directly to students through grants, loans, work study opportunities, and other financial assistance.
ItĄs no wonder then, that when major media outlets began to claim that cuts were being made to the Pell Grant program, Americans started to listen. The problem is, facts have been ignored, the truth has been distorted, and the myth of Pell Grant cuts has been perpetuated.
First, the facts. Pell Grants have not been cut. The formula to calculate federal aid, including Pell Grants, was not changed. What the Department of Education did do was update state tax tables which are one of many variables used to determine how much financial aid a student and family will qualify for. Why did they update these tables? Because they are required to do so by a law passed by a Democrat-controlled Congress in 1992. The Department was previously using data from 1988, and did nothing more than follow the law when they updated tables with the most up to date information from 2000.
The claims of so-called cuts to Pell Grant funding stemmed from this simple update which was nothing more than compliance with the law. As the following editorial, which appeared in yesterdayĄs Wall Street Journal, notes, funding for Pell Grants is actually increasing. In fact, more students than ever are being served, and the House passed appropriations bill for FY2004 includes an additional $885 million for the Pell Grant program, bringing overall funding to $12.3 billion.
However, there is no question that many are concerned about this update, and our multi-billion dollar federal financial aid system. ThatĄs why in July we led a bipartisan group of legislators in introducing the Financial Aid Simplification Act to address the issues with the need analysis formula in a rational and comprehensive manner. This proposal, which is included in H.R. 3039, the Expanding Opportunities in Higher Education Act, will thoroughly examine the formula, and work to find ways to update it so that it provides the most accurate measure of a studentĄs financial need. The solution to this issue is not to prevent the Department of Education from using more up to date data. The solution is to ask why the law required the Department to use these tables in the first place, and seek alternative measures of student need to ensure that the integrity of our multi-billion dollar investment in student assistance is not compromised.
We encourage you to read the following editorial, and take the facts into consideration as you examine this issue. In addition, we encourage you to sign on as a cosponsor to the Expanding Opportunities in Higher Education Act, and help us work to find real solutions that ensure the millions of students and families who depend on our financial aid system are not let down. To cosponsor H.R. 3039, please contact Liz Wheel with the Education & the Workforce Committee at 5-6558 or Elisabeth.Wheel@mail.house.gov.
Sincerely,
John Boehner (R-OH) Howard P. ~BuckE McKeon (R-CA) Chairman Chairman Education & the Workforce Committee 21st Century Competitiveness Subcommittee
Wall Street Journal September 16, 2003
Hey,
Big Spender--II
The issue here isn't an out-of control-bureaucracy. Indeed, the department bureaucracy is fighting for prudence against the Democratic senator from New Jersey (and quite a few others).
Last week, Mr. Corzine pushed an amendment through the Senate that would enshrine in law the use of obsolete data in handing out Pell grants. In the House, there's now mounting pressure to follow the Senate's lead and add the Corzine amendment to an appropriations bill. President Bush, who has yet to use his veto, isn't likely to derail an appropriations bill on account of the Corzine amendment, so it is up to House Republican leaders to resist this move to waste hundreds of millions of dollars in the coming years.
The fight is over the Bush administration's move to update tables used to calculate the state-tax burden in determining financial need. Students in states with higher taxes can have slightly higher incomes and still qualify for Pell grants. The problem is that tables are still using 1988 tax data. Since many states have cut taxes since Ronald Reagan was in office, some people are enjoying an extra subsidy on top of a reduction in taxes.
Sens. Corzine and Ted Kennedy cite a Congressional Research Service report claiming that updating the tables would leave 84,000 students without Pell grants. This, they tell us, is a "cut" exactly when many families are working even harder to meet rising tuition costs.
The numbers tell a different story. More people will get Pell grants in 2004 than in 2003. Since President Bush took office the number of students getting Pell grants each year has risen by a million, and spending has risen by billions--a trend that everyone expects to continue. The only thing that is happening is some higher-income applicants may get no grants or smaller ones, depending on their real after-tax income. It's not even clear how many students would "lose" their grants; the CRS study calculated who would get grants this year using the new numbers versus the old numbers, not how many students received grants last year versus who wouldn't get them under the new rules.
No matter, Mr. Corzine's amendment would require the Education Department to calculate each Pell grant application twice, first with the new numbers and then with the old ones. Officials would have to use whichever were more advantageous for the student.
But it doesn't take a higher education to figure out what's really going on here. Mr. Corzine wants to build a political constituency by refurbishing a program intended to help poor students into a mechanism to broadly redistribute taxpayer money. All the while making the Bush administration out to be callous toward struggling students. And to pull this off, the senator is willing to deny reality by compelling the Education Department to use faulty 15-year-old data. Mr. Corzine, like the president, has an MBA, but he seems to prefer the kind of logic only a Ph.D. could understand. Mr. Miniter is assistant editor of OpinionJournal.com. His column appears Tuesdays.
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