President Bush's highly touted proposal to boost federal aid to students has been met with criticism both on and off the Hill due to cuts to other funds the plan would entail.
Specifically, the president's 2008 budget pledges to raise the maximum possible Pell Grant award, thus bolstering a program that has long been a flagship of helping low- and middle-income students pay for college, according to the U.S. Department of Education.
Earlier this month, Bush signed into law a congressional spending bill that raised the maximum grant from $4,050 to $4,310 in time for the next school year. But his 2008 budget proposal calls for a further raise, first to $4,600 and eventually to $5,400.
In a rare convergence with the Republican Oval Office, Senator Edward R. Kennedy (D-Mass.), backed by the Democratic Congress, has been a leading proponent of increasing the grants.
In a Feb. 15 Boston Globe op-ed piece, the senator exhorted lawmakers to "restore the Pell Grant as the foundation of the student aid system."
To accomplish his goal, Bush would draw down subsidies offered to lender companies. Kennedy supports this measure, arguing that the companies have been abusive and kept interest rates too high and that government loan programs are more cost-effective.
He therefore advocates moving money away from lenders and funneling it directly into increases to Pell Grants. But lenders argue students who need low-interest student loans will suffer.
Kevin Bruns, who serves as executive director of the Federal Family Education Loan Program, a Washington-based coalition of 87 lending agencies, said that he supports increases in Pell Grants, but questioned the accompanying cuts in the plan.
"We have no objections to raising the Pell Grant Award. The experts say it's the most effective way to increase access for low-income families," he said to the Daily. "Our objection is the way the president and the Democrats want to pay for the increases. It certainly would harm the low- and middle-income families that use guaranteed student loans."
Bruns said the members of his organization would be affected "pretty dramatically" by the rollback in subsidies, which would represent the third such cut in a year.
He also emphasized that the most dire implications could be for middle-class families who straddle the line for student aid and look to loans rather than Pell Grants to pay for college.
Promoting higher education needs to be a top priority for the government and the current proposal only represents a partial solution, Bruns said.
"We think there needs to be greater federal investment in increasing access [to higher education]," he said. "We're in a global economy right now that is very competitive, and it is imperative that the country produce highly educated young people. We're not going to achieve [this] goal if we're going to do it on the cheap by raiding other financial aid programs."
The increased Pell Grants also come with another cost: reductions in other sources of student aid. The plan would eliminate the Federal Supplemental Educational Opportunity Grant (FSEOG) Program, a complementary loan program for students with Pell Grants.
Opponents to this tradeoff say the proposal simply shifts money from one program to another, rather than increasing overall funding for financial aid.
"The issue is the amount of federal support for need-based financial aid," Pat Reilly, Tufts' director of financial aid, said. "So moving money from one need-based grant program to another doesn't increase the number of dollars to higher education."
Kennedy agreed in his op-ed piece. "[Bush] should abandon this unwise course and help students by bolstering the Pell Grant without hurting them at the same time," he wrote.
