House Appropriations Panel Presses Duncan on Student-Loan Proposal

Education Secretary Arne Duncan defended President Obama’s proposed education budget for the 2011 fiscal year at a hearing held on Thursday by a panel of the U.S. House of Representatives. But a more immediate legislative issue — the Obama administration’s plan to end bank-based student lending — emerged as the focus of the higher-education parts of the discussion.

Compromise legislation that would switch all federal student loans to the direct lending program, ending subsidies to student-loan companies, is moving toward a final vote. The bill, which Secretary Duncan was scheduled to discuss on Thursday afternoon in a press call, would use the billions of dollars of savings from ending the bank-based program to increase Pell Grants for low-income students and finance other higher-education programs.

Thursday’s hearing, before the House Appropriations Subcommittee on Labor, Health and Human Services, and Education, focused on elementary and secondary education. But some lawmakers took the opportunity to press Mr. Duncan on the student-lending plan, raising questions about college costs and government control.

Increasing the amount of the maximum Pell Grant might not end up helping students, said Rep. Todd Tiahrt, a Republican of Kansas. An increased grant might simply lead colleges to increase tuition in turn, he said.

Mr. Duncan said he shared the concern. He said he thought students would stop choosing expensive colleges if they did not provide value for money, citing colleges that are introducing three-year degree programs and other cheaper options as examples.

"I think you’re going to see students and parents go in a different direction," he said.
Mr. Tiahrt, the ranking Republican on the subcommittee, questioned the Obama administration’s student-loan proposal again later in the hearing. "Why is the government taking over student loans?" he asked in a heated exchange with Mr. Duncan. "I think there’s some control issue here."

Mr. Duncan defended the proposal, saying an increase in Pell Grants was necessary. "So many students want to go to college and can’t," he said.

College Preparation and Graduation
Representatives also asked about support for programs intended to help high-school students attend college. Tom Cole, a Republican of Oklahoma, asked why there were no increases in the 2011 budget proposal for TRIO and GEAR UP programs, which help prepare students for college. He criticized the Education Department for focusing too much on new programs.

"Sometimes we do need to do more of the same thing," Mr. Cole said. "We just haven’t done enough."

Both programs will have an opportunity to receive more money through competitive grants, Mr. Duncan said.

On another topic, the panel praised Mr. Duncan for urging action to raise graduation rates for college athletes.. On Wednesday, Mr. Duncan called on the NCAA to ban teams with below 40-percent graduation rates from future men’s basketball tournaments.

"It’s disgraceful to graduate less than one-third of their players," said Rep. James P. Moran, a Democrat of Virginia. "We turn our back on these issues because we enjoy the entertainment of competitive basketball."

Mr. Duncan said that he planned to meet with the NCAA’s president to discuss the issue but emphasized that many institutions did a good job of graduating their players on time, calling those who did not "a few renegades."

"So many universities do the right thing," he said. "This is all about effort. It’s all about culture."


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