Congressional Republicans have made an aggressive effort this year to slash Pell Grants, and severely restrict eligibility, after the Obama administration boosted the program in 2009 and 2010. At a town-hall meeting in Wisconsin last week, a college student asked House Budget Committee Chairman Paul Ryan (R-Wis.) to explain why he’d hurt “middle- and lower-class people that need it the most.”
The right-wing lawmaker responded:
“…Pell Grants have become unsustainable. It’s all borrowed money…. Look, I worked three jobs to pay off my student loans after college. I didn’t get grants, I got loans, and we need to have a system of viable student loans to be able to do this.
“The second concern I have is, in the health care bill — people don’t know this — for budgetary gimmickry reasons, the administration and Congress at the time, took over the student loan industry. So they had the federal government, the Department of Education, basically confiscate the private student loan industry.”
Let’s unpack this because I think it’s important.
When it comes to the student-loan reform measure that was approved in 2010, Ryan is either deeply ignorant or he’s shamelessly lying. The reform measure didn’t “confiscate the private student loan industry”; that’s idiotic. Under Ryan’s preferred model, before reform, the student-loan industry received taxpayer subsidies to provide a service the government could perform for less. Democrats removed the middleman, streamlined the process, saved taxpayers a lot money, and helped more young people get college degrees. No one “confiscated” anything — the “private student loan industry” still exists — and the officials simply stopped giving money to banks for no reason as part of the federal student-loan system.
If Ryan wants to return to an inefficient and needlessly expensive model, he’s welcome to make the case, but he shouldn’t lie about the existing policy.
The Budget Committee chairman would also have us believe that the Pell Grant system is “unsustainable” because of growing costs, but that’s misleading, too. As ThinkProgress noted, “[T]he GOP’s budget provides huge tax breaks for the wealthy and corporations which dwarf the cost of preserving the grants.” It’s simply a matter of priorities, and for congressional Republicans, sending kids from working-class families to college isn’t high on the list.
And that leads to the larger concern: Ryan’s vision for America’s future is just bleak. Given global competition and the need for the most educated workforce the nation can muster, the leading Republican voice on the budget believes the United States will be stronger and better off if we send fewer working-class kids to college. We should, in his mind, make it much more difficult for these young people to get a degree. Let’s discourage these students, Ryan believes, since the alternative might lead to (cue scary music) public investments and slightly higher taxes on people who can afford to pay them.
Ryan’s comfortable with these families taking on crushing debts, but student-loan debt nationwide is already nearing the $1 trillion mark — even more than Americans owe on credit cards — which very likely undermines the economy as young workers with disposable income inject less money into the economy and more into banks. It’s also getting worse, not better — consumers are paying down their credit cards and home loans, but outstanding student loan debt has doubled in the past five years.
Ryan’s plan, in other words, is a recipe for how the country loses the future.