January 2, 2006
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Posted on Mon, Jan. 02, 2006
GOP’s deficit cutting hits students too hard
Mercury News Editorial
Congressional Republicans made a self-satisfied gesture of fiscal constraint before heading home to hornswoggle voters into believing they’re really worried about the federal deficit.
The $40 billion in spending cuts, spread over five years, was barely a pinprick — about a third of 1 percent of the federal budget. This year’s budget deficit alone is $319 billion. The spending cuts will soon be swamped by $56 billion in extended tax cuts that Congress is poised to pass early next year, along with $27 billion in additional tax write-offs for the wealthy that took effect Jan. 1.
In fact, $40 billion in cuts would be barely worth mentioning were it not so irresponsible. Bearing the brunt will be the federal college loan program, which Congress instead should be increasing in light of soaring higher education costs and the fact that American industry is clamoring for a better educated workforce.
Because of the cuts, students will be piling up several thousand dollars of additional debt and parents will be paying higher interest on loans — up to 8.5 percent. Lenders will no longer be able to subsidize new loans from the money they make. And, despite promises to raise Pell Grants — the foundation of federal student aid — by $1,000 to keep up with rising costs, the grants will remain capped at $4,000. (The 650,000 students attending California’s public colleges at least got some good news last week, with the announcement that Gov. Schwarzenegger’s budget will rescind the increase in student fees — $492 for UC schools, $204 for CSU campuses — that were to go into effect next year.)
The $22 billion in cuts and restructuring will be partially offset by $3.75 billion in new grants for students studying foreign languages, math and science, plus $2 billion to forgive loans of special-education teachers and students who enlist in the military after college. But the net $13 billion cut marks the biggest hit in the history of the program.
The House version passed narrowly with no Democratic support. It took Vice President Cheney, rushing back from the Mideast, to break a 50-50 tie vote in the Senate.
Describing the vote as the only chance this year to “actually do something about deficit spending,” Senate Budget Committee chair Judd Gregg of New Hampshire told senators, “This is our responsibility to our children.”
Actually, Congress and the Bush administration have socked it to them. They have piled on a mountain of federal debt with an unbudgeted war in Iraq and a drug program for kids’ grandparents. And now they have compounded this by pinching on college aid. Some high school grads will give up altogether on pursuing a degree, to the detriment of the U.S. economy in the future.
The next generation is paying a big price for Congress’ lip service to austerity.
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