Page 10
THE BATTALION
MONDAY, APRIL 6. 1981
Features
~ —
Budget cuts to affect middle income students
United Press International
WASHINGTON — Ronald
Reagan’s proposed cuts in aid to
college students are going to be
felt mostly by the traditionally
Democratic middle-income and
working class Americans who
were a key to his winning the
White House.
Reagan is cutting federal aid to
higher education as part of his plan
to trim almost $50 billion next
year. The programs getting axed
are the ones that have made a col
lege education an accepted norm
for most middle-class families and
many in the lower-middle-class.
The president would make it
more difficult for children of mid
dle-income families to get federal
ly subsidized low-interest loans, a
program that has grown out of con
trol because anyone — even the
wealthy — may participate. Many
upper-income families have taken
out the loans and used them for
investments.
Eligibility for grants, which go
m
to lower-income children, would
be tightened also, but nowhere as
much as the loans, the administra
tion says. Also, there will be add
ed emphasis on collecting the
hundreds of millions of dollars in
defaulted payments owned the
government.
Meanwhile, while Congress
decides what to do about Reagan’s
budget proposals, the administra
tion has ordered a halt to proces
sing grant application for next
year.
The budget squeeze essentially
pits the grant program, which
helps mostly low-income stu-
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dents, against the loan program,
which is of more help to the mid
dle class.
Somewhat overlooked in the
battle over the loan and grant
programs is the fate of Social Se
curity payments to full-time stu
dents age 18-22. Even Stafford,
who is one of higher education’s
Capitol Hill patrons, says student
Social Security benefits “probably
will be eliminated.”
Rep. J.J. Pickle, D-Texas, who
chairs the House Social Security
subcommittee that has jurisdic
tion over the matter, says Con
gress won’t eliminate the benefits
outright. But he does seem res
igned to their phase-out.
The administration argues the
benefits are unfair since, in effect,
18-to 22-year-old workers who pay
Social Security taxes are financing
the college costs of people their
own age who are going to school.
Critics of the Reagan plan, like
Sen. Claiborne Pell, D-R.I., say
cutting college aid is “penny-wise
and pound foolish” because in the
1
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ALL FAITHS CHAPEL
The poor will bear
some of the burden of
the higher education
cuts, but the heavy load
will be carried by mid
dle- and lower-middle-
class families who have
come to depend on fed
eral aid for sending
their children to col
lege.
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Michael Miller, UCM Campus Pastor
Presbyterians — UCC — Disciples
"I should've
talked to GTE
rr
long-run the drop they see coming
in the number of students will
mean fewer highly trained people
in the economy.
“Students must not be the sac
rificial lambs of the budget-cutting
process,” says Rep. Peter Peyser,
D-N.Y. “It is not only the poor,
but the middle-income families
and their children who desperate
ly need this continuing help.”
Now, the maximum grant a stu
dent can get from the government
is $1,750 a year, while the average
grant paid to the 2.6 million peo
ple in the program is $929,
although students may not even
get that much this year because of
budget shortages.
Education Secretary Terrel
Bell says those figures will not
change much under the Reagan
cuts for 1982, but he says without
tightening the eligibility the prog
ram would balloon even further.
“We’re belt-tightening; we’re
not emasculating,” he said. “The
cuts won’t be very large. What
they will do is hold down the
growth. If we didn’t do what we
are proposing, the numbers would
be much higher. The government
must gain control of exploding fed
eral spending.”
Students can borrow up to
another $2,500 a year for five
years. Reagan would still allow
that, but require students to prove
they need the money. Additional
changes would require parents to
make increased contributions be
fore students could get federal
money.
Bell claims there will still be an
increase in the number of federal
ly subsidized loans from 2.8 mil
lion this year to 3.1 million in
1982. He said without the changes
the program would have 4.5 mil
lion participants.
“But the size of these loans (be
cause of the changes) won’t be of
the magnitude they have been,”
Bell says.
Additionally, about 800,000
other students age 18-22 receive
an average monthly payment of
$229 from Social Security benefits
because their parents are either
dead, disabled or retired.
Bell says Reagan wants to
“sharpen the focus” of the federal
programs "upon truely needy stu
dents.”
But college administrators, stu
dents, and sympathetic members
of Congress claim the changes will
drive hundreds of thousands of
people from college for lack of
money and may force some small
private schools out of business.
“This will not drive milhons of
students away from higher educa
tion, ” Bell insists, but he concedes
it will change the status quo for
huge numbers of them.
College lobbyists say up to
750,000 students could be forced
to drop out of school. Sixty per
cent of college students depend on
T(
some kind of financial aid, sat
Dallas Martin, executive direct!
of the National Association
Financial Aid Administrators.
But Bell disagrees thatthens
approach will force large number
of students to drop out.
“I think that what it’s going!
drive out is using the federal n
terest subsidies and the f
loan umbrella for borrow;
money for purposes that area!
genuine need,” he says.
The administration also
ises to come up with a tuition b
credit program. Several sud
plans have already been into
duced in Congress, hut non
would give back taxpayers anv
where near what they spend
college costs. Any bill will surel
contain a limit — probably $500
on what a taxpayer could dedu;
from his taxes for higher educafe
costs.
Bell says it has not been dt
cided whether the tax credits nil
be available to parents of pub!
college students, although tic
will definitely be proposed forpi
rents of private college pupils.
The poor will bear some oft!
burden of the higher educate
cuts, but the heavy load will!
Critics of the Reagan
plan, like Sen,
Claiborne Pell, D-Rl,
say cutting college aid
is "penny-wise and
pound foolish ” because
in the long run the drop
they see coming in the
number of students will
mean fewer highh
trained people in the
economy.
On The Double
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carried by middle- and lower-
middle-class families who have
come to depend on federal aid for
sending their children to college
Ironically, it was such voters, dis
gruntled with big government and
angered by inflation that forced
them into higher tax brackets,
who provided Reagan with mucli
of the traditionally Democratk
support he needed to be elected
Reagan would also eliminate
the provision that allows anyoneto
borrow up to $2,500 annually-
whether or not they need it.
Critics of the federal programs
point to the more than $1 billion it
defaulted loans outstanding.
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