The Battle Continues
GRAD STUDENT LOANS
THE BELL WILL RING next week for Round Two of Ronald Reagan's bout with American higher education, and the President's men have already revealed what his strategy will be. No fancy footwork here; the word is cut, cut, cut.
When the President submits his 1983 budget proposals on February 8, he will ask Congress to continue the attack on federal tuition support begun last year by tightening eligibility regulations and eliminating altogether federally guaranteed loans for graduate and professional students. The graduate loan cuts alone would affect 650,000 people nation-wide and about 5100 at the University. Chances are Congress will soften the blow somewhat this spring, as it modified Reagan's education reductions for 1982. But as tuition costs rise, anything even approaching the Administration's proposal could force hundreds of thousands of aspiring historians, physicians, lawyers and engineers to abort their plans for the future.
Since 1965, one of the primary ways the government has supported higher education has been to insure and subsidize interest payments on loans students take out to pay for undergraduate and post-college tuition. The cost of the program increased dramatically through the 1970s as interest rates rose, and it jumped significantly when Congress dropped all eligibility restrictions in 1978. Upon taking office, Reagan announced his intention to fight inflation and federal deficits by controlling such "automatic spending" programs, and he ultimately reached a compromise with Congress: family income ceilings were set, service charges were added, and the price tag of the program was reduced from $2.8 to $1.9 billion.
The initial Reagan cuts will admittedly produce a minor improvement. Wealthy families using low-interest loans to fatten stock portfolios or re-furbish yachts will have to look elsewhere for their loopholes. But the new restrictions will also force many middle-class students to use more expensive alternative loan programs, while at the same time not providing additional benefits for the poor. As a result, the Administration's 1982 plan will have a detrimental net effect: the type of school a person attends, or whether he enrolls at all, will depend more than before on how much money he has.
The proposals to be announced next week would only worsen the situation. Students of all economic backgrounds would have to seek higher-interest loans; those who most need federal assistance to overcome long-standing disadvantages would be locked out of the classroom and laboratory. University presidents have already warned the White House that an entire generation of scholars and professionals could be shaped largely on the basis of cold cash rather than intellect or ambition.
The reductions Reagan has already pushed through, as well as the additional ones he plans to propose, illustrate the hypocrisy of the Administration's economic philosophy and threaten the trend toward more accessible higher education. Reagan cuts tuition support in the name of conservatism, but he intends to increase federal spending in areas like defense, while simultaneously reducing taxes. The federal deficit will probably creep even higher than the $100-billion mark sheepishly estimated by the Office of Management and Budget. In short, saving a billion or two by making it harder for students to attend college or graduate school must not qualify Reagan for the role of Courageous Budget Defender. Education loses out because its lobby is less powerful than that of the Pentagon, and in the end, the losers will be young people who want to better themselves and a nation that cannot prosper without their leadership.