Congress may cut education aid

By Mary Ann Albright
Gazette-Times reporter

When Oregon Congressman Peter DeFazio stopped by Oregon State University on Thursday afternoon to argue against proposed legislation that would cut $14.3 billion from student aid programs, he met with a receptive audience.

“This bill affects me and a lot of my friends,” said Jen Gilbreath, a senior majoring in political science.

Gilbreath is the director of federal affairs for the Associated Students of OSU, and she echoes the Fourth District Democrat’s concerns about the impact of Budget Reconciliation legislation currently going through Congress.

“It’s a personal fight, as well as a fight for OSU,” she said.

The House of Representatives recently passed by a margin of two votes a bill intended to reduce spending, cut the deficit and offset Hurricane Katrina-related spending.

The bill includes $14.3 billion in student loan cuts over five years, created through a combination of interest rate and fee increases for students, and reductions in subsidies to lenders.

Gilbreath has federal student loans. She’s similar to the average student, in that she’ll leave OSU after four years with $17,000 in student debt. If this bill passes, the average debt will increase to $23,000.

DeFazio agreed with students who said they felt “targeted” by the bill, and that they were shouldering a disproportionately high burden of the cuts in federal programs.

DeFazio said that dollars spent on higher education are an investment, not an expenditure. He asserted that the state economy benefits from having more college graduates, because they will ostensibly make more money, and therefore pay more taxes.

Making education more accessible and affordable also translates to better social mobility and a brighter future for the community, the state and the country, DeFazio added.

While student financial aid takes a big hit in the House bill, the tax cut package recently passed by the House Ways and Means Committee includes $13.3 billion over five years in a dividend tax cut extension that would primarily benefit people with higher incomes.

“I don’t think it’s a good trade-off,” DeFazio said.

The Senate passed a version of the Budget Reconciliation bill that cuts student loan spending by $9.7 billion over five years. Under this provision, lender subsidies are reduced by $21 billion, but Pell Grant spending is increased by $8 billion, and $3 billion is directed toward lowering origination fees, loan deferments for military personnel and loan forgiveness for those who teach in low-income schools.

Beginning next week, the Budget Reconciliation bill moves to the Conference Committee, composed of House and Senate members. This conferenced budget bill would then have to pass both the House and the Senate.

DeFazio said the next two weeks are critical in preventing the proposed cuts to student financial aid. He urged OSU students to network with other colleges across the country, to write their senators and representatives and to collaborate with lobbying groups such as the United States Student Association in advocating for higher education.

Gilbreath understands that spending must be decreased, but she doesn’t believe that the House’s Budget Reconciliation bill is a viable solution.

“We just hope the budget isn’t balanced on the backs of students, which is what is being done with this bill,” she said.

Mary Ann Albright covers higher education. She can be reached at maryann.albright@lee.net or 758-9518.