[Public Papers of the Presidents of the United States: WILLIAM J. CLINTON (2000, Book II)]
[August 10, 2000]
[Pages 1599-1605]
[From the U.S. Government Publishing Office www.gpo.gov]



Remarks in a Roundtable Discussion on Higher Education




in Chicago, Illinois
August 10, 2000

    The President. Thank you very much, Ken. 
Ladies and gentlemen, thank you for this warm welcome. I didn't know if 
we could stir up so many students in the middle of the summer. 
[Laughter] But I'm delighted to see you all here.
    I want to thank Representative Rod Blagojevich for joining me, and also, behind me, Representative Bobby 
Rush and John Stroger 
and Tom Hines. And there are a lot of other of my 
friends here, but I want to thank them all for coming. And I want to 
recognize that I have one special young man who works for me in the 
Department of Cabinet Affairs in the White House, Sean O'Shea, who is here with me. He's an alumnus of DePaul.
    There's been a lot of talk in the press lately about this whole 
issue of legacy, and that means when you've got one leg in the political 
grave, that's what they start talking to you about. [Laughter] But I 
think I should note that DePaul educated two generations of Daley 
mayors. Now, that's a real legacy. And I congratulate you on that.
    I also--I saw that Princeton Review survey saying that your students 
were the happiest. And I thought to myself, they're not happy because 
there are no academic standards here. That would be bad. [Laughter] They 
must be happy because of the atmosphere, the culture, the way people 
relate to each other across all their differences. And that is an 
enormous tribute, and you should be very proud of that. And maybe it has 
something to do with the basketball team, too. [Laughter]
    Let me say to all of you, we are here because all of us know that 
when we open the doors of college, we open the doors of opportunity; we 
give people the chance to live out their own dreams. And in the process, 
we strengthen our Nation and our ability to contribute to the progress 
of the entire world.
    I got to go to college because I had, in college and law school, 
scholarships, loans, and lots of jobs. And if I hadn't had all three of 
those things, I wouldn't have had a chance to go. And if I hadn't had a 
chance to go, I wouldn't be here today.
    I think it is important to recognize that while a college education 
has always been profoundly significant for certain jobs, like the one 
that you've made it possible for me to hold over the last 7\1/2\, it's 
more important than it's ever been for all kinds of people in all kinds 
of ways.
    The number of new jobs in the years just ahead requiring a 
bachelor's degree will grow twice as fast as those which don't. The 
three fastest growing occupations require at least a bachelor's degree, 
and all three pay much better than average wages. Twenty years ago 
college graduates earned about 40 percent more than high school 
graduates. In the new information economy, the gap has almost doubled. 
If we value opportunity for all, as we say we do here in America, we 
have to provide all Americans access to opportunity, and that means 
access to college.
    From the very start, our administration has worked hard on this. I 
was telling our panelists

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on the way out here, I got interested in this whole issue when I was 
Governor, and we basically got rid of State tuition for everybody in our 
State that had a certain grade average or above. And we increased 
scholarships and loan aids.
    But I got into it because in the 1980's I kept running into young 
people who told me that they had started college and dropped out because 
they had become convinced they would never be able to repay all their 
loans, especially those, ironically, that we needed the most, the ones 
who wanted to be police officers, teachers, nurses, that wanted to be in 
the serving, helping, socially strengthening professions. And we can't 
allow that to happen.
    I just talked to your president, Father Minogue, on the telephone over in Thailand, and he told me that 25 
percent of the entering freshman class at DePaul will come from families 
with incomes of under $40,000. Now, we have got to do something about 
it. I want to talk today about what we have done, what we're doing now, 
and what I think we ought to do.
    I agree with what the Congressman said. To me, it is one of the 
proudest achievements of the last 7 years that we've done so much to 
open the doors of college to everyone. We have more than doubled student 
aid in 7 years. We've increased Pell grants by more than 40 percent. We 
rewrote the student loan program to make it easier and cheaper to get 
student loans and to pay back those loans as a percentage of your 
disposable income after you get out of school. By doing this, people 
don't have to choose between paying their loans and choosing a career 
that may not be right for them just because it gives them a big enough 
income to pay their loans back. The direct loan program that we started 
in 1993, and the competition that it has fostered, have already saved 
students over $8 billion in loan repayment costs. It's made a big 
difference.
    We expanded work-study slots by over 40 percent. We now have a 
million of them in colleges and universities throughout the country. We 
created AmeriCorps, which has now given 150,000--actually, more than 
150,000 young people the chance to earn money for college while they 
serve in communities all across America in remarkable ways. We gave 
American families a chance to save for college in education IRA's, which 
meant the income wasn't subject to taxation while they were saving it, 
and then if the money is taken out of the IRA for the purpose of college 
education, it's never subject to taxation.
    And of course, in 1997 we created the $1,500 HOPE scholarship tax 
credit, which effectively made 2 years of high school education--post-
high-school education free in every community college in the country but 
was obviously available to people who went to 4-year universities as 
well.
    We supplemented that with a lifetime learning tax credit that 
applied to the junior and senior years of college, graduate schools, and 
adult education efforts for people to upgrade their skills, to try to 
create a seamless thread of lifetime learning in our country. Since 
1997, over 5 million families have already benefited from the HOPE 
scholarship tax credit.
    Now, this is the biggest increase in college access and college 
opportunity since the passage of the GI bill right after World War II. 
As a result, we now have, for the first time, over two-thirds of our 
high school graduates enrolling in college. That's a substantial 
increase from 1993. But even with all the new forms of financial aid and 
even though the rise in tuition cost has slowed over the last few years, 
the vast majority of families with people in college still feel 
stretched. After all, over the past 20 years, the cost of college has 
quadrupled. Many parents still take second mortgages or second jobs to 
pay tuition bills.
    That's why, to build on the success of the HOPE scholarship and the 
lifetime learning credits, I have proposed a landmark $36 billion 
college opportunity tax cut that will benefit millions of middle class 
families. It essentially will allow them to deduct up to $10,000 a year 
in college tuition costs, at a 28 percent rate, whether they're in the 
15 percent income tax bracket or the 28 percent income tax bracket. It 
can be worth, in other words, up to $2,800 a year if the students are in 
school at a place that has tuition of $10,000 or more.
    Today I came here to do two things--to talk to these folks and to 
announce two other steps to make college more affordable. First, 
beginning today, the Federal Direct Student Loan Program will reduce 
interest rates for students who meet their responsibilities and repay 
their loans on time. This could save more than 2 million students more 
than--and their parents--$150 through an interest rebate on new loans 
and $500 on refinancing existing loans.

[[Page 1601]]

    Right now--I'm very proud of this--right now the student loan 
default rate is 9 percent. When I became President, when the interest 
rates were high and the system was not user-friendly, the default rate 
was 22 percent. So it's gone from 22 down to 9. By rewarding 
responsibility from borrowers who pay back on time, we can bring that 
default rate down even more.
    At the same time, these two proposals I just mentioned will save 
students and parents more than $600 million in the next 5 years alone. 
When you add it up, that will save college students, since 1993, an 
average of $1,300 on their college loans and lower interest rates and 
then premiums for paying on time. You don't have to be a math teacher to 
know that's pretty good arithmetic. [Laughter]
    Second, I am pleased to announce a new loan forgiveness program to 
reward those who teach in our most hard-pressed communities. The 
students in these communities need the most help from the best teachers. 
We know that one of the most important things in education, no matter 
what else we discover, is, has been, and always will be a trained, 
dedicated, talented teacher.
    And through schools like DePaul, we're adding more and more. But we 
have to add more and more. We have the largest student population in our 
history, the most diverse student population in our history. We have all 
these schools that are bursting to the gills, overcrowded, either in old 
facilities that can't be modernized or in trailers out back. The largest 
number of trailers I've seen at any one school was a dozen. I was at a 
grade school in Florida where the school building had a dozen trailers 
out back.
    And we know that 2 million teachers are going to retire over the 
next 5 or 6 years. This is a very important issue in Chicago, where you 
have worked so hard to turn your schools around, and the whole country 
is impressed by the efforts you're making. But it doesn't matter what 
steps you take. If the young people who are dedicated to teaching aren't 
there, the rest of the changes won't work.
    Now, because of the teacher shortage, we already have too many 
people going into the classroom who haven't been properly certified to 
teach the classes that they're supposed to teach. A quarter--listen to 
this--a quarter of all our secondary school teachers don't have majors 
or minors in the subjects they teach, mostly in math and science. 
Students at schools with the highest minority enrollment have less than 
a 50-50 chance of having a math or science teacher with a license or a 
degree in the field that the teacher is teaching. Many of those who are 
qualified end up leaving their classrooms before they can really make a 
difference because of the financial problems. Listen to this: One-fifth 
of all of our new teachers leave the classroom within the first 3 years 
of teaching.
    Now, what we want to do is to put better teachers in the schools 
that need them most and help them stay there. This program would propose 
to forgive up to $5,000 in loans for teachers who stay in the classroom 
for 5 years. They'll be paying it back by teaching our kids. It builds 
on our billion dollar budget proposal to improve teacher quality, help 
retrain and recruit teachers, and put 100,000 new teachers in the early 
grades to lower class size there.
    This is an assignment we cannot afford to fail. And I hope that this 
loan forgiveness program will encourage more young people to get into 
teaching and to stay in more than 1 or 2 or 3 years. Taken together, 
these proposals will help to provide more families with the support they 
need and help to provide our economy with the workforce it needs.
    There are lots of other things we need to do in education. There are 
lots of other things we need to do in terms of tax relief. But I think 
helping people to go to college is number one. And I've also proposed 
tax relief that we can afford for long-term care, for elderly and 
disabled family members, for child care, to help older workers who lose 
their health insurance on the job to buy into the Medicare program, to 
help lower income workers with lots of kids to get more tax relief so 
they don't pay any income tax.
    And what I propose would bring a lot of benefit to Americans and 
still allow us to invest in education and health care and the 
environment and science and technology and get this country out of debt. 
I have some real hope that this proposal on college tuition can pass 
this year, when the Congress comes back. But in a larger sense, the 
American people will have to decide whether this is the way they want to 
go on tax cuts or whether they want big, sweeping tax cuts that take up 
all of our projected surplus.
    I think that is a bad idea, because first of all, the money hasn't 
materialized yet, and most

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of us can't spend money we don't have. And I don't think we ought to do 
it as a nation. And secondly, we still need to keep investing in 
education and other things that will make us strong.
    So I wanted to come here and say this. We have got to keep working 
until there is not a single, solitary soul in America who stays out of 
higher education or drops out of higher education because of the cost. 
Anybody who is able to go, willing to work, willing to learn and make 
the grade ought to be able to go, stay, and succeed afterward without 
being unduly burdened. These steps we're taking today are a good step in 
the right direction. And if we can just get this tuition deductibility 
program passed, we can really say we have actually opened the doors of 
college to every American family.
    Thank you very much.
    Now, what I want to do--for most of you, you won't be surprised, 
those of you who are part of the DePaul community, perhaps by any of the 
stories that are told. But I think it's important to illustrate what 
we're trying to do in terms of real people's lives. And so we had four 
folks come here today, and they're going to talk, and I'm just going to 
start here and go around.
    But I want to start with Pam McNeil, who 
is a dance instructor at Columbia College, and she has three children, 
ages 3 through 10. You heard that said before. Her husband is an 
advertising art director. And when their children enter college, she 
could be eligible to save, with her family's total income, up to $1,500 
for each freshman and sophomore, through the HOPE scholarship; up to 
$2,000 a year for each junior and senior; and if the college opportunity 
tax cut is enacted, $2,800 a year for each one in all 4 years if they go 
to colleges where the tuition is that high, which all will be by the 
time she gets there. [Laughter]
    So tell us about what you're doing to get your kids thinking about 
your kids' college education, even though they're quite young.

[At this point, the discussion proceeded.]

    The President. So you're going to benefit from the education IRA, 
because the money at least you can put aside not subject to taxation and 
take it out not subject to taxation. But if you could deduct $2,800 a 
year from your taxes--keep in mind, this is a tax credit, not a 
deduction--you get--the effect of it would be a $2,800 a year reduction 
in your tax bill for every student in college. It would make a 
difference in your ability to send your kids.

[The discussion continued.]

    The President. I want to put in another plug for something else 
we're trying to do. [Laughter] No one in my family had ever been to 
college before, and of course, in my generation that was not all that 
uncommon. But my family started talking to me about it when I was a 
little kid. There was never--it wasn't a question; it wasn't an option. 
If I had ever suggested anything to the contrary, I would have been 
denied dinner or something. [Laughter]
    The reason I make that point is there's still millions of kids who 
grow up in this country who don't get that message from their parents. 
And that's another thing that I hope will come out of these programs. I 
want people who think they can't send their kids to college to hear this 
message today so they'll start telling their kids what you tell yours.
    We started a program a couple of years ago that was developed 
originally in Philadelphia, that Congressman Chaka Fattah from Philadelphia sponsored, but the consortium of 
universities there were going out and mentoring kids in the schools and 
trying to convince kids in very low-income areas from very difficult 
family situations that they could all go to college if they learned 
their lessons.
    And what they did was, they had a combination of mentoring the kids 
and actually showing them what the Pell grant was. A lot of kids think 
they can't go to college because they don't even know what's on the 
books now. So the Congress was good enough to pass this program on a 
nationwide basis. It's called the GEAR UP program. We now have college 
students all over America going into middle schools, mentoring kids.
    They're also educated on what the whole range of student loan 
options are so they can actually sit down with a 12- or a 13-year-old 
student and say, ``Here's what your family income is. If you go to 
college, here's what you can get right now. We can tell you right now, 
you'll be able to get at least this. It will probably be more by the 
time you get ready, but you've got to make your grades, and we're here 
to help you.'' And the message is very, very important.

[[Page 1603]]

    So I think, in a funny way, what you're telling your kids is just as 
important as the money you're setting aside for them.
    I'd like to now ask John Schoultz, who is 
the financial aid director here, to talk a little about how things have 
changed financial aid and access to college. He's been in this business 
for 30 years, so he has seen a lot of changes. That's almost as long ago 
as I started needing financial aid. [Laughter]
    So what would you like to tell us about this?

[The discussion continued.]

    The President. I want to turn to Alicia Buie, who is exhibit A of the announcement I made today on 
loan forgiveness. This is the sort of person we need more of in America 
right now. She took a big pay cut and a big loan out to become a teacher 
in a high-need area with kids who need people like her, who are willing 
to do things for less money and more social return.
    But she's got a husband and two kids; she's 
got a family; she still has to pay bills. I mean, when the electric bill 
comes, it doesn't say, ``Here's your discount for being a good person.'' 
[Laughter] So I want her to talk about the decision she made, what she's 
doing, and keep in mind--and how she would be affected by these 
proposals.
    So will you tell us a little?

[The discussion continued.]

    The President. So under the present system, she would be--any out-
of-pocket costs she has on the college would be subject to tax 
deductions. The loans under the direct loan program are less costly for 
the reasons I just mentioned. But she'll actually get now to write off 
almost a third of her loan for being a teacher. And I think it is a tiny 
investment for the rest of us as a nation to make, to reward and 
encourage people who make the kind of decision she did.
    I hope we can--we started doing things like this--we have a little 
pilot program, actually, for younger people who just start their 
bachelor's degree, where they could teach off all their undergraduate 
loans. But it's not as big as I want it to be. And I want to keep--I 
hope when I'm gone that this thing will have enough life that other 
people will keep doing it.
    We got the idea to do this because, when I was Governor of Arkansas, 
we had all these rural places where no doctors would go. And there was a 
bill passed by the Congress back, I think, in the early seventies, maybe 
even in the late sixties, where doctors could, in effect, work off their 
very expensive medical school tuition if they would go to isolated, 
rural areas or inner cities where there were no doctors.
    And now we have the equivalent shortage of teachers, especially in 
the areas of highest need, especially for the young kids, because that's 
where the classes are biggest--what you're doing--and in the area where 
it's hard to get certified people in science and math.
    So I hope one of the things that will happen after I am no longer 
President is that somebody will come along and say, ``Let's let them get 
rid of all the loans if they serve for 5 years or 6 years or whatever 
and do other things to try to get--[inaudible].''
    Now I want to call on Heather Ely. She is a 
junior here, majoring in computer information systems. Now, there is a 
guaranteed future. [Laughter] She has borrowed a good deal of money from 
the student loan program and private sources to go to college. I want 
her to talk about it, and I want to illustrate how she could save some 
money just under the proposal I announced today.

[The discussion continued.]

    The President. You actually got hurt by the prosperity of the 
economy in that, because what happened was, when the economy started 
growing so fast, interest rates went up because there was a lot of 
competition for money and because the Federal Reserve got worried about 
inflation. And that's why I've worked so hard to pay the Government's 
debt down to keep interest rates as low as possible, because it's a good 
thing to have growth without inflation, but if you have to get it by 
raising the interest rates, you have all these unintended consequences.
    When people raise interest rates, they think, ``I'm going to do this 
to try to slow down the economy, so I'll stop people from buying 
optional things, or I'll defer the business loan for expansion.'' But 
they don't think about people on flexible interest rates, home 
mortgages, college loans, and things like that--or credit cards, even.
    Let me just sort of use you as an example. The direct loan program, 
as I told you before we came in here, will cut the cost of repayment 
rather dramatically on the part that you get from

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the Government; then if you pay it off on time, you'll save another 
several hundred dollars.
    One thing, though, I must say that you presented me today that I 
don't know the answer to is, if you did pay out of pocket right now for 
any of this money that you have borrowed--for example, if you paid up to 
$1,500 a year, or since you're a junior or senior it would be up to 
$2,000 a year--you would literally, if you had income tax liability or 
your family did, you'd get it right off the Government. That is, you 
could deduct up to $2,000 in cash.
    I don't know whether the subsequent repayment of private loans gets 
the same tax treatment, but it ought to. Logically, it ought to. So 
you've actually given me something to go back and look into. [Laughter] 
It will be something positive to occupy myself with, since I'm not a 
candidate this year. [Laughter] I need something good to do in September 
and October, and I'll do that. [Laughter]
    But if you think about it, all these cases--you ask yourself, don't 
we have a national interest that we should address as a nation together, 
through the Tax Code and through investments like the Pell grants, in 
seeing that he doesn't have to say no to any qualified student; that she 
doesn't have to worry about whether her third child will have the same 
opportunities her first child did because of the accumulated costs; that 
if she wants to make a decision to give up probably half or more of her 
income, that we don't make it harder by the cost of the transition, 
which is basically what her education was; and that if this young woman 
is willing to go out, essentially, and finance her own education all by 
herself, that she ought to be rewarded for it and not punished? I mean, 
these are just four examples. And all around here, you look at all these 
students; a lot of them have been nodding their heads through this. 
There has got to be a story like this inside the life of every student 
sitting here.
    So if you think about what you want America to look like in 10 years 
and you think about how wonderfully diverse we are, racially, 
ethnically, religiously, all kinds of ways, and how well suited we are 
to this global society we're in--here, your president is over in Thailand having a partnership today, right? 
That's a good thing. Before you know it, some of you will be taking a 
semester off to go to Thailand to study. It's a good thing. And the rest 
of you won't have to go, because by the time we get all these Internet 
connections worked out and simultaneous transmissions with good screens, 
you'll just flip them up on the screen, and you'll be there in class 
anyway, in Thailand, and they'll be here.
    Now, as good a shape as America is in today, all the real benefits 
of the work we've done together as a nation over the last few years are 
now out there to be reaped. But the absolute precondition is our ability 
to give all of our kids a globally competitive education from preschool 
through high school and opening the doors of college to everyone.
    No one contests that we have the best system of higher education in 
the world. My daughter's friends and then the children of my friends, 
all of them, they go through this college application process, and 
they're all so nervous. And I tell them all that this is the highest 
class problem you can have because, believe it or not, there are at 
least 400 places in America--right, there are at least 400 places in 
America, maybe more--where you can literally get a world-class 
undergraduate education. It's an astonishing thing.
    But if we don't get all of our kids ready to go, which means we've 
got to have more people like her, and if we don't open the doors of 
college to everybody, which means he doesn't have to say no, then we're 
never going to reach our full potential. On the other hand, if we do, 
however good you think things are in America today, believe me, it's 
just the beginning, and the best days are still ahead. But we've got to 
allow all these folks and everyone like them in America to succeed.
    Thank you very much.

Note: The roundtable began at 11:35 a.m. in the Stuart Center Cafeteria 
at DePaul University. In his remarks, the President referred to Kenneth 
McHugh, executive vice president for operations, Rev. John P. Minogue, 
president, and John Schoultz, director of financial aid, DePaul 
University; John Stroger, president, Cook County Board of Commissioners; 
Tom Hines, committeeman, Chicago's 19th Ward; and Sean O'Shea, Special 
Assistant to the Cabinet Secretary, White House Department of Cabinet 
Affairs.

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