[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.
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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.
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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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