tv Washington This Week CSPAN December 8, 2013 3:10pm-5:31pm EST
for students who are not very be income, the form could simplified but not quite to that extent. universities should place limits on pell grant money to stop students from receiving grants and then dropping out of their courses. one positive example custom north carolina. they have implemented several policies to do just that. they do not disperse grants until after 10% of the semester has been completed. they disburse money in two parts to make sure that students stay around. -- what can be purchased. next, they should be prepared for the challenge of college work. this should be heightened. one option to do so would be to match academic standards that the athletic association and
also require students have taken azt in s.a.t. and have met scores. such a policy would focus on the student most likely to succeed and give them an incentive to better prepare for college. she further encourage students to graduate, it should be linked to enrollment intensity. students receive the maximum should expect to take 15 credit hours, not 12. this could be coupled with the well concept that it faces the words on a 12 month schedule rather than the academic year. facesrrent program serious challenges that we can meet them with better data, financial planning, and soon accountability. thank you. >> i think the first two witnesses for being so good about being on time. , i recognize you for five minutes. >> thank you.
i have three basic messages. the first is trend lightly. balancedd is pursue a to any long-term funding gap in the third is to attempt the institutional aid in terms of college affordability. i am a maximum pell grant recipients. one of many success stories out there. there are millions of folks who have overcome far more significant challenges out there. the pell grant program has been very successful. 40 years ago, the percentage of low income students who were pursuing a higher education was less than half of today. we'll cut the gap between lower and upper income students. making agrant is livesence to millions of has been discussed in reference
to access. pell grant recipients have less than this. after you add scholarship aid or what ever they are expected to -- out of your park it pocket, he still has $11,000 to pay for one year of higher education. their feeling that with loans, additional work, eating ramen noodles. the students are living on the edge. if you do not cut pell grant funding, the students in the range, you run two major risks. some will not pursue higher education. are a number of students are academically prepared to go to four-year institutions while under much down to two-year areitutions where they substantially less likely to complete. in doing with the long-term i think this is
appropriate and targeted spending reductions in areas that are not linked to needy students are directly. and pursues a ribbon. i have listed a host of offset options in my testimony. i will just throw out one with respect to targeted spending reduction. student leaves higher education before the term is up, they are responsible for turning the financial aid they received. right now the roles of very loose. the school gets to keep 100% of the money. if a student drops out and does not notify the school when they're dropping out, the school gives to assume the student was their 50% of the time and keep 50% of the money. if you tidings of the return of our rules, it could
be saved. and never these are on the revenue side in terms of increasing revenue. the third message. leveraging state and institutional aid in college affordability. missing number one driver of increased college tuition. high school academic preparation is the number one driver of college completion. are small players in this game. the big players are still , if we could answer the five states to at least embrace policies that ensure low income students can pursue higher education with a debt- free guarantee or low tuition with respect to indiana, you can
genetically improve college completion and reduce costs. this is not some sort of pie in the sky idea. i were to congress for a long time. congress has a long history of delivering aid in lump sums. we would suggest doing that with respect to a number of higher education programs. delivering that money to states. let states what they think is best to achieve the kind of outcome. imagine being able to say to an eighth-grade student if you are responsible and work hard in high school, will guarantee you they can go to a four-year university. he can go to a public college of atr college with a new state the very least without incurring any more debt or with an interest free loan or a cap on your debt. that type of promise as possible. have the drive to
pursue secondary education should be able to do so without ability to tag. >> thank you. you are recognized for five minutes. committee, i the am pleased to be here today to on behalfis testimony of anne arundel community college. on behalf of the financial aid staff in the nearly 6000 recipients we are observing, we're happy to engage on how we can improve the pell grant program, especially in the areas of nontraditional students, encouraging completion, identifying the media students in eliminating fraud and abuse. with almost 1200 community
colleges nationwide and millions , these are of high importance and extremely relevant to our students today. increased flexibility for nontraditional students. studentsraditional determined there is best option is to take less than 12 credits because of family and work responsibilities. the should be flexible enough to pay for the credits only. isrently, if the student registered for nine credits, he receives the same amount of pell as the student who registers for 11 credits. students are using their lifetime eligibility used when not earning the most credits allowed. this penalizes the nontraditional student who is attend full-e to time. more flexibility would be a win- win.
they would be pursuing their thattional goals at a pace said there are other time commitments. the taxpayer would not be paying for credits are not yet earned. passed thes recently college and career completion known as sb 740. website be found at the for the maryland association of community colleges. this initiative takes significant steps to better prepare maryland students for college and encourages completion once they get there. there are similar initiatives in other states but there are still a large number of states with no such progress. indicatehave data that that students who need more than two developmental classes have a significant drop in program moreetion is it follows a
general mental classes require, the more the rate drops. that tends to decrease the need for developmental education on the college level. we know who the students are. we can identify them as early as in middle school and certainly by grades 10 through 12 as there are tests in place to identify those who qualify for subsidized nails in the public schools. the recommendations are part of a report from the nasa reauthorization task for of which i was a member. this allows students who has demonstrated a high needs to auto qualify for maximum federal
aid and reduce the need for a separate financial aid application or the very least further reduce the number of questions aimed at determining financial ability to pay. direct you to the seven recommendations in my written testimony which will make a significant contribution to identifying these students. eliminating fraud and abuse. i began with the promise that they are committed to ensuring students legitimately pursuing higher education have access to the funding they have determined to be eligible to receive. ofy have the responsibility preventing those who are not eligible from receiving any type of financial aid. subject to fraud like other programs. compared, fraud and the pell
grant for grandpas lustily minimal in terms of number of cases and dollar amounts. isancial aid administrators somewhere between making the simple and quick to asking enough questions to determine eligibility. eliminating the possibility for fraud, that is students acting with criminal intentions to using federal funds fraudulent information or the information of someone else is of the highest concern to financial aid administrators across institutional type of mission goals. eliminate fraud in the program while at the same time insisting the vast majority of students are pursuing their educational goals legitimately. that is a global problem.
along with identity theft, administrators are cognizant of the attempt to submit documents that are fraudulent to support a student's claim of having little or no income, academic attainment for high school and/or college, medical documentation to support appeals, exaggerated family size or number of family members in college, residents dust and other types that determine eligibility. the department of education has been heavy cooperative to our systematically identifying foul have unusual enrollment patterns anti-amount of loan debt. and a follow-up was conducted to determine if they are who they say they are or they are legitimately assuming
appropriate educational goals or if they or someone trying to take advantage of the system. i am going to ask you if you can wind up please. you are almost two minutes over. >> some of the recommendations have been implement it at anne arundel. numbers of students that attempt to fraudulently obtain federal aid. >> thank you very much. >> i want to now recognize the chairman of the higher education and workforce committee, mr. klein, for five minutes. to the witnesses for being here. and are quite excellent testimony. dr. robinson, i am trying to
understand how your idea of requiring the students to take the sat and make threshold scores based on gpa? you talked about how you have a greater success rate. yet had a rigorous high school education. i do not understand how this ofld work for the millions what we are still calling "nontraditional students," people going back to be community college or nonprofit school to get a particular skill. they have not thought about rigorous high school or sat or a for years. we should find another term incident "nontraditional student" since the geordie are
nontraditional. how would that work? since the majority are nontraditional how would that work? >> there should be alternative standards to the new traditional student, the part-time students. i think there should be ways for students who have not achieved in high school what they found to find anfe alternative way to achieve standards. semester of progress in a community college, he becomes reality book, even if they were not under rigorous high school standards. if they had the low sat they would have to go the first , but they demonstrated
they would be? >> giving students a second chance. >> ok. that was my other question. er, i am intrigued by the pell well idea. could that be too costly? >> the cost is a good question. the way the pell well would work as you are telling a student up front how much in dollars as opposed to percentages it will qualify for. percentages based on full-time enrollment do not translate well for most students. dollars makes sense. not sure it would cost any more. you're telling them a lifetime eligibility limit based on what congress recently did which was trinket from 18 semesters to 12. tlay would be
one, i'm not sure costs would go up. >> thanks all the witnesses. move forward to a reauthorization. i think this is our 11th or 12th hearing to try to grapple with a lot of these issues. this is focused on financial aid on the pell grants and loans. it's essential to the issue of giving people access to affordable education. that is doggone confusing. thank you very much for your input here today. i yield back. thank you for also being a great role model. one person recently has suggested that we use the term
"contemporary student." that is one of the suggestions. we are looking for an alternative to using since theonal nontraditional are now 75% of students. >> thank you. as you stated, the maximum pell grant now covers less than a tuition of a four- year institution. in light of the diminishing could you power, describe the reliance of pell recipients on federal student loans? >> could you discuss that? >> the reliance of pell grants? is twice thef 10
rate. studentnow, the average who creates a four-year degree does so with $27,000 in debt. we used to have a situation where grants were the base of student aid packages. now have a situation where grants are supplemental. that diminishes students ability some applications when they leave. it has a very real impact, particularly on students with certain demographic groups when it comes to loan a version, debt going to any idea of school. >> i agree with you. you indicated that 60% of the african americans and 51% of latino undergraduates rely and ants.d on pell gr could you elaborate?
>> that is correct. there have been a number of that indicates the united states is going to be in desperate need of more students, more workers with postsecondary certificates and degrees? the students have to come from our low income and minority populations? in particular, latino and african-american. grant wille pell have an effect on college access for low income students. we should be increasing our investment. i think we should pursue targeted spending reductions in
georgia that institutions as opposed to needy students. shortfalls, almost all of them have been filled with student benefit cuts. we need to stop doing that. i have listed in number of possible revenue enhancements. one has to do with the outstanding family loan volume. every time one of the loans is the government saves money. them tod be authorizing buy down the debt from borrowers to where ever. he estimated $17 billion over 10 years can be saved. >> i thank you.
aboutr remarks, you spoke revising the return to the rules. student generally must return a portion of the disbursed financial aid. title for a includes pell grants. 8 that includes pell grants. i wonder if you have compared the information for for-profit colleges and universities which oftentimes recruit those who were not college ready and somehow get them started. they get the grant and then they quit very quickly. the numbers i've seen indicate that 25% of the money available for pell grants is used up by only 10% of the students going to college.
what if they had to return 90% of the money that they received from a pell grant because the student onto early? >> this is very important. i think there are many programs that provide a model for how to do that. think there should be instances for institutions to make sure the students actually complete. >> let the record show i questioned the amount they are returning to us when the students returned to us. thank you. you're welcome. >> thank you for being here.
that yousted to see spent some time in east lansing. it is an exciting place to be, especially with the saturday coming up. the university of michigan is in the room as well. great game this weekend with ohio state. i appreciate your perspective, especially zero with financial advisors and managers of institutions. requirement were made or rigorous, how do you think they would respond to this change? i do think this will do with the persistent specifically? tension between the eligibility requirements for financial aid in simplicity. enough thatmple needy students will apply for
financial aid. this has been greater than it is today. we rely so much on technology. do this through an online application that allows them to skip by questions that do not apply. needy, you cany import information from the irs. you're given a pass. if you move the time the we couldhave to apply, ask more complicated questions. you skip logic. they're still getting some rigorous questions from students on the cusp to find out if they are truly needy or have some financial strength that is not
currently reflected. i think schools would welcome that moves. >> would you say that would also add to the expectation of success in the outcome for student completing as opposed to just accessing education? >> i'm not sure there is research that shows the link at least in terms of the financial strength of a family and completion. more told mean successes in the fact that application so they would have confidence of the financial aid package to know how much money they would have to attend college. that would be meaningful. earlier this year i had the opportunity to hear testimony from the inspector general that pointed out of the $32 billion being spent on the pell this
year, nearly one billion of that will be going to an individual that should not receive it. have instituted discourages them prevents waste fraud and abuse. it sounds interesting. expand on that? out of the other tools that may be helpful? >> yes. one of the primary things that is an two years ago affirmative daily attendance process. with ourhat process disbursements. a student is registered full- time. before that money will disbursed. this goes over to check to see if the student has started
attending the class but the aid will be paying for. if they have not had attendance recorded, that does not move. we have closed the loophole before students read using -- registering for class. >> the students are fully aware of that. we publicized that. we do have ar faculty that does not record attendance. the student comes in wanting to know where their money is. it is a way to close that gap. done isr thing we have for all of her students that are a processe, we have we run prior to disbursing funds that gives us a list of all the students. we can peer addresses. if we were to see multiple students coming from the same address we were not disbursed
money. that yet.t found we have not found multiple students coming from the same address. we do have a process in place. >> thank you. my time has expired. >> thank you very much. >> thank you for having this important hearing. want to thank you for offering. i want to emphasize the first point which i think was tread lightly. is something we have to be very careful that we continue to have a program that provides access to these low income students. we all want to wring out waste,
fraud and abuse. advantage ofaking the system. we have all heard stories about that in the past. i grew up in poverty myself. had a single mother parent with an eighth-grade education. first-generation college student. i would not have been able to get over to college think -- if not for my friends who came from different family situations and took all those very seriously. i was determined what i would do on this. i was able to take advantage of programs like this. see ist thing i want to these programs be eviscerated him one way or another. we need to keep in mind the ultimate goal. who do not always have the most advantageous
backgrounds have access to college education not only for their own sake but the sake for our country, for the sake of the competitiveness of the united states. we need to keep the big picture in mind as well. we have talked a little bit about the skills gap. community colleges we know are extremely important in this country truth in the state of and identify the skills gap and how community colleges will be very important in educating folks so they can get into the mid-level skill jobs. community colleges are important. i was at cornell college for 24 years. keyunity colleges are the between education and workforce development. careful that we
not so restrict the environment for the students that want to go to these colleges. up.ave to tighten it we have to be careful that we tread lightly. i have one question for you. you mentioned your testimony that you lament the fact that the year round pell grant program is gone by the wayside. they try to restrain the cost of the pell grant program. can you talk to us little bit about the effects of that? >> sure. all, the institutions that are affected more than any other our community colleges and --torically lacked colleges a lot colleges and particularly. a number of students are coming in underprepared academically.
40% are having to take at least one developmental course. before they get to credit bearing work they're trying to learn what they're supposed to be exposed to in high school. that is why we should have courses forer ready students of the high school level. they are then behind at the end of the first year. they are not on track to graduate on time. what was happening over the summer, and it was expensive, is that they were catching up. when they began their second year they were going to be second-year students instead of the second new student who only has 14 credits. pell was having an impact. they are hurting as a result of this reduction. >> thank you.
of you forhank all your testimony. i normally do not take up this much of the five minutes with my own beach if you will. i do thing it is really critical that we keep in mind that we have to have a balanced approach your. we cannot cut these programs. where it will actually deprive students who are willing to take the initiative and personal investibility to themselves in these programs so they can be better students and better citizens. thank you. >> thank you. you're recognized for five minutes. >> thank you for being here today. family toirst in my go to college and a maximum pell grant recipients.
when we are having the debate on student loan interest rates are reduced -- introduced an amendment to move some of the savings to funding pell grants. financial aid making college more affordable. i think makes it more accessible. it is not necessarily mean it is more affordable. what a read through -- what are we doing to try to address the cost of a post secondary education? some theorize that we are increasing financial aid would somehow resulted in higher tuition because that is more money available. it keeps the cycle going. believe in if you the faerie and what your opinions are as to why the cost of a post secondary education
has outstripped education so much. it is very simple to come to that as the pour more financial aid into the that does the price students and families pay. he went back since the 1980s it has run fairly parallel with inflation. if you look at a price they have been paying it has been running double the rate of inflation. differentso many subsidies. state and local governments have been distant investing in higher education.
the burden of playing -- paying from college is gone from the public willing to individual families. the way they're doing it is primarily through loans. >> that is part of the problem. does not explain why this university is $50,000 now. there've been increasing their costs. on with something going federal aid fueling them in their tuition. pell grants are not largely parts of that. it is mostly ineffective student loans.
i think one possible change that could be made to the formula determining how much aid be replacingcan the cost of attendance with the median cost of college. by using the cost of attendance, a student will get more aid by attending a more extensive university. the formula is helping to feed the ever increasing costs. >> a few quick points. i agree with dr. robinson. there's a big difference between grant and loan aid in terms of tuition inflation. there's no evidence that increases in pell grants are driving increases in tuition. pell grants have been cut in tuition has still gone up. we have a relatively fine the supply of providers. supply of providers.
you have state institutions that take advantage of the high demand by cutting their own aid responsibility to students in form of high in the loans. is to maintain if not grow state aid for higher education to slow the growth and public college in tuition fees. argue that there is ample opportunity for this committee to target existing programs out of pell. curried another tommy thompson. to maintain an outcome of affordability. you can tell them to do that. let's thank you. your recognize for five minutes.
>> the seventh very helpful and informative. i want to thank our panel of witnesses. just want to pick up from the last line of questioning and answers. we have had multiple witnesses come before this committee to real oron the impact imagined of availability of federal student financial aid relative to increase in cost. fail, they have all testified there is no between federal aid programs in the extent to which costs are increasing. what they almost all testified to is that the principal driver is what you just said. retreat from supporting public education on the part of
the state and local communities. we have to assess pell and other programs. onought to assess them based our actual experience. to continuously put into the mix what is essentially a canard, that federal student aid is driving increase in costs is not helpful and does not help us assess the future of these programs as we must. want to focus on the current status in the current law. it is that pell will be exposed to sequestration with the next academic year. that could result in a cut as much as seven percent. what impact would a seven percent reduction tell two point
$5 billion? what impact would that have on the student to deal with every day? >> that really is a good question. what we expect is going to happen is the student that is fully pell eligible, 7% reduction will hurt them. it still pays for all of their classes. the amount they have four books. the more troublesome students are the ones that are getting a little bit of pell or right on the cusp. increasedcertainly the borrowing that they are going to do in order to make up for the shortfall. >> thank you. it exacerbates a regressive policy pushing student loans and
dutch students into loans. the worst cases they stop out or it exacerbates a regressive policy pushing student loans. >> just to be clear. it is portly apsley autofocus on the future but we cannot lose sight of the present. the pell is exposed to an up to one of two 7% reduction. we do not take sequestration, it will go down by $90 million. using become that used to absorb. >> another issue they have the center seems to be great currency on capitol hill, the idea of one grant, one loan, one work.
>> institutions like the idea. they also like an student need the campus-based programs, the idea of work-study. >> that is my principal concern. by definition it eliminates campus-based programs. i could see were it would be more simple for the individuals you represent. we are much more interested in making it more simple for students as opposed to the financial aid office. ability to help meet needs and have you a student getting , the additional input campus-based states can make up difference.t
>> to tinker with that? >> i do. >> i yield back. your recognize for five minutes. start outke to just with you. i am from indiana. i was pleased to see you mentioned the scholar program. as we talked about the government's responsibility, can about the 20 scholar program and the success that we have seen in indiana for a long time? the state programs, studies have shown that the one thing they do very well sell students and families upfront that there is money available to them if they meet certain criteria. the antidote we come down to from our members is is it easier for students to say i cannot
afford to go to college or is it easier for them to say college or't for me or algebra precalculus isn't for me? if you make a commitment of then takeat they will rigorous studies at the secondary level to prepare themselves for college. >> the program such as the middle school. this helps them set the path. they meet the commitment. it is not only telling that is is available but actually coming .
>> if not hundreds of thousands of students participate in the 21st-century scholar program. >> another large state promise program has been the georgia hope scholarship. through some eligibility changes. georgia hope is another program that has shown that if you promised students early that it will change secondary school behaviors to help prepare them for college. there are a lot of communities that also have promise program. there is a kalamazoo promise program and other local promise programs. >> we talked about attendance.
i find it interesting that anne arundel does take attendance was i think is a double concept. the professors actually take attendance? when students come into the classroom there is in this process. we have seen after that cutoff date there actually is a time when students would disappear? >> yes. that is true.
you want to use this as an innovative way to ensure students are not taking the loan money which we do know? >> it is one of the best ways to monitor that. when the subject came up two on a rule-making session for program integrity issues, there were a large numbers of organizations that pushback against the department of education stopped short of mandating it here at community colleges took a look at it, not just an run bill, and thought was a good way to move forward. >> do you have any idea what it cost roughly to implement a program like that? informed as to what the cost for programming was.
i know that except for a few faculty, it was very well- received by a majority of faculty on her campus. >> any other comments from the other panelists about the integrity issues? i will yield back. >> thank you, mrs. brooks. i think we have the opportunity and we can ask panel members to submit information to us after the hearing. to look intoppy that. esther holt, you are recognized for five minutes. >> thank you, madam chair. let me get a few facts straight. said the you have current pell grant is about one third the cost of attending a public edit -- public
institution going back more than three and a half decades. is that correct? >> correct. some figures for rutgers university that shows the state appropriations going to rutgers. -- the dollar amount is less than it was 20 years ago. fact, over the last more than two decades, it's gone from 65% of the cost being paid by the state and 35% being paid out of tuition and fees to just the opposite. are those figures typical of states around the country? >> that is consistent with national trends. grants are more
important than ever but significantly smaller. let me get to the big picture here. it established that the cost to the student is the greatest permanent of attending a college? >> the number one reason students cite for not attending or dropping out is the financial concerns. >> as i hear from corporate planners and economists, we need more, not fewer college educated workers in this country. does any of you know any estimates by economists of the benefit to our economy of having half a million, one million more college educated workers? >> i
don't have those numbers at my fingertips. economists have done network and we would be happy to submit for the record. that -- note they only have they cited the benefits for those completing an education, but even going to some college has economic benefit for the community and individual. is a higherhere dropout rate than we would like from pell recipients, getting them into college has benefits to you and me and our constituents? >> yes. there's a question to be asked here. to be eligible for a pell grant, you have to be enrolled in a program that is leading to some sort of certificate or degree. but there are some instances where if there are dollars lacking in workforce development or training, some students have no intention of completing a certificate or degree.
todaye of the discussion has dealt with waste and fraud and the effect of college aid on reducing individual initiative thosee preparation of that receive pell grants, particularly those on the short end of the privilege cap. but i don't want to lose the big picture here of what we are debating. it was determined nearly four decades ago that it was very much in the national interest to help people go to college. whenas it was determined the g.i. bill was passed that it was in the national interest in dollars and cents to help people go to college. closestion is are we even to a shrinking marginal return on the in a fit we get from
those people who will be incentivize to go to college because of pell grants? are we even close to getting a shrinking marginal return? the short answer is we are not even close. the difference in annual earnings between summer with a bachelors degree versus just a high school diploma is over $20,000 a year. that translates into $5,000. >> so in personal deficits or not, especially if we have a national deficit, spending money on pell grants is a good investor -- a good investment for our tax payers? >> it is not spending, it's an investment. you are absolutely correct. >> thank you. >> thank you very much. >> i appreciate this opportunity. it's a fascinating conversation.
i want to focus on the testimony of dr. robinson. hearing is important because it highlights the testimony of now moving as a away from a philosophy toward higher education that focuses only on access and starts to look at success. i'm a product of pell grants. i could not have graduated from wabash college without pell grants. i have lived the importance of these degrees great but the world has changed a lot in last 40 years. i would say the federal financial aid system is one of the great success stories in the history of the federal government. access, weal was provided access to higher education for people in this country like never before. the challenge is, when these programs started 40 years ago, access was enough. when you looked at the income potential is someone with just a little time in college, your
income potential was higher. today, that has changed. if you don't graduate with a degree that adds value to society, your income will not be higher. plenty of people are graduating with degrees that make their income higher. we have to move from a system that incense success so we make people's lives better. while this has happened, costs have gone up, so people are leaving if they don't get a degree. ify are literally worse off they had not had the access. i'm sort of a product of the education perform efforts in k- 12 in indiana. we saw our graduation rate over six years improved by 15%. really a lot of hard work from teachers, students, but a set of tools gave those. the chief was the measuring of the graduation rate.
asmeasured it to be counted a drop out. you had to enter in your senior year and not dropout rate we started as a country to measure from freshman to senior year. once school saw that real graduation rate, they were quick to bring their own innovative reforms and we have made a lot of change. measuring success rates and graduation rates and pell grants would give us an opportunity to see where we are and develop policies that not look to produce what we spend in pell grants but ways to lead the students to success. >> absolutely. one of my frustrations is how difficult it is to get information about l graham students. federal data comes out about once every 10 years. carolina, wenorth
have seen more information forthcoming. thatystem just published and from that we will be able to worksorward and see what and what doesn't. i would absolutely like to see graduation rates published so that we can move focusing on how we can make sure students get from that access to success. is way of doing that universities have to disclose. if don't have to report the information. that would be a niche is -- that would be a necessary step. the department of education has the information available to answer the outstanding questions of out what helps pell recipients become successful. yourwas intrigued by comments about the need to increase flexibility for nontraditional students. if i was to make another
observation is we have a system very focused on for homecomings, kids showing up, an 18-year-old with a back back -- could you talk about our discussion for providing flex ability for nontraditional students? >> it has already been noted here. student, 75%ional of students are going part time. while many of us think limiting the semester of pell batistuta a student can get is a good move, within that, we are now seeing that part-time student actually get hurt because their eligibility is being used up quicker because they should only be taking nine credits. it's not good for a student to take 11 credits when they should
really be only taking nine because their schedule is such that there time commitments require more family time, more work time. we don't want to see them using up that lifetime eligibility quicker than they should be. things we arethe concerned about. >> madam chairman, i yield back. >> thank you very much. >> thank you very much for holding this hearing today. it is the important tool for increasing college access to pell grants. like many others on the committee, i worked my way through them unity college and law school with this combination of grants and loans, and work- study. i truly appreciate the importance of what we are discussing today. i believe every student should have access regardless of his or her socioeconomic status and
pell grants were founded as the basis of our federal financial aid system. and it is an important topic we are talking about. i want to talk about the this investments by states in higher education. my on the moderate university of oregon gets about five percent of its funding from the state. your concerns about the issues of state funding and how it has specifically affected students reliance on the pell program. i understand it affects the need for more financial aid, but on pell particularly. has had a tremendous effect on students relying on the pell program, making pell more essential than ever when it comes to low income student access. when states come back -- when states cut back funding,
individual institutions change the nature of their aid and start emphasizing non-need based aid instead of bead-based aid instead of students who are able to paste something. faces a double hit. states are playing back from institutions and tuition is going up. institutions are also responding based aidng from need- to non-need based aid. >> i think we need some innovation. oregon is studying the pay forward and payback program and i'm interested in seeing what happens with that study. you talked about the pell promise. being such a program implemented successfully in what support is needed from the federal government if we are to do something like that at the federal level? >> the benefits we have talked level,rom the federal very little would need to change except it could be modeled on something like we do with social
acurity where you are given situation letting you know how much money would be available to you. that is supposedly empowering something similar in higher education, based on the fact somebody is already taking a means tested benefit. we know they are low income. the study in my written remarks shows that for median students, their income levels don't change greatly. are you'repoor, odds going to continue to be poor when we go into college. hopefully it will effectuate positive outcomes. >> you mentioned it is your belief that only very low income students should receive pell grants. the proposal you suggest were in
effect -- more students, would they dropout or not start college or take on more loan debt? what would happen to the students who are currently eligible? thingso a combination of to achieve a higher education. some of them might in fact take out loans. one of the reasons is the limited research available will show for the students, they to grants they do not have to pay back. >> i want to follow-up on that. you mentioned limited research. ?ommy students were studied i thought it was intriguing when you said middle income students don't benefit from pell grants.
i found that quite surprising. >> i will have to go back and look at that for you. >> mr. denenberg, do you have thoughts on what would happen if we limited pell grants to low income students? >> it is important to keep in mind that it's like the great secret of american high school education. community colleges -- the idea due to its are going to less expensive colleges flies in the face of the data. students will drop out. it will go from full-time status to part-time status. they will be much less likely to complete. >> i see my time is expired. thank you. lex hunter thompson, you are recognized for five minutes. >> thank you for hosting this hearing. to the witnesses, thank you for bringing your expertise here. ago, we wereyears
talking about the typical student has changed dramatically and i think it will continue to evolve. i know when i went to college, my cohort, it was largely 18 to 22-year-olds on campus pursuing an education. is determining how do we make these programs flexible enough to meet people's educational needs at every point in their lifetime? it's not where you start, it's where you end up. the key to that success is education. noneed a dynamic row graham, doubt about that. i want to come back to a couple of points in the testimony. of students at your community college or nationally require remedial education? numbern't have that readily available. i do know that i have been told it's a relatively high number.
context, some of those students are testing into remedial math and one of the really goodhey were students in high school and by the time they got to grade 10 or 11, they had taken all the math required, so they were taking nothing in grade 12. when they went to do the testing, they were showing they needed a developmental class to take college-level algebra. so there is some context, but it's a high number. >> i just spent some time in southern arizona talking with the officers in charge of the educational system there. they are training soldiers and officers and remediation is a big heart of what a do their. the pell funduch we used for remediation at this point? studentst we do know can take up to 30 credits or the
equivalent of her medial courses and i'll grants will pay for it. students are stopping far short of that because they are not able to continue to pass the courses. >> it looks like you have your hand on the buzzer. >> about one in three college students are taking remediation nationally. 50% of students into unity colleges are remediating. just about a third in four-year schools. pell grants cannot be used solely for remediation. they can take remedial course work if it is integrated into a rich pointed out, there is a cap on how much remedial education you can take to the pell grant. an insignificant dollar amount, but it is not unlimited by any means. >> dr. robinson, your testimony
talks about slipping the -- shifting the definition to encourage college completion. the benefits are kind of obvious , reducing the overall accrual to earn yourder return on investment sooner with your education degree. it is not the degree that is of value, is the return of investment that comes from it. any thoughts on what impact this would have given nontraditional students? given where the educational system needs to be, being more flexible to run a person's lifetime or pell eligible students. significanthe impact comes from how you go from that 15 hour point. the way you prorate for hours after that makes a big difference.
you paynberg mentioned the same for nine and 11. i think the prorating should be 11, 9, 10, all of the prorated, so students are using that money as they are taking courses and not having to pay for time they are not taking. i think it should be coupled concepts sol well that students can go over summer. the main point in going from 12 to 15 is that if somebody is currently full-time at 12 hours, that her son would be much better off to be 12 full-time than 15. so that they don't have six years of debt or five years of debt when they do come out. >> my last is a request from all the panelists. developingt is financial literacy among students and parents so that tasks with asing
return on investment. if you could submit to the committee and he thoughts or recommended research you have seen on how do we increase thatcial literacy among traditional what has been -- i don't think it is traditional anymore, that post high school, post secondary into college, that would be very help all. >> thank you. >> thank you madam chair and bank you all of you for being here. i feel like a great example of somebody went through the uc system far too many years ago. when i talk to students and tell them what i paid for, it wasn't even considered tuition then. they're shocked i that. that is a shift.
students hadny look for other sources of income. ask, dr. robinson about your comment. i wasn't sure what you base the claim that pell grants to i'm notlass students -- sure that is always middle-class in everybody's mind, but whether they are less likely to graduate. with the causal relationship there? it is based on the beginning, the longitudinal studies the federal government puts out. the cause is in that income group, and they are more responsive to money they will have to pay back. the knowledge that they have a loan they will have to pay back at the end makes them more likely to graduate. --
to $50,000 range. the authors of the study only speculate on causation. this is research that can't really establish a causal pattern, only a relationship. but that is what they found based on research. >> i wonder if anyone else would like to comment? how does that stack up? >> think one of the most interesting pieces of research , need-based aid of low income students, a study published in -- by the national bureau of economic research, run control studies and looked at pell students adding a supplemental need-based program in wisconsin and those who are not.
for ahey found was thousand dollars in additional need-based aid to pelz didn't, those students were going to return for a second year of over at a rate of a little four percent higher. the point is increased investment increases the likelihood of retention. that there a sense community is counting on the students in some way? does the fact that students deal it is a little more accessible and valued at a have a contribution to make or give back? >> i think that is especially true with the thomas programs justin was referencing. applause, giving him i want to criticize the idea that we can just give students an eighth grade a statement of how much financial aid they will get. it's not enough trade americans
will overestimate the cost of education. what indiana does is much under. it provides a guarantee that you can go to school debt free. there needs to be a content. >> was it rather than targeting the student that you targeted the schools in terms of making some of the changes that need to be done? there are loans outside of pell that you need to deal with. could you be more expensive about that? are there some ideas now out of that people talk about but we are not quite willing to move forward on? >> you are right with respect to institutions. that has been a big area we have neglected. the importance of institutional roles. what an institution does makes a
tremendous amount of difference when it comes to completion. we see similar institutions with a similar student body that get dramatic -- they get dramatically different results. any effort to revive -- to find funds, to hold them accountable in terms of completion. san diego state is one of the better schools in the country low income,s to underrepresented students as compared to their peer students. >> a number of that is based on systems using mentors and a host of community organizations. thank you very much. >> mrs. wilson, you are recognized for five minutes. >> thank you, madam chair for holding this hearing.
programral pell grant is a lifeline for more than 9 million students every year area the program can make the difference between a life of poverty and a good, meaningful middle-class career. the pell grant program is a lifeline for the economy. for african-american and latino students, education is the only steppingstone out of poverty. there are very few dollars to inherit from the family trust. there are very few african- americans and latinos that can save enough to send their children to college so the pell grant is key. we need more students to undertake higher education in order to close the skill gap and boost nativity.
but so many families are struggling to cover rising costs. thee some exaggerate funding gap with regard to pell, the fact is the program has been cut by more than $50 billion and is projected to remain stable. know theortant to growth and pell grant costs has number ofo the eligible students in this time of high unemployment. not due to policy change. what this says to me is we can reduce the cost of the pell grant program by getting americans working again. once we can get americans working again, we will have fewer enrollees and fewer families requiring assistance. this congress has to turn back to its regular focus on jobs.
questions for all of our witnesses. focus on thes pressure and nontraditional school years model, it's often impossible for low income students who support them selves and other family members, what's a reasonable number of semesters somebody should be eligible for pell taking into consideration the fact that impact low income students, especially latinos and african american students? our perspective, the aggregate limit may not be off. would advocate for his students to enroll on an ongoing basis. instead of reaching a summer
term or semester saying i have no more pell grant eligibility and i'm going to stop out, that increases the likelihood of them not returning that they could continuously and provide a wealth of funds. has been a lot of talk about the contemporary student, which is a good term as well. the contemporary students gets their degree in five years, not for. it's 150% of time working over and antiquated calendar of four years to a bachelors degree. it is now five years to a bachelors degree. we should ask ourselves if we should be a link back even further on the amount of eligibility students have in terms of time or dollars. >> we have talked a lot about disinvestment from the state.
i would like to find out what you think could be done to ensure this investment in higher education funding on the state continue to erode the purchasing power of the pell grant. what can be done to help with >> i'm looking at congressman tierney because he is a champion of the provision that appeared in the college access program and there's also a stafford provision that appeared in the american recovery and reinvestment act for higher education funding. there is such a substantial amount of funding, that is the problem. what can be done? the feds can provide a substantial amount of funds to states and institutions in order to leverage increased support in
terms of investment or push on the institutions to keep cost down. you can do that by targeting funds outside the pell grant program and outside of subs -- outside of subsidized loans. >> any other incentive ideas to incentivize states to invest more in their colleges? dr. robinson, i would like for you to elaborate rather on the limited studies that show low income students respond better to loans and grants. what in your experience and research have you found to be the impact of high debt burdens on persons purchasing power while being a lifetime career prospect. to ask dr. robinson that she would submit her
response to you in writing. i would commend to you the study dr. robinson has authored entitled pell grants, where does all that money go. i'm sure she will make available to you a copy of that. it has a great that we ought murphy. let me start where you were talking earlier. we did try to put a maintenance of effort provision into the opportunity act. but it isof that, very small as the set off on that and we had quite a fight just to get that. one i look at your comment about an offset to i and a taxable
estate and in douche mill fun for needy students, could you explain a little more about what those 10 ideas were and how it would work? >> sure. loanse identified grants, him and tax benefits. let me start with the low hanging fruit. tax benefits. it used to limit out at a hundred $20,000 -- $120,000. the obama administration, which it has been a andable accomplishment increases the income level at which they can increase in income level up to 100 $80,000. we went from the 80th percentile to the 95th percentile.
700 million dollars year. why can met romney -- i have three 500 29th, but why can met romney get a 529 when we have students in desperate need of pell grants? >> so you have to find a way to get back to the general education treasury. that is interesting. we may follow-up of yet no objection. the other is financial incentives to borrowers and owners who have loans to get them to convert third debt. have you worked out a consensus as to how that program would work? >> the department of education administered a similar program that allowed borrowers who had felt loans -- poland to
consolidate them and give them a low-interest rate in doing so. that effort more aggressively implemented by the secretary to have sizable consolidate into the direct loan program. we will cut your interest rate and give you cash back and lower your principal. you, the student will benefit. the federal government will benefit because we won't be paying out as much in subsidies on these old loans which a lot of providers would like to get off their books because they no longer have the same incoming stream of new federal funded education loans. mentioned the cost of books for students. we recently filed some legislation to try to get the textbook materials more
accessible through online provisions. tos anybody want to speak the impact on what is now a pretty high cost of textbooks? hashe cost of textbooks definitely increased over the last number of years. .t keeps going up most institutions i am familiar with have a variety of ways students can get those books. a implemented a process couple of years ago where they can actually rent the textbooks. we always have a buyback provision. they can rent them. they also have the opportunity onlinehase textbooks from a non-college writer. the problem that we have right is for those community
college students that want to buy their books electronically and providing them money up front so they can get those textbooks electronically. we have resisted doing that because we found historically when we provided money up front before the classes actually started, students took the money and did not show up for class. that issue isnce an ongoing problem for us. >> i now yield myself five minutes. taxpayers deserve to know if their hard-earned money is being spent appropriately by the federal government. your testimony talks about the lack of data points to show how pell grant students are very in college.
we have talked a lot about this issue as several members have raised questions. could you share with us what specific data points should be added into the law during the upcoming reauthorization to help provide us with better information on help l grant students are doing. six is to the first enforce what was already started in 2008. at the disclosure institutional level to require her -- requiring it. disclosure is only minimally the data it requires on a widescale basis and it is that they do we need to do and he kind of methodological look
at how students are doing. secondly, the post secondary educational longitudinal data are extremely important. i think it would be very nice if that could be done more often. begin -- that began in 2003 and 2004 and we can't expect more data for quite some time. seeing that data every five years would be considerably more helpful than the rate at which we see it right now. it is that longitudinal data that tracks students over time that allows us to see what moment arom the student enters to where they are for, five, 10 years later. most importantly, that data must be transparent. the department of education needs to be able to look at the
organizationside , itndividual institutions can add lot of insight to the arguments about pell if they have access to meaningful data. >> thank you very much. can the reforms you talk about help pell andony super pell be implemented without dramatically increasing the cost of the program? how can we be sure the program doesn't continue to grow with the rate we've seen over the wet five or six years? >> have already seen the cost of the pell grant program leveling out. partly the cause of a partial or slow recovery and partially because congress has rolled back some of the eligibility criteria
. in my written remarks, i included the eligibility changes . the reforms we put forward we do not believe over a five-year time frame would cost radically more because congress has put in place limitations on the full extent to which students can utilize a pell grant. we are working on making that information available to students much earlier and giving flexibility so that contemporary students can use them for an innovative model program. or on an ongoing basis. until they exhaust eligibility. >> thank you very much. how can the federal government assist institutions in easinging fraud while the burden on financial aid offices?
>> i think they can continue to do what they started to do about 18 months ago when this was becoming more of a problem .ationwide the follow-up with the students that hollow up with our records when they come in is extensive. what we have found in the follow-up is that many of those students were not really legitimate students. the transcripts that came from other colleges when they finally turned showed little or no academic progress whatsoever. continue to do what they put into lace, but certainly require every college that has large numbers of students moving from school to school to make sure the records they get in have been thoroughly
reviewed and those that are not progressing academically when they are changing schools, the eligibility for financial aid simply is not there coming through the door. to come in and establish their own academic record at the college. >> thank you very much. thank all of our witnesses here today. you are a distinguished panel and we should very much appreciate you taking the time to appear before the subcommittee today. you have given us a lot to think about and a lot to read. your testimony is really expensive. there is a lot to read and consider. you have someo closing remarks question are >> on behalf of the ranking member and other members of the panel, and like to thank you for the work you prepared in advance.
your testimony and your availability on an ongoing basis to help us formulate some policies. the ranking member and other members want to let you know we want to strengthen the pell grant program and continue to expand affordability and accessibility to college and hope lee both sides of the aisle will work toward strengthening the pell grant program and make it a top priority for congress. with your efforts, we will be able to move in that direction. thank everybody for their work in this hearing. >> thank you. most of my colleagues have made comments about having come from low income families and work their way through college. some of them utilizing the hell grant. who have been us involved in higher education understand the value of the pell grant program. i will one up my friends a little bit by saying not only
did i come from an extremely low income family, i worked my way through school. i worked with students who received pell grants. thes around in 1972 when program started and i remember it very well. low income students at appalachian state university. i ran a program for disadvantaged appellation and african-american students. i am very well aware of the value of financial aid, particularly the pell grant program. know we all want to strengthen the program so it is available to the truly needy students because there are students out there who need it and there are students who can benefit from the program and in a fit our culture as a result of attending higher education.
we want to utilize these hearings to highlight the problems or concerns that exist and figure out ways we can date the federal laws to make sure they are keeping up with how our universities are educating , i have noticed a plethora of dueling statistics. maybe more than usual. to keep in mind how we utilize statistics to define the problems that exist. several of you discussed how the buying power of pell grants has the -- has decreased significantly over time. but according to figures calculated by the congressional 72%arch service, it covers of the in-state tuition at four- year public institutions.
know it covers more than enough democrats to fees and tuition that community colleges. i think we can all find statistics to help us to find our arguments and powerpoint, we just need to make sure we understand the context in which -- in which these statistics are being used and as we go through with further hearings and looking at these programs, we will do our best to make sure we have data and all of you, especially dr. robinson has need to getthe reliable information. that is something i am very much interested in and i think all of us are. can make sure the truly needy students are getting what they need trade i thank everyone for being here. there being no further business, the hearing is adjourned.
journal" the latest on the budget negotiations. after that, the huffington post reporter talks about the role of medicaid under the health care law. then a look at how personal costs fit into the budget at the defense carbon. that's "washington journal was 7:00 live every day at a.m. on c-span. is thewireline world central circulatory system of our economy erie it is the veins and the arteries that connect what is the information economy in the united states. we are seeing data traffic increase at the rate of 40% the year. it is wireline networks that connect all forms of communication whether they originate in the wireline environment or a wireless environment.
>> the future of the communications industry with walter mccormick, monday on "the communicators." >> i got upset with the press my mentaley covered in the first few meetings i had and then they never showed up anymore. then i was walking in the downsized lore in the white house and the woman who was one -- she said people mental health is just not a sexy issue. the mental health act of 1980
and what he said was involuntarily retired from the white house. >> first lady rosalynn carter, monday night at 9:00 eastern live on c-span and c-span three, >>pan radio and c-span.org. former secretary of state clinton clinton received the 2013 human rights award at an event on capitol hill. in her remarks, she talked about the recent passing of nelson mandela. this is 15 minutes. >> thank you. thank you very, very much. thank you. [applause]
first to the extraordinary lonza's family, this is indeed a great honor and toimmense personal pleasure have tom lantos around my neck. he was often in my office or on the phone. me what i was going to do about something or offering to partner with me on an issue with human rights. as all of you who are here no because you recognize the significance of the work he did during his public career, he was a man of great courage and compassion and had a wonderful partner in his , and a fabulous
support system with his daughters, katrina and annette and their families. i think we should give a round of applause to the entire family here today. [applause] as he said when he began the proceedings, we meet on the day after the loss of a giant among us. of his who i the power example demonstrated unequivocally how each of us can toose how we will respond those injustices and grievances, those sorrows and tragedies that afflict all of humankind. nelson mandela will be
remembered for many things. he will be certainly remembered dignity,ay he led, his his extraordinary understanding not just of how to bring democracy and freedom to his beloved south africa, but how important it was that he first rock freedom to himself. spent time with him until just in92 the last year and a half, i was always struck by the of his self- depth awareness of his about how hard it is to live a
life of integrity, of service, but to combine within oneself the controvert -- the contradictions he lived with, a , ayer, a freedom fighter prisoner and a leader, a man of anger and of forgiveness has so the hearts of people not only in his own country, but as we are seeing with the response and the outpouring after his death, people around the world. i only hope that as we both mourn and celebrate the passing of this universally recognized and beloved figure that we through he became that
an enormous amount of hard work. the story has been told several times now in the coverage i have watched of his passing about how he invited three of his resume regards to his inaugural festivities. as a part of the american delegation for the inauguration and i was there at the luncheon that was held back on the grounds of the president house that had transitioned from the morning where i had breakfast with president the clerk to where i had lunch with president mandela. largelooked out at the peopleathered, including who had been part of the
struggle itself against apartheid and who had supported that struggle, he made the point of tanking his jailers. and pointing out that of all the distinguished bip's who were there, he was most grateful that these men with whom he had exchanged words of recognition and acknowledgment of the other's humanity over the course of that long imprisonment could be there as well. as we think about nelson mandela, it brings to mind very much to meet tom lantos because here were two men who had seen the worst that humanity could offer. objectified, denied
their right to be a jew in hungary during the holocaust or a black man in south africa during apartheid. they had every reason to come cynical.t embittered, believing for the rest of their lives the only thing would -- that would matter is acquiring demonstrate able to their influence, especially against those who had been denied them the right to be new they were. aboutlways struck me nelson mandela and tom mentos curiosity, thee
enthusiasm for life that they brought with them out of the depths of such suffering. people that heny had to learn to forgive and he had to leave his anger behind when he walked out of risen on the viewer 11 1990 or he would have remained in -- or he would have remained a prisoner. a prisoner of his own feelings, of his own resentments. escaped thewho worst example of humanity decided to become an advocate who isryone anywhere
thatg the kind of fear comes with standing up for yourself and your fellow men and women. so we honor to great men by being here today. two men with him comparable souls. and we also have just grave --ged other other grave human rights activists who have received this usze and who stand before because each of them has also to come upit is like against governments and powerful forces who are determined to squeeze the hope from your heart. , to breakn your mind
your spirit. -- stood up to that kind of depression -- that kind of oppression and escape from others -- escape from it as tom escaped from the holocaust and ran from it toward freedom. i am glad the united states is the place he ran toward, that it was our country, thanks to havee like tom lantos who held high the banner of human somethingnot being given to you, but something you are endowed with. paull, thank you because you stood your ground. you stood in the face of another or that was almost unimaginable. genocide in our time.
you saved and protected others. in a great example not only of courage, but compassion. , we arether here reminded of those who have given hopech to ensure that the that is represented in tom's legacy lives on. this foundation really embodies tom's spirit. it is quite humbling for people like madeleine albright, my dear friend and i am a to know secretaries of state come and go is thatat remains
profound commitment to making a difference in whatever position we find ourselves and standing up and speaking out for those who might otherwise never have a voice. honored to be giving this award particularly on behalf of two causes near and dear to my heart. women's rights and internet freedom. i want to acknowledge publicly grandson work tom's did for me in the state department and continues to do and that intersection of civil and howand government. we can help people help themselves to make sure their voices continue to be heard. is article that
we look broadly globally about why this mission many of us the fullor participation of women and girls and their society is so important area it's not just the right wing to do. it's not just a recognition that women and girls just like men and boys deserve the opportunity to live up to their own god- given potential. it is because we know where women and girls participate in economies, economic rose is greater than it would be without them. where women and girls are given the chance to be educated and get the health care they deserve to have, we know that societies benefit. where women and girls can participate in peace making
and peace building as full members of society's trying to resolve conflicts, we know that beolution is more likely to sustained. honor for me to but it is just, a reminder of how much more we have yet to accomplish, to make lifetom's dreams and tom's , the examples of the award recipients with us and those unable to come like the delisle, bring out in each of us our own commitments to what we will do to further the cause of universal human rights for every man, woman, boy and girl in the world.
it is certainly what tom would expect us to do, to hold his and by accepting this award and knowing tom would not let me off the hook otherwise, it is something i will continue to be committed to in every way fiber ofn with every my being because the kind of world we want is a world in which the nelson mandela's and the tom lantos is can be proud. thank you very much. [applause]
>> tomorrow, british administered david cameron and members of the parliament will offer tributes to nelson mandela who died her stay at the age of 95. we will have live coverage on c- span two at 9:30 a.m. eastern. >> if you missed any of this morning's "newsmakers" you will have the opportunity to watch it again today at the clock eastern on c-span. the guest is representative adam smith, the ranking member of the house armed services committee. he talked about issues relevant to the military. >> in a survey of major 1909, the made in kansas city star was rated more in favor of a reform than all
the other major metropolitan newspapers in the united states combined. as nelson himself told an interviewer in 1910, i don't want the star's editorial to be a lot of literary essays, i want to get things done. nelson followed up his strictures on past performance with an editorial that reject the notion that roosevelt was a man on horseback who seized power to become dictator. he is a gold are recalled to his work, said the paper rather than a man on respect. after roosevelt's arrival from africa amid talk of his candidacy, there were clubs formed, back from elba clubs, like napoleon. >> the impact of william rockhill nelson on the american progressive movement and teddy roosevelt's campaign to win back that is latere today on american history tv.
after the war, things escalate so quickly. a moment that seems so loving can just turn and flip and be so out of control. and it one of those days ended with adam packing to leave and him going to his things and seeing a hidden handgun. he says i want to take is to sell it because i'm going to need some money. on top of the other pressures, they had no money. he came out gun and with a shotgun and really tried to jam it at her so she would pull the trigger and kill him. as i describe in the book, she wanted to. >> the return home is only half the story. david finkel follows the men of the 16th infantry tonight at a." on c-span's "q and
>> republican senator rand paul spoke at the detroit economic club about jobs and the economy. legislation hew plans on introducing when the senate returns this week. some have considered him as a potential candidate in the next presidential election, though he himself has not made any formal announcement. event is part of c-span's road to the white house 2016 coverage. [applause] >> good afternoon, ladies and gentlemen. on this nice, brisk detroit michigan day. introduce dr. to rand paul, the junior senator from kentucky. he was elected in 2010 and certainly has made his mark in a very short time. he has proven to be an outspoken
champion for constitutional liberties and fiscal responsibility. and a warrior against government overreach. among his first legislative proposals, cutting a $500 billion federal spending proposal and a plan to balance the federal budget in just five years. he has since introduced several bills with growing support. in the senate, he serves on the foreign relations committee. education, labor and pension, homeland security, and government affairs and the small business community. a graduate of the duke university school of medicine, he was a practicing ophthalmologist in bowling green, kentucky, for 17 years. 1995, he founded the southern kentucky alliance i clinic, an organization that provides eye exam and surgery to needy
families and individuals. he still does that pro bono work today. vocalr paul has been a advocate for term limits, a balanced budget amendment, a read the bills act, and audit of the federal reserve. he has also gained prominence for his independent positions on many political issues. now, on a personal note, senator paul is a devoted husband and father. he's been married for 23 years to kelly, and has three sons. and you can see him at green high school cheering on his son, who is a soccer player, as they went into the semi finals. our history here at the detroit economic club is to showcase
interesting and diverse ideas and solutions to issues of the day. today, senator rand paul will unveil his new legislative proposal to remove bankrupt detroit and other economically blighted areas from poverty and the shackles of big government. please give a warm detroit, michigan, welcome to senator rand paul. [applause] >> thank you very much. people ask me how big a deal is it to give a speech to the detroit economic club? and i say it's such a big deal that i gave so many speeches and interviews saying i was going to give a speech that i lost my voice. and i'm not kidding you. it is a big deal to be here and i'm really glad to be here. there was a little girl you may
have heard about her. she wanted $100 and she decided she would write a note to god. she wrote a note and said dear god will you send me a $100? i promise to do good. the post master didn't know what to do. so he sent it to the president. the president said that's cute. so he sent $5. so she write a letter back saying dear god. thank you for the $5. but next time please don't send it through washington because they stole $95 of it. [applause] it is an honor to be here in detroit. i want to thank beth for making the trains work on time. and i would like to thank you
all for letting me be part of this and helping us get to detroit. i think when i started thinking about this speech, i thought we need to find out something great that's going on in detroit. so i was looking for somebody who said something nice and i found something by jack. and i thought i would have to sing it. but i did find a young intern at quicken loans named lisa. she said, i found out the truth about detroit. it's unstoppable. not because it's wealthy, powerful, and growing -- because it isn't -- detroit is unstoppable because the people here cannot be stopped. the citizens of this city are the light at the end of the tunnel. the one man left standing. the underdog who actually wins. they are optimism, promise,
potential, and hope. optimism is bringing this city back. this city is isn't afraid of opportunity. it's not discouraged by its past. it's excited about its future. i just loved the way she put that. a young woman who really believes and is optimistic about detroit. detroit's future and lisa's future will not come from washington. the magic of motown is here in the city. it's not in some central planner's notebook. what detroit needs to thrive is not washington'sdom nearing hand but freedom from big government's mastry. to thrive, detroit needs less government and more freedom, less red tape, less punitive taxes, more money left in detroit. the answer to poverty and unemployment is not another government stimulus. it's simply leaving more money in the hands of those who earned it. today i'm here to introduce something i call economic freedom zones. this is a bill that will be introduced next week in
washington. these freedom zones will dramatically reduce taxes and red tape so detroit businesses can grow and thrive. freedom zones are similar to an idea jack kemp introduced a couple decades ago. kemp loved figuring out ways to empower people, real people, regardless of race or family background. he called his plan a conservative war on poverty. it's time we revisit some of these ideas of jack kemp and expand upon them. i told somebody recently, this is jack kemp's enterprise zones on steroids. the bill that i will introduce will introduce these and empower and begin these economic freedom zones. this bill will lower perm and corporate income taxes in detroit to 5%. my bill will also lower the payroll tax 2% for the employees, 2% for the employers. economic freedom zones will cut out the red tape that keeps new businesses from starting and old businesses from thriving. inside these zones will suspend
the capital gains tax, encourage greater investment in business and real estate, and we will allow all small businesses to deduct most of what they invest in the first year of the purchase. how will this differ from a traditional government stimulus? well first, these zones don't ask houston or they don't ask atlanta to bail out detroit. these zones free up detroit to bail themselves out. this isn't just about detroit. i'm a politician. so i'm a little concerned about my home. we're concerned about kentucky. we're concerned about any zip code with unemployment greater than the average. so any community in america with 12% bralksly or more would be eligible for these freedom zones. these would be struggling communities across america. it would include many in my home state. there are 20 counties in my part of the state who are in a depression right now.
we're struggling in my state, too. the freedom zones differ from traditional government stimulus in that no central planner, no politician in washington will decide who gets the money. the money will simply be left with its rightful owner. the man or the woman who by sweat equity earned it. the freedom zone stimulus will work where traditional government stimulus hasn't worked because the government stimuluses that we've had, the money gets passed out to special interest and those who give you campaign contributions. it's not based whether they can do anything or run a business. those are the people who get the stimulus money. in this plan the money will stay with the people that consumers have already voted for. the people that democratic capitalism has already run through the gauntlt. the people have already proven that they can run a business. too often when government picks
the winners and losers we wind up with mostly losers. think sol indra. over 500 million of your dollars was given to one of the richest men in the world. why would we be given a loan? the president says he's for the middle class. why would he be giving a loan to one of the richest men in the world. but people didn't want this guy's product. so it went out of business and we lost the money and we're stuck with the tab. economic freedom zones won't make that mistake. the lower taxes will benefit any business that consumers have already seen fit to endorse. only consumer tested winners will get the money. and through their success create jobs, more jobs for the rest of us. economic freedom zones will over a 10-year period, if my bill were to pass, leave over $1.3 billion in detroit. so those who say oh it won't work, there won't be enough money, we've calculated it. $1.3 billion stimulus not from
houston, not from atlanta, from you. it's your money. we're not going to take it to washington. we'll leave it with you. how could anybody be opposed to this? [applause] the $1.3 billion will be left and will help detroit to thrive again and create jobs here. the money won't go to my friends or president obama's friends. it's just going to go back to the people who earned it. it will go to the friends of the consumer. regulatory relief will also help create opportunity. it will lower the opportunity costs that hold new and old businesses back and cost detroit millions of dollars a year. if we use numbers from a similar project that happened in maryland, i estimate that repealing some of this
stormwater craziness that they're forcing every city to do would save detroit $16.5 million a year. i'm guessing that would pay for some police protection, some fire protection, and all the basic things you want in your city. but we also want to encourage entrepreneurs not only in detroit but we want people to move to detroit from around the country and around the world. we want to allow immigration to our country where people have capital. right now we're losing people. people are going to canada because the income tax is 15% so canada is getting all these great entrepreneurs from around the world and we're losing them. why? corporate income tax is 35%. economic enterprise zones would expedite these visas for people who have $50,000. let them come to our country. i don't think you want a handout. just look at your history of innovation. look at the proud history of detroit. look at henry ford who not only produced a car that his assembly line men and women
could afford to buy, he also shortened the workweek and increased wages. we were the industrial giant of the world. detroit was the greatness of america. government didn't do this. you did this. government didn't discover and create motown greats like smoky robinson or diana ross. today doesn't need to be any different. we need to look at ourselves, look in the mirror and allow ours the freedom to create and innovate. you have leaders like this. think of dan gilbert of quicken loans that are pouring their hearts and souls and money into detroit. quicken loans has spent more than $1 billion in detroit over the last few years and moved 3600 employees into the city. creating thousands of jobs. quicken loans and sister companies have 12,000 employees working in downtown detroit. quicken loans is proving all the naysayers wrong. go to quicken loans at woodward avenue and you'll get a glimpse
of detroit's future flt the result has -- i don't say this to make a partisan point. the fact is both parties are to blame. there's enough blame to go around. both parties, democrat and republican, they must admit that we haven't done all we could do for the people who live in the cities, particularly detroit. many have said the problems we see in detroit, well, it just means it's the end of time. we're done for as a country. woe is me. let's give up. they say we can't create enough jobs. we'll never do it again. i disagree. they say the schools will get worse. i disagree. they say the divide between rich and poor will only grow. i disagree. i don't believe it. i don't believe it for a moment. anywhere else detroit or anywhere else in the country, this is the end of times. we are the greatest country on
ert. and have developed so much capital because we believed in freedom and we believed in ourselves. but for this to come true again, for us to revive our cities and our economy, we have to try to do something we haven't been trying. we can't just keep doing the same thing over and over again and expecting a different result. what we need is a new vision of prosperity, one that won't leave whole communities behind. politicians have thrown our money at problems before. the bailouts, the stimulus programs. they haven't worked. this current president gave you $1 trillion. not detroit. he gave the country $1 trillion in stimulus. you divide it up and it was $400 per child. tun employment numbers didn't budget. it doesn't work. let's try something different. we spend unbelievable sums and money on education yet our schools are falling apart. throwing more money at them is not the answer. we have to allow them to innovate.
we must reverse this trend towards big government. we must end capital welfare, crony capitalism and the limits that stifle us. we must encourage policies that lift up the individual, improve the schools and get us back to work. it can't be a bailout though. it won't work. it will just lead us further down a path of dependency forever subjecting ourselves to half baked ideas and mandates coming out of washington. more jobs are only one part of this solution, though. i believe we must also show that we can build on a government that values our god-given rights of all americans. in addition to economic freedom zones we have to have a 21st century civil rights agenda with education, choice, voting rights, and prison reform as its foundation. no one's life should be ruined because of a youthful mistake. no one should be thrown in prison for years and decades when they haven't hurt anyone but themselves. no one should lose their voting rights because they spent time in prison. it does us no good to create
jobs for young people in detroit if they can't later get such jobs because of an out-of-control war on drugs. mandatory minimum sentences that force judges to give 10, 20, sometimes 50 year sentences for drug offenses are crazy and they've got to end. it is a human tragedy. it is an idea of justice. and there need to be new voices from either party that will say it's time to change. this is whay i've joined with democrats on this. [applause] i've joined with democrats on this. i'm working with senator leahy from vermont to try to give junls more freedom, more leeway when it comes to sentencing. if it were your kid would you want to know whether it was their first crime? whether there's a chance to rehabilitate them? whether it's a drug addiction