A r c h i v e d I n f o r m a t i o n

   FOR RELEASE                              Contact:  Kathryn Kahler    September 21, 1995                                 (202) 401-3026

Statement by U.S. Secretary of Education Richard W. Riley Regarding Senate Budget Reconciliation

No matter how you slice it, $10 billion is a huge cost to impose on students, families, and colleges -- and there's no need to impose this burden. As the President has shown, we can balance the budget and increase our investment in education.

Now, the Senate Labor and Human Resources Committee -- trying to make their $10 billion target and unwilling to deprive banks of guaranteed profits or cut excessive fees to middlemen -- has hit on a new idea: create a 2 percent tax on student loans, call it a fee, and hope no one notices.

They could look to the obvious savings associated with direct lending, but instead remain captives of the special interests that profit from the status quo. It's a sad day for education.

It's an even sadder day for traditional American values. This country is rooted in the principles of opportunity and responsibility. We as Americans have always shared a common ground belief that educating our people is an investment in our nation's future. Education should never be about politics -- it should be about doing right by our people.

This tax on students and colleges is the absolute wrong way to balance the budget. Instead of dreaming up new taxes -- that would ultimately be paid by working Americans and their children -- the Senate should go back to the drawing board.