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

Challenging the Status Quo: The Education Record 1993-2000 - May 2000

8 Opening the Doors of Higher Education to All Americans

More financial aid is available for college than ever before, and students are going to college in record numbers.^[38]

In the first five years of the Clinton-Gore Administration, the percentage of high school graduates going straight to college rose from 62 percent to 67 percent—an all-time high.

Among low-income high school graduates, almost 44 percent immediately went to college in 1992, and 47 percent immediately went to college in 1996—also an all-time high.

The surge in college-going has occurred not only among whites, but also among African Americans. About 55 percent of black high school graduates went straight to college in 1995, up from 50 percent in 1992. More than one-fourth of all students in higher education are racial and ethnic minorities.

The fraction of Hispanic 25- to 29-year-old Hispanic high school graduates with some college grew more than one-tenth between 1992 and 1998, from less than 47 percent to nearly 52 percent.

The fraction of 25- to 29-year-olds with a bachelor?s degree or higher increased by more than one-eighth between 1992 and 1998. During this period, the fraction of black 25- to 29-year-olds with a bachelor?s degree or higher jumped from under 14 percent to nearly 18 percent—a one-third increase. The figures for women are also positive: Less than 28 percent had a bachelor?s degree in 1992; over 32 percent did in 1998.

The fraction of 25- to 29-year-old women with some college grew from less than 58 percent in 1992 to more than 68 percent in 1998. African American women made especially impressive gains: While less than 47 percent had some college in 1992, nearly 60 percent had some college in 1998.

The number of women earning master?s degrees increased by 14 percent between 1992 and 1995, and women?s participation in professional and doctoral programs has also increased.^[39] Indeed, the educational attainment of women increased so much in the past decade that attainment rates for women now exceed those for men at every level of education.

Increasing enrollments and greater diversity in the Nation?s colleges and universities, even as the cost of higher education has gone up, reflect seven years of efforts by this Administration to make higher education more accessible and affordable for all students. Greater availability of need-based grants, low-interest student loans, and work-study and national service programs have opened the doors of higher education to millions of students who otherwise could not afford it. Since the average cost of attending a public four-year institution amounts to 60 percent of the average income of families in the bottom fifth of income,^[40] the record-setting percentage of low-income high school graduates enrolling in college is strong testimony that the Administration?s efforts are paying off.

HOPE TAX CREDIT
A family with one child studying at a community college with a tuition of $2,000 and another child studying at a private college with tuition of $11,000 could save $3,000 under the Hope tax credit.
LIFETIME LEARNING TAX CREDIT
An auto mechanic who takes night classes costing $1,200 at a local technical college could receive $240 in tax breaks to offset the tuition. A family with a junior at a four-year college costing $10,000 could save $1,000 on their taxes. Two years from now, when the tax credit is fully phased in, that family could save $2,000.

When President Clinton took office in 1993, the maximum Pell Grant was $2,300. Now, it is $3,300. Pell Grants this year amount to a $7.6 billion investment that will benefit over 3.8 million students. In addition, Federal work-study funds have increased 43 percent since 1993. This year, the $934 million in work-study funds will give one million students the opportunity to participate, over 250,000 more students than in 1993. Federal Supplemental Educational Opportunity Grants will provide $631 million in additional aid to over 1.1 million students. Since 1994, roughly 150,000 AmeriCorps participants have earned up to $4,725 for college while serving local communities.

As part of his goal to make two years of college as universal as high school, the President in 1997 signed into law the Hope tax credit, which offsets up to $1,500 of tuition and fees each year for low- and middle-income students during the first two years of college. Also in 1997, the President signed into law the Lifetime Learning tax credit, which provides a 20 percent credit against tuition and fees for college, graduate study, or job training worth up to $1,000 per family through 2002 and up to $2,000 thereafter. In 1998, these measures provided $3.5 billion in educational savings for 4.8 million families. The President has proposed expanding the Lifetime Learning tax credit to provide $30 billion in savings over 10 years.

The Information Age is truly the Education Age. That's why President Clinton and I have worked so hard to expand access to college for our young people and for adults who want to go back to school.

Vice President Gore
February 1998

Moreover, the Direct Lending Program and improvements to the student loan program have saved students over $8 billion on their loans during this Administration, while saving taxpayers over $5 billion. Due to a lower interest rate formula, students who took out student loans since 1993 will save $100 annually for each $10,000 in outstanding loans, for a total savings of $5 billion so far. By reducing loan origination fees in 1993, the Administration has saved students $3.7 billion to date. In 1999, the Administration reduced direct loan fees even further. By setting a higher standard in servicing loans, the Direct Lending Program infused competition into the student loan market, forcing long-time lenders to reevaluate and improve their practices. Direct Lending is substantially less expensive for taxpayers than the guaranteed loan program, and taxpayers have saved over $4 billion over the past five years. In addition, Federal subsidies for banks and guaranty agencies have been pared down, saving taxpayers an additional $1.6 billion over the past five years.

Defaults on student loans:
FY 1990		22.4 percent
FY 1997		8.8 percent
	__________
Collections on defaulted loans:
FY 1992		$1 billion
FY 1999		$3 billion

Sources: U.S. Department of Education, National Cohort Default Rates; Budget of the United States, Fiscal Years 1994, 2001.

Since 1993, students also have had more flexibility in managing their student loans. Income-contingent repayment allows borrowers to pay back their debt in accordance with their income, and after 25 years, any outstanding balance is forgiven. As a result of a strong economy and stronger management of the student loan program, default rates have gone down while collections on defaulted loans have gone up.

Finally, the Department has further expanded access and improved educational opportunity through the success of its Office for Civil Rights in negotiating partnership agreements with several State higher education systems to eliminate the vestiges of segregation in systems that were previously segregated by race. These agreements have strengthened both the higher education systems overall in those States and the educational programs of several historically black colleges and universities.

³⁸ Unless otherwise noted, the data come from The Condition of Education 1999, pp. 132, 140, 142, 152, 274-76.

³⁹ National Center for Education Statistics (1998), Digest of Education Statistics, Washington, D.C.: U.S. Department of Education, tbl. 244.

⁴⁰ The College Board (1999), Trends in College Pricing 1999, p. 15.
-###-

[7 Getting Students Ready for College]

[Conclusion]