Chairman Klein, Ranking Member Miller and Members of the Committee:
Thank you for this opportunity to talk about President Obama's fiscal year 2013 budget for the Department of Education.
This budget request reflects President Obama's firm belief that our country has always done best when everyone gets a fair shot, everyone does their fair share, and everyone plays by the same rules.
Our budget reflects the Administration's dual commitment to reducing spending and becoming more efficient while investing to secure our future.
Investments in education are investments that strengthen our global economic competitiveness.
A recent survey by the Business Round Table's Education and the Workforce Committee, chaired by Exxon-Mobile Chairman & CEO Rex Tillison, found that half of all U.S. employers report a sizeable gap between their current needs and the skills of their employees.
According to the BRT, the U.S. ranks 52nd out of 139 countries on math and science education. If we can return America to a top-performing education nation by 2025, it would help produce a 5% GDP increase in the years that follow.
And as the Council on Foreign Relations Task Force on Education concluded last week, investments in education have a direct impact on our national security as well.
According to the task force co-chairs, former Secretary of State Condoleezza Rice, and former New York City Schools Chancellor Joel Kline:
"The State Department is struggling to recruit enough foreign language speakers...
...U.S. generals are cautioning that enlistees cannot read training manuals for sophisticated equipment...
...and a report from the twenty-eighth Airborne Corps in Iraq found that out of 250 intelligence personnel, fewer than five had the "aptitude to put pieces together to form a conclusion."
Few issues touch so many parts of our lives, and few investments are as important to our safety and well being as education.
Today, all across America, people are meeting the challenge of improving education in many different waysfrom creating high-quality early learning programs, to raising standards, improving teacher quality, and aggressively closing achievement gaps to increase high school and college completion.
While the federal government contributes less than 10 percent of K-12 funding nationally, our dollars play a critical role in promoting excellence and equity, protecting children at risk, and, more recently, supporting significant education reform at the state and local levels.
Our Administration has used competitive dollars to encourage state and local educators to think and act differently.
And through programs like Race to the Top, we've worked with governors and educators to jointly undertake bold systematic reforms.
As a result of Race to the Top, 46 states created comprehensive reform plans with buy-in from governors, legislators, local educators, union leaders, business leaders and parents.
For an investment of less than 1% of total education spending, we have seen more reform across the country in the last 3 years than we have seen in the previous decade.
Even before we spent a single dime of taxpayer money, 32 states changed over 100 laws and policies to improve the way children learn.
We've also seen the transformative impact of Race to the Top in communities across the country.
From Ohio, where funds have helped rural districts partner on principal and teacher training; to Tennessee where STEM coaches are helping to improve the skills of K-12 math and science teachers; And Georgia, where public-private partnerships have formed to prevent at-risk youth from dropping out of school.
Race to the Top is making a big difference in children's lives and transforming public education as we know it.
I'm happy to report that thanks to continued Congressional support for comprehensive education reform, we plan to use our FY12 Race to the Top funds for both a district level competition and another round of Early Learning Challenge grants.
We are still working out the details and look forward to updating the committee in the coming weeks with more information.
At their core, Race to the Top and other key reform programs are about spurring reform by rewarding success and giving flexible funding to implement good ideas.
Especially in a time of tight budgets, we need to make the most effective use of federal funds.
Formula funds alone won't drive the kind of transformational reform our education system needs. We need to combine a strong foundation of formula funding with targeted use of competitive grant funds.
While we have maintained strong and foundational formula programs to help low-income students like Title I, we are also leveraging those dollars with reform programs like our Promise Neighborhoods initiative.
Thanks to Congress, last year we were able to double funding for Promise Neighborhoods.
The growing income inequality in America over the past 30-years has led to historically high child poverty rates.
Close to one-fifth of America's children live in poverty, and in some states, poor children represent close to 50% of all public school students.
That's morally unacceptable and economically unsustainable.
Education is the great equalizer. If we ever hope to lift our children out of poverty, we must give them access to effective schools and strong systems of family and community support.
We think Promise Neighborhoods can help break the cycle of poverty, and I really appreciate your support for this initiative.
Moving on to ESEA, the Administration remains committed to working with you on producing a comprehensive bi-partisan reform bill for the President to sign into law.
But while you continue your important work towards that goal, state and local school districts are buckling under the law's goals and mandates.
Despite our shared sentiment for reform and our long-standing work together to reshape No Child Left Behind, the law remains in place five years after it was due for reauthorization.
Our children only get one shot at a world-class education and they cannot wait any longer for reform. That's why we have offered states regulatory relief from NCLB in exchange for reforms that drive student achievement.
Working closely with Independent, Democratic and Republican Governors, we have helped unleash energy at the local level as Congress works to rewrite the law, by giving states, districts and schools the flexibility they need to raise standards, support teachers, and improve our lowest-performing schools.
Mr. Chairman, in your home state, Governor Mark Dayton said, "This waiver will allow Minnesota administrators, teachers and parents to work together in building a new system of accountability for our schools, which will lead to better education for our children and a better future for Minnesota."
In Tennessee, home to two members of this committee, Governor Bill Haslam has said that flexibility offered by the Administration from ESEA will help improve education for all of Tennessee's students
And in Indiana, state education officials have said that the Administration is providing the regulatory flexibility Indiana needs to drive student achievement.
The chorus of support for relief from the law is strong and widespread. So far, 37 states and the District of Columbia have applied for flexibility with more on the way.
Eleven of those states have been given flexibility and we will continue working with all states to give them the freedom to implement locally developed reforms that will protect children and improve student achievement.
We also recognize that Congress faced some difficult choices with respect to the Pell Grant program. But we appreciate that the maximum Pell Grant award was maintained at its current level, which will help close to 10 million students across the country pursue higher education in the 2012-13 school year.
Before I give you an overview of our budget request for next year, I'd like to take a moment to address an issue that could threaten our ability to prepare American students to compete in the global economy and undermine our national security.
As you know, last week Congressman Ryan, whose leadership I respect, unveiled an alternative budget plan, which you may soon be considering here in the House.
However well intentioned, the Ryan plan draws on the same flawed theory that led to the worst recession in our lifetime and contributed to the erosion of middle-class security over the last decade.
And it does so by, among other things, balancing the budget on the backs of America's students.
If the Ryan budget is voted into law, we could see disastrous consequences for America's children over the next couple of years.
By 2014, Title I, which helps fund educational programs and resources for millions of low-income minority, rural, and tribal children, could see a $2.7 billion reduction that might deny resources to over 9,000 schools serving more than 3.8 million students.
Money needed to help pay teachers, tutors, and funds for critical after school programs might no longer be there and as many as 38,000 teachers and aids could lose their jobs.
Funding to help educate students with disabilities could be cut by over $2.2 billion, which would translate to the loss of over 30,000 special education teachers, aids and other staff.
200,000 children could lose access to head start.
Work-study funding could be cut by $185 million potentially denying a meaningful path to make college more affordable for up to 129,000 low-income students.
And TRIO, which helps prepare low-income and minority students to succeed in college, could be cut by $159 million leaving 148,000 students in the lurch.
The Ryan budget could also cut $3 billion from the Pell grant program, completely eliminating aid for 400,000 low-income college students and reducing assistance for close to 9 million more.
And that is just the tip of the iceberg.
In short, passage of the Ryan budget would propel the educational success of this country backwards for years to come and that is a risk we cannot afford to take.
Likewise, we cannot afford for the disastrous across the board cuts, known as budget sequestration, to take effect next year.
We must come together as a country to make sound, bipartisan investments in education.
It is unconscionable for us to ask a generation of students to pay the price for adult political dysfunction. And I am asking for your help to make sure that doesn't happen.
As I travel the country I hear a deep appreciation for the federal commitment to children and learning. Americans know thateven in challenging fiscal times like thesewe must educate our way to a better economy.
They know thateven as states face greater financial pressure than at any time in recent historywe cannot put our children at riskso our budget reflects these aspirations and commitments.
That's why we are requesting $69.8 billion in discretionary funding for 2013, an increase of $1.7 billion from 2012.
Our proposal seeks to direct funding to four key areas: supporting state and local reform in P-12 education; elevating the teaching profession; strengthening the connections between school and work; and making college more affordable, which would see the largest share of our requested increase.
Fifty years ago, college was a luxury. Back then, you could still graduate from high school and get a good paying job that would guarantee you a place in the middle class. Those days are gone.
A postsecondary education is the ticket to economic success in America. We know that the jobs of the future will all require some kind of education or training after high school.
And while it's never been more important to have a degree, a certificate or an industry recognized credentialit's also never been more expensive.
Since 1995, college costs across the country have risen almost 5 times faster than median household income.
As a result, students and their families are taking on more and more debt. Borrowing to pay for college used to be the exception, now it's the rule.
What's troubling is that not only are more students borrowing; but they are borrowing more.
We all have a role to play in making college affordable and keeping the middle class dream alive. It's a shared responsibility.
We need states to continue to invest in postsecondary education and training.
We need institutions to do a better job of delivering high quality instruction at an affordable price to students of all backgrounds.
And we need to arm parents and students with the consumer information they need to make smart educational choices.
President Obama believes that the federal government has an important role to play as well.
That's why we are providing billions of dollars a year in aid to needy students through Pell grants.
We're also helping students to better manage their debt after graduation with programs like income based repayment and public service loan forgiveness.
While all of these efforts help struggling students access and afford college, they alone are not enough.
That's why the Administration is proposing several new reforms to contain rising college costs.
Double the number of work-study jobs within five years; Make the American Opportunity Tax Credit permanent; And provide new incentives for states and institutions to keep college costs from escalating.
The President's budget would also continue support for key programs supporting college access and completion for minority and disadvantaged students, like TRIO, GEAR UP and Impact Aid.
And President Obama's education budget will prevent student loan interest rates from doubling this summer;
As many of you here know, unless some action is taken, Congress has mandated that subsidized student loan interest rates will double starting in July of this year.
With so many students struggling to both make ends meet and afford the skyrocketing cost of college, now is not the right time to heap more costs on top of them.
If Congress doesn't act soon, over 200,000 students in Minnesota will see their student loan interest rates double, as will half a million students in California and over 7.4 million students nation-wide.
We must act soon and both the President and I stand ready to work with you to help solve this problem for America's students.
In addition to making college more affordable for millions of Americans, our budget proposal will continue foundational investments in critical formula programs like Title 1 and IDEA as well as successful incentive-based reform programs at the P-12 level like Race to the Top, Promise Neighborhoods, and i3.
Our proposal would also dedicate significant resources to transforming the teaching profession through a new program called RESPECT.
That acronym stands for Recognizing Educational Success, Professional Excellence, and Collaborative Teaching.
Our goal is to work with educators in rebuilding the professionand to elevate the teacher voice in shaping federal, state, and local education policy.
Our larger goal is to make teaching among America's most important and respected professions. That is a lofty goaland we are serious about getting there.
If we're going to educate our way to a better economy, we have to address the growing skills gap in America.
There are 2 million jobs unfilled today because employers cannot find workers with the right skills, preparation and training.
That's why the President's budget includes key investments to help build partnerships between community colleges and local businesses so that they are training workers for the jobs employer's need to fill now and in the future.
And finally, we're proposing increased investments in career academies, which have been shown to reduce high school dropout rates and prepare students for careers that lead to higher earnings.
Our job is to support change with transparency, with the right incentives, and we believe our budget proposal does just that.
The President believes this is a make or break moment for the middle class and those working to reach it.
What's at stake is the very survival of the basic American promise that if you work hard, you can do well enough to raise a family, own a home, and put enough away for retirement.
The defining issue of our time is how to keep that promise alive.
No challenge is more urgent; no debate is more important.
We can either settle for a country where a shrinking number of people do really well, while more Americans barely get by. Or we can build a nation where everyone gets a fair shot, everyone does their fair share, and everyone plays by the same rules.
At stake right now are not Democratic or Republican values, but American valuesand for the sake of our future, we have to reclaim them.
At the heart of that effort is support for education.
Thank you. I would be happy to answer any questions you may have.