President Obama is expected to propose a roughly $300 billion job creation package in a televised speech before a joint session of Congress tonight, and the initiatives he announces will be designed to boost consumer demand in an attempt to bring down the nation's persistently high unemployment rate. The president's message is not the only one that is relevant to U.S. economic improvement, however.
Indeed, in a comparatively modest speech at the Miller Center of Public Affairs yesterday, University President Teresa A. Sullivan argued "higher education serves as the engine, or driver, of the American economy." This point is crucial to remember at a time when most attention is focused on policies such as tax cuts and stimulus spending rather than research grants and tuition assistance. Although stimulative fiscal policy may provide a much-needed short-term boost to the economy, politicians should not overlook the role of higher education funding in spurring long-term economic growth. Unfortunately, present federal policies are restraining rather than unleashing the power of U.S. higher education, and it is imperative that changes be made so the nation can get the most out of its immensely valuable network of colleges and universities.
There are two primary ways the government can ensure U.S. higher education lives up to its potential. The first is by expanding access to colleges and universities so they serve as many individuals as possible. This could be accomplished by increasing federal financial aid for low-income students, who remain grossly underrepresented at the nation's premier schools.
In recent months, however, Congressional Republicans have attempted to do the exact opposite by threatening repeatedly to cut Pell Grants, which are the main source of federal financial aid to low-income students. Thus far, Pell Grants largely have been spared but the reality is that the only way more students can obtain a college education at a time when tuition increases are outpacing inflation is through a corresponding rise in the amount of financial aid that is available. Although institution-specific programs such as AccessUVa are attempting to fill in the gap, even they leave middle-income students vulnerable since only individuals from very poor families qualify for aid in the form of grants.
The federal government also can enlarge the pool of individuals attending U.S. colleges and universities by liberalizing the nation's stringent and inefficient immigration laws. In particular, it should simplify the complex visa application process that has contributed to a decline in the overall share of international students attending U.S. colleges and universities.
New immigration programs also should be implemented that would allow non-citizen college graduates to remain in the U.S. This would increase the number of high-skill workers in the country as well as the number of students paying out-of-state tuition at public colleges and universities, and it would generate additional tax revenue for the federal government. In the long run, it also would stimulate the economy by creating more entrepreneurs and innovators whose businesses and scientific discoveries could enhance the nation's quality of life.
Beyond simply growing the pool of individuals who can access the educational offerings of U.S. colleges and universities, the federal government also must dedicate sufficient resources toward maintaining those institutions' quality. As Sullivan noted in her speech, however, the nation has been moving backward in this respect as well. "According to the federal agencies that provide the funding, total federal obligations for academic R&D [research and development] peaked in 2004 at $22.1 billion, and declined by almost 7 percent, to an estimated $20.7 billion by fiscal year 2009," she said. Moreover, she cited a recent Chronicle of Higher Education survey of 500 chief financial officers at U.S. colleges and universities that found cuts in state support to be "far and away the most worrisome factor facing their institutions." Rather than pulling the rug out from under the core operations of U.S. institutions of higher education, policymakers should be redoubling funding for research grants and devising new ways to catalyze partnerships between public universities and private businesses.
It is unlikely that any of these ideas will make their way into Obama's speech this evening, but they nevertheless are the best options for strengthening the U.S. economy's future outlook. If moderate voices such as Sullivan who recognize this fact are to prevail, however, it may first be necessary for short-term economic programs to succeed in creating a calmer political environment in which politicians can rationally consider the federal government's role in supporting higher education.
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