“Student loan debt has now surpassed credit card debt for the first time ever,” President Barack Obama told the crowd gathered at the University of Michigan (U-M) on January 27. “In the coming decades 60 percent of new jobs will require more than a high school diploma. Higher education is not a luxury. It’s an economic imperative that every family in America should be able to afford.”
The day of the speech, the White House released a Fact Sheet detailing Obama’s plan to keep education costs down. The proposed plan includes punishing expensive universities that raise tuition by shifting $10 billion of funding toward colleges and universities that try to keep tuition affordable.
Another part of the proposal creates a Race to the Top competition with a $1 billion investment that will reward states willing to make it more affordable for students to get degrees by keeping tuition in check.
The president proposed another $55 million to enable colleges to boost productivity and quality on campuses. This could cover things like redesigning classes with improved technology. The Fact Sheet points out that this will include “Minority-Serving Institutions.”
Obama is also supporting the creation of a College Scorecard for all colleges and universities to help students choose the college that’s right for them.
He’s also helping students by proposing to keep interest on subsidized Stafford loans from doubling—from 3.4 percent to 6.8 percent.
The president praised U-M on its efforts to cut costs during his visit. He spoke to about 4,000 people at the Al Glick Field House. According to the college, the budget has been cut by $235 million thanks to lowered energy costs, better utilization of space, and employee cost-sharing in benefits.
“Higher education is not a luxury or a bonus, but a prerequisite to future success,” said DeAndree Watson, Central Student Government president, in remarks before Obama spoke. “If we didn’t live in a country that invested in higher education, I wouldn’t be here today.”
Read the full text of President Obama’s Blueprint for Keeping College Affordable and Within Reach for All Americans at WhiteHouse.gov.
Watch a clip from Obama’s speech at the University of Michigan below: