Obama's Budget Delivers on Education

Teacher Performance
Research has shown that the teacher quality has a huge impact on student achievement. “You can have the best accountability system in the world, but if you don’t have good teachers in the classroom none of that is going to matter,” Carey says.

As a way of putting effective educators in front of classrooms, this budget would provide incentives for teacher performance and rewards for teacher success—a highly contentious issue for many teachers unions who believe that such a payment system would be unfair and unruly.

“This shows Obama’s willingness to engage on some politically controversial issues,” Carey says. Indeed, the budget did not shy away from this issue, stating that there would be money to support efforts by states “to implement systems that reward strong teacher performance and help less effective teachers improve, or, if they do not improve, exit the classroom.”

Carey points out that these systems would not be imposed from Washington, but would be determined on a local-level. Most likely, Carey says, the Department of Education will give competitive grants to districts that are willing to work with teachers to lay out parameters for incentives.

Higher Education
Data from the Student Right-to-Know Act shows that less than 40 percent of students earn their degrees in four years from a typical institution—a fact that Obama hopes to turn around, with a goal to regain our position as the country which graduates the highest number of students by 2020. “He put a marker down that he was going to focus on that,” Carey notes.

In his address to Congress, Obama implored every American to strive for one year or more of higher education or career trade. “Whatever the training may be every American will need to get more than a high school diploma,” he said.

The budget plan would ensure every American is able to do that in three ways:

• Modernizing the federal student loan program. This effort would guarantee student access to loans by asking Congress to end the entitlements given to financial institutions, which are subject to turmoil in the financial markets, and instead take advantage of stable, low-cost sources of capital through competitive, private providers. According to the Department of Education, this would save more than $4 billion a year that would be recycled back into aid for students. There would also be more campus-based, low-interest loans available through an overhaul of the Perkins program. The revamped Perkins program would provide $6 billion in loans every year, a significant increase from the current $1 billion in funding. Funds would be distributed to schools that provide more need-based aid to students and that maintain reasonable student costs relative to other schools in their sector. This is vastly different from the current system, which uses antiquated formulas that ultimately favor schools that increase college tuition.
• Increasing Pell Awards. This builds on the Recovery Act money by supporting a $5,500 Pell Grant maximum award in the 2010-2011 school year. Pell Grants would be made mandatory under this budget, and would be set to keep pace with inflation.
• Improving college completion rates. The budget would commit to giving $500 million a year for five years towards the Access and Completion Incentive Fund to support efforts by colleges and universities to keep kids in school. Essentially the fund would work as a federal-state-local partnership with the goal of improving graduation rates, especially for low-income college students.

This big push for higher education is part of the emerging theme of the new Department of Education: preparing students for a global economy. “America's students and workers need a higher level of education and training," U.S. Secretary of Education Arne Duncan says. "President Obama's proposed budget calls for a historic investment to make college more affordable and accessible and to help more students succeed once they get there."

With this budget announcement, the new administration promises to find out, and fund, what’s working to help students learn, and to diagnose and eradicate the root problems in the education system.

This budget is by no means set in stone. Further details, including more specific numbers, will be released in late April, and Congress will get on board for the long journey towards approval by the time the fiscal year begins in October.