Remarks to the American Association of Community Colleges in Minneapolis, Minnesota

Weekly Compilation of Presidential Documents, May 1, 1995

Well, the direct loan program addresses all those problems. It lowers costs for students. It allows borrowers to choose flexible repayment arrangements, including a pay-as-you-earn option. Therefore, it doesn't doom anyone to a crushing debt burden. It's also, believe it or not, helping us to save billions of dollars of taxpayers' money. That, plus Secretary Riley's more vigilant enforcement of the loan program, have cut your losses as taxpayers from $2.8 billion a year to $1 billion a year, a reduction of almost two-thirds.

But get this - what are we going to do now? In the first year, we had 104 schools with over 252,000 students in the program. In the second year, we'll have more than 1,400 schools representing 37 percent of all loans committed to enrolling. Today I am proud to announce that in our third year, beginning July 1996, 450 new schools will join the program which will mean 45 percent of all student loans will be administered through this program.

Now, that's the good news. You don't have to take my word for it. You can look at the students that I just mentioned, Jessica Aviles or Sandra Tinsely, they're both here. Go ask them about it. Listen to them talk about how much quicker they got the loan and what a joy it was not to have to go through the hassle and the delay and the uncertainty.

But here's the good news. If we keep going until we make the student loan program available to all the schools on a voluntary basis, it will save the taxpayers $12 billion over 5 years or about the same amount of money that would be saved if we started charging interest on student loans while the students are in college.

So if we want to reduce the deficit, let's reduce the deficit by increasing education, not by reducing it. That's the message that I want you to take out there.

The second thing I want to say to you is that we have a lot of Americans who are unemployed or underemployed who want more training and education. And a lot of them now only have access to certain highly specified and difficult-to-understand and access Government programs. There are dozens of Federal training programs, most of them enacted with the best of intention by Congress.

What we proposed to do is to put the American people who need training in control of their own destiny with these programs, instead of just shifting the power from a Federal bureaucracy even to a State one. What we propose to do is to consolidate all these training programs and create a skill grant, essentially a training voucher to people who are unemployed or underemployed or qualified for Federal help, let them get the voucher, and take it to their local community college and have access to the programs you offer for up to 2 years to get the training necessary for the future.

That is a much better expenditure of that money than to continue in these programs which may or may not be easily accessible and which require a whole lot of paperwork and are very confusing. We want to consolidate the money, give it directly to the people who are entitled to it in the form of a voucher, and let them take it to you to get the education you need. I hope you will help us pass that as well in this Congress.