College affordability

When considering education policy, we face a dilemma regarding affordability. Many of us believe that it’s important to make college accessible to all people who are qualified to be admitted to a university. This is critical for growing or even maintaining the middle class in this country. Thus we have programs like grants and student loans.

Yet the availability of these funds provides little incentive for colleges to control costs. Over the years, college costs have skyrocketed as has student debt.

Some conservatives might argue that we shouldn’t be subsidizing college at all, but few agree with this line of thinking. America became great in large part due to our massive investments in higher education. The GI Bill helped to fuel the massive growth of the middle class following WWII.

So we need to continue to promote college education and help poor and middle class kids with affordability, but we need to inject some common sense controls into the system as well.

The Obama Administration is trying to address the problem, using some of the same incentives that were used to spur reform and innovation with their Race to the Top program for K-12 school systems.

President Obama is proposing a financial aid overhaul that for the first time would tie colleges’ eligibility for campus-based aid programs — Perkins loans, work-study jobs and supplemental grants for low-income students — to the institutions’ success in improving affordability and value for students, administration officials said.

Under the plan, which the president is expected to outline on Friday morning in a speech at the University of Michigan, the amount available for Perkins loans would grow to $8 billion, from the current $1 billion. The president also wants to create a $1 billion grant competition, along the lines of the Race for the Top program for elementary and secondary education, to reward states that take action to keep college costs down, and a separate $55 million competition for individual colleges to increase their value and efficiency.

The administration also wants to give families clearer information about costs and quality, by requiring colleges and universities to offer a “shopping sheet” that makes it easier to compare financial aid packages and — for the first time — compiling post-graduate earning and employment information to give students a better sense of what awaits them.

Many universities won’t be happy about this, particularly at a time when states are cutting back on education budgets. Yet the slavish devotion to more buildings and other expenses needs to stop. Having incentives to provide real value to students will change the calculation for university presidents and trustees.

Also, the notion of a shopping sheet is very important, as many college kids and their parents are clueless about the notion of costs vs benefits. There’s nothing wrong with a liberal arts degree, particularly if you have thoughts of going to grad school, but leaving undergrad with $120,000 worth of debt for an English degree is economic suicide. If kids start seeing the real costs as they vary from school to school, they will be more inclined to consider cost as a part of their decision on where to go to school. This of course is part of a larger problem where most Americans have very poor financial literacy, so these types of comparisons will encourage them to consider costs by giving them tools to make easy comparisons. As a part of that, college students will then be more likely to at least consider the economic value of their college major as well.

Given the current political environment, I won’t hold my breath on seeing the Republicans work with President Obama on any topic, even something like this that should be supported by both parties. Conservatives and liberals can argue about the size of government, both both should be working tirelessly to make government and its programs work better.

The wildly successful auto industry bailout

Chrysler announced today that it is repaying $7.5 billion to the U.S. government years ahead of schedule. Meanwhile, GM has announced it will hire thousands of new workers in the U.S. after a successful IPO.

The bailout of the U.S. auto industry in 2009 by the Obama administration was very unpopular, but it will go down as one of the shrewdest decisions of President Obama. Letting GM and Chrysler go through a bankruptcy liquidation would have killed thousands of jobs and possibly turned the recession into a depression. Thousands of auto suppliers would have been insolvent immediately, thus creating even more job losses.

Most on the right, including presidential candidates Tim Pawlenty and Mitt Romney, opposed bailing out the auto companies. Mitt Romney even penned an op-ed arguing that we should let Detroit go bankrupt. They look like fools now, and the Democrats just released a preview of how this issue will be highlighted in the 2012 campaign, particularly in the Midwest.

Political malpractice

Tim Kaine, Chairman of the Democratic National Committee, speaks during their summer meeting in St. Louis on August 20, 2010. St. Louis is in the running for the 2012 Democratic Presidential Convention. UPI/Bill Greenblatt

The issue of Senate recruitment is in the news again, as Jim Webb decides to retire and the Democrats are now praying that Tim Kaine will enter the race for Senate in Virginia. We’ll see if President Obama can convince him, but as Ezra Klein points out, this administration has been very bad in the area of Senate recruitments.

But the White House hasn’t always taken the recruitment of challengers that seriously. In 2008, they brought Iowa’s Tom Vilsack, Arizona’s Janet Napolitano, Kansas’s Kathleen Sebelius, and Colorado’s Ken Salazar into the administration. The payoff? They almost lost Salazar’s Senate seat and Democrats had to find weaker candidates in Iowa, Arizona, and Kansas. It stands, to me, as the administration’s single most baffling set of political decisions. There were plenty of other people capable of running the various cabinet agencies. There were no other people capable of replacing the threat Vilsack would have posed to Chuck Grassley or that Napolitano would’ve posed to John McCain, and thus no one who could’ve done as much to convince them that cooperating a bit on initiatives like health-care reform would be in their interest. Similarly, Sebelius was the only Democrat in Kansas who even had a chance of winning the state’s open Senate seat. Why pull her to Washington in a different capacity?

I think the Obama administration has been unfairly attcked by many on the left, but when it comes to politics after the 2008 election, this administration clearly made some huge mistakes. It’s stunning when one considers that Rham Emanuel was helping to run things.

Frankly, I think the Obama team got way overconfident in the political situation immediately after the 2008 election. They knew they had tough fights ahead, but they had such big majorities they probably felt they didn’t have to worry to much about a handful of Senate seats.

That proved to be a disaster. McCain would have been vulnerable against Napolitano, particularly after he swung way to the right in the primary. Grassley was also vulnerable in Iowa. They plucked some of their best candidates, and none of them are critical in their current roles.

Hopefully they have learned their lesson and they will push Kaine hard to run in Virginia.

The unbearable lightness of Peggy Noonan

I enjoy reading Peggy Noonan because she’s never shy about her point of view. She also writes beautifully.

That said, for every great column, she produces at least two clunkers. Today’s column, with the subtitle of “The unbearable lightness of Obama’s administration,” is particularly bizarre. Here’s the introduction.

He is willowy when people yearn for solid, reed-like where they hope for substantial, a bright older brother when they want Papa, cool where they probably prefer warmth. All of which may or may not hurt Barack Obama in time. Lincoln was rawboned, prone to the blues and freakishly tall, with a new-grown beard that refused to become an assertion and remained, for four years, a mere and constant follicular attempt. And he did OK.

Such impressions—coolness, slightness—can come to matter only if they capture or express some larger or more meaningful truth. At the moment they connect, for me, to something insubstantial and weightless in the administration’s economic pronouncements and policies. The president seems everywhere and nowhere, not fully focused on the matters at hand. He’s trying to keep up with the news cycle with less and less to say. “I am angry” about AIG’s bonuses. The administration seems buffeted, ad hoc. Policy seems makeshift, provisional. James K. Galbraith captures some of this in The Washington Monthly: “The president has an economic program. But there is, so far, no clear statement of the thinking behind the program.”

What a jumbled mess. She sounds like all those journalists who were lecturing Obama early in the campaign that he had no chance of winning if he stayed calm and refused to go negative on Hillary.

She asserts there’s “something insubstantial and weightless in the administration’s economic pronouncements and policies,” when liberals and conservatives recognize that Barack Obama has proposed the most daring and ambitious budget of our generation. Conservatives hate the budget for that very reason – Obama wants to fundamentally change how we meet the challenges of health care, energy and education. Somehow, Peggy Noonan has missed all that, getting distracted by the daily Washington soap opera that plays out on cable TV.

Barack Obama is trying to put out a bonfire cause by years of irresponsible behavior in Washington and on Wall Street. His critics are howling that he hasn’t snapped his fingers and slayed this economic monster with a silver bullet. The bottom line is this – Obama and Bernanke have put together a sensible package of programs that just might get us out of this mess. Of course, Ms. Noonan has nothing to say about the actual substance.

She isn’t comfortable with Obama’s style, probably because she’s been in Washington so long she can’t process anything other than the scripted nonsense of previous administrations. She shouldn’t confuse message discipline with sound policy. Obama is selling his policies on his terms, and he refuses to treat the American people like idiots. Critics might quip that he comes across as “professorial,” but many Americans appreciate a President who doesn’t try to turn every policy proposal into a dumbed-down soundbite.

Gates and Obama getting ready for big cuts in weapons systems

News about the Obama administrations plans for cuts in weapons systems is starting to leak out.

Two defense officials who were not authorized to speak publicly said Gates will announce up to a half-dozen major weapons cancellations later this month. Candidates include a new Navy destroyer, the Air Force’s F-22 fighter jet, and Army ground-combat vehicles, the officials said.

More cuts are planned for later this year after a review that could lead to reductions in programs such as aircraft carriers and nuclear arms, the officials said.

As a former CIA director with strong Republican credentials, Gates is prepared to use his credibility to help Obama overcome the expected outcry from conservatives. And after a lifetime in the national security arena, working in eight administrations, the 65-year-old Gates is also ready to counter the defense companies and throngs of retired generals and other lobbyists who are gearing up to protect their pet projects.

“He has earned a great deal of credibility over the past two years, both inside and outside the Pentagon, and now he is prepared to use it to lead the department in a new direction and bring about the changes he believes are necessary to protect the nation’s security,” said Geoff Morrell, the Pentagon press secretary.

Gates is not the first secretary to try to change military priorities. His predecessor, Donald H. Rumsfeld, sought to retool the military but succeeded in cancelling only one major project, an Army artillery system.

Former vice president Dick Cheney’s efforts as defense chief under the first President Bush, meanwhile, are cited as a case study in the resistance of the military, defense industry, and Capitol Hill. Cheney canceled the Marine Corps’ troubled V-22 Osprey aircraft not once, but four times, only to see Congress reverse the decision.

The article highlights the difficulties Gates and Obama will face as they try to cancel these unnecessary and ridiculously expensive programs. This time we’re in the middle of a financial crisis, and Republicans have been howling about spending, so now Obama will be able to turn the tables on them.

Here’s more information on the F-22.

Gates’ first showdown looms with a $350 million–a–pop fighter jet. He has to decide by March 1 whether to add more F-22 Raptor fighters to the 183 purchased by the Bush Administration. For years, the Air Force has wanted to double the fleet, while Gates has made clear that he thinks 183 is sufficient. A month ago, some Air Force officials were saying privately that maybe 60 more F-22s would suffice. The Pentagon’s acquisition boss, John Young, recently detailed why more F-22s might be a poor investment. The F-22s that exist are ready to fly only 62% of the time and haven’t met most of their performance goals. “The airplane is proving very expensive to operate, not seeing the mission-capable rates we expected, and it’s complex to maintain,” Young said. Besides, he added, the Air Force plans on spending $8 billion to upgrade most of the F-22s it already has.

We can’t afford to spend more money here.

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