Obama Takes New College Affordability Plan On The Road

The president unveiled new government rating system for colleges, judged on affordability.
26:16 | 08/22/13

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Transcript for Obama Takes New College Affordability Plan On The Road
And good news. -- did it. Familiar a big round of applause. The millions of fans -- probably you're familiar -- friends wetlands. -- -- With a run in. My -- a run for something. -- in addition end -- -- I want out. Mention other a couple -- -- you. Yarder from secretary of education Arnie Duncan who's doing a great job every day. -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- The superintendent of the CNET news. City school district -- but twelfth -- The -- the -- rubble of the Clinton. Most importantly a bunch of students -- here. My understanding is -- -- from -- five -- -- schools here. -- The. The Institute of Technology. This didn't lose it. It. Hello World -- all want them. Especially want to thank the students because. I know you're still on summer vacation. You got a few more days. So also taken without a beard. When you've still got a little bit that last little -- summer break that's a big deal. And I'm very honored to be here when it. I am on a road trip. By the way people have -- -- -- -- -- government on. Have you got no sleep spindles stood up. February pulled up. -- -- -- Through New York. Into Pennsylvania. This morning I was at the university of buffalo. Albeit. Binghamton university and lackawanna college and -- But I want to come the searchers. Because you don't something fantastic here with programs like say yes. Smart scholars early college -- school. -- programs that are helping Syracuse kids get ready for college. And making sure that they can afford to go. And as a community up. All of your coming together and you have declared that no child in the city of Syracuse. Should miss out on a college education because the campaign report. -- -- We're open more cities follow your example because what you're doing it is critical not just to -- -- future but America's future. And that's what I want talk about briefly here today. Over the past month I've been visiting. Towns across the country talking about what we need to do. To secure a better bargain for the middle class and everybody who's working hard to get into the middle class. To make sure everybody. Who works are have a chance to succeed in point -- -- cop. And we don't understand the -- -- the passport happy years we had to fight our way back from brutal recession. And millions of Americans lost their jobs their homes their savings but what the recession also bared was it showed. This emerging gap. In terms. But -- prospects of a lot of Americans. You know what used to be taken for granted middle class security it. Has slipped away from -- many people. So yes we save the auto industry we took on a broken health care system. -- First our addiction to foreign oil we changed our tax coat that was tilted too far in favor of the wealthy at the expense of working families. And so we've made progress our businesses have created seven point three million new jobs over the last 41 months. More renewable energy than ever we are importing less -- -- a very long time we sell more goods made America the rest of the world than ever before. Health care costs are growing at the slowest rate in fifty years our deficits are calling it the fastest rate in sixty years. So there's good news out there thanks to the grip and the resilience of the American people. We've been able to clear away the rubble of the financial crisis and start laying the foundation for. A better economy. But. Has. Had any middle class family will tell you. We are not. I hear it. I got to. Not all of those -- -- -- It's good I don't know -- -- -- Let alone. Although the -- Although the minister. -- So. You know. -- -- Can I cannot. I -- As hecklers go back -- was very polite. She -- and you know she brought up. An issue of importance and that's part of what America's all about. So we don't want to. But what. Americans also all about -- made sure the middle class families succeed. And the people who work hard can get in the middle class. What analysts -- it was is that we're not where we need to be yet. We still got more work to note. Because even the -- The most recent financial crisis. We have gone through a decade. Where folks at the top were doing better and better. Most families were working harder and harder just to get -- And we've seen growing inequality. In our society. And less upward mobility. In -- side. The idea used to being. -- here in America anybody can make it. Part of that was because we put these ladders of opportunity for hate. And unfortunately what happened. It's gotten -- -- up. So we've got to reverse. These trends. This has to be Washington's -- prior art how we make sure everybody gets a fair shake. Unfortunately. You may have noticed that in Washington. Rather than focusing on growing economy. And create good middle class jobs. There's a certain faction of my good friends and the other party. -- been talking about not paying the bills but -- RD run up. We've been talking about shutting down the government if they can't take away health care. We're putting in place for millions of Americans. Those are not ideas that -- grow our economy they're not gonna create good jobs. They're -- strength in the middle class the week in the middle class so we can't help -- the usual Washington circles. Of distractions and political posturing we we don't need that. What we've got to do is to build on. The cornerstones of what it means to be middle class in America a good job good wages a good education. Home. A quick -- retirement. That's what we need to focus on. And we got to we've got to create as many pathways as possible for people to succeed. As long as -- -- the -- are. That's what's always made America great. We don't judge ourselves by how many billionaires we produce. We got to focus on our building to make sure that everybody who works of art had the chance to pursue -- -- measuring happiness. An -- in that. Project in that work. There aren't a lot of things that are more important. Than making sure. People get a good education. That is key to upward mobility that is. To a growing economy that is key to a strong middle class. What -- you back. Yeah. Everybody here knows that. That's why you're here. That's why a lot of your families are making big sacrifices -- to send kids to college you understand that in the pace of global competition. A great education is more important than ever. -- higher education is the single best investment you can make in your future. Single best. I'm proud of all the -- or working toward that goal. An ad in case any of -- -- wondering whether it's a good investment. Think about these statistics the unemployment rate for Americans -- at least a college degree. Is about a third lower than the national average. The incomes. People whip at least a -- degree are more than twice. What being -- are Americans who don't have high school diploma. So more than ever before some form -- higher education to your warrior technical college. That's the path into the middle class. The main reason I'm here is to talk about the fact that. We've seen a bear. -- a burden to too many American families and that's. The soaring cost of higher education. The fact it is college. Have never been more -- necessary but it's also never been more expensive. Think about this over the past three decades the average tuition. At 84 year public college has risen by more than 21 and 50%. The typical family income. Has gone up 16%. So I wasn't a math major but -- to think about. College golf's 250%. In comes. 16%. What that means business met. More and more it's getting harder and harder. For students to be able to afford college education and families -- making bigger and bigger sacrifices. Including a lot of parents were put off their own retirement. -- savings. Because of trying to help their kids afford a college education. In the meantime over the past few years you've got too many states that have been cutting back on their higher education budgets. Colleges have not been cutting back on their costs. And so what you end up -- -- taxpayers put -- more money. Students and families picking up the -- but. Young people are still -- up with more -- The average student who borrows for college now graduates owing more than 26. Thousand dollars. And a lot of young people are more than that. I've heard from all these young people when they're frustrated because they're saying to themselves we've done everything. Our society told us -- supposed to do. But crushing debt is crippling. Our ability to get started in -- -- that we gradually. It's crippling our our self reliance and -- and the dreams that we get. At a time when higher -- never been more important or more expensive. Too many students face a choice they should not have to make either they signaled a college. -- -- -- -- -- -- going to college and ending up with -- that they're not sure won't pay off. And that's not a choice that we should ask. Young people to make that's not a choice we should accept. Don't if if you think about what built this country -- country that's always. Been at the cutting edge of making a good education available to more people. My grandfather when he came back from World War II. He went he had the chance to go to college on the GI but. My mother. Got through school while raising two kids because. She got some help. Michelle. Michelle and I wouldn't come from. You know. Rich -- -- -- we've we've that we did not come from privileged backgrounds. So were only where we are today because scholarships and student loans -- as a -- of the good education. And we know a little bit about paying -- loans. Because. We -- graduated. From college -- law school with a mountain of debt and even with good jobs. And pay it off and she -- pay off her loans. Until I was almost US. I was in my forties. Soul. So over the past four years what we've done is to try to take some steps to make college more -- First thing we did we enacted historic reforms to the student loan system. What was happening student loans were going to banks banks were making billions of dollars. We said -- does give loans directly to students cut out the banks then we can help more students. -- we set up a consumer watchdog. That's already helping families and students sort through all the financial options -- they really understand them and they're not ripped off by shady lenders. And were provided more tools and resources for students and families trying to finance college and by the way. High school seniors -- want to start. Figure in the stuff about go to -- to -- -- god gut that's website student -- not go up and I'll give you a sense of what's available out there. We took action to cap. Loan repayments at 10% of monthly income for a lot of borrowers were trying to -- their -- but do so in a responsible way. So overall we made college more affordable for millions of students. And families through tax credits and grants and student loans. And just few weeks ago Democrats and Republicans work together to keep student loan rates from double. And that saves a typical undergraduate more than 15100 dollars to this year's long. So. It's -- good start. But it's not enough. The system we have right now is unsustainable. Because it keeps on going up 250%. A year -- gums are only gone up 16%. Not a -- -- -- on a year over a decade we're hearing comes only grown up 16%. It's just at a certain point. -- break the back. There won't be enough federal aid to make up for the difference. And families deserve what aren't real but advocates to school. And and and state legislatures they can't just keep cutting support for public colleges and universities. Colleges can't just keep on raising tuition year after year and pushing. These state cutbacks on students and families and federal taxpayers is -- -- to mail to make -- all the difference. Our economy can't afford the trillion dollars one trillion dollars in outstanding student loan debt. Because when young people have that much -- that means there they can't buy a home. It means. They can't start the business but maybe they've got a great idea for. And we can't write the middle class and everybody working to -- in the middle class out of a college education. It'll put our young generation of workers. Had a competitive disadvantage for years. -- higher education is still the best ticket to upward mobility in America and it is. And we've got to make sure it's within reach. We've got to make sure that we are improving economic mobility not make it worse. Higher education should not being walked -- It is a necessity and economic imperative that every family in America should be -- -- -- so. So -- we're gonna do about today what I've done is propose. Major new reforms that'll shake up the current system. We want to create better incentives for colleges to do more with less. And to deliver better value for our students and their families. And some of his reforms will require action from congress which is always. Difficult. Some of these changes though I can make a mile. And we want to work we want to work with colleges to keep costs down. States are gonna need to make a higher education a higher priority in the budgets. And BioWare will ask more from students as well if they're receiving financial -- and and some of these reforms won't be popular forever. Whatever but. Got some folks are making out just fine under the status quo but my concern is not. Look out just for the institutions. I want to look up for the students who these institutions -- -- Europe. And I think. I've got confidence that our country's colleges and universities will step up to the plate if -- given the right -- sense. Bait -- -- who should want to do the right thing for students. -- Let -- be specific here are three things we're gonna do it. Number one I'm directing my administration to come up with a new rating system for colleges that rule. -- score colleges on opportunity whether they're helping students from all kinds of backgrounds succeed. And on outcomes. Whether students are graduating with manageable debt. Whether they're actually graduating in the first place. Whether they have strong -- potential when they graduate that's the kind of information will help students and parents figure out how much value. A particular college truly offers. Right now all these ranking systems. They rank higher if -- charged more and UN and fewer students. But you should have a better sense who's actually graduating students and given you a good deal okay. So. Down the road we're going to use these ratings. We hope. By working with congress to change now we allocate federal aid for colleges. And we're -- deliver on the promise that I -- last year colleges that keep their tuition down the ones that we'll see their taxpayer funding go up. We got to stop. Subsidized schools that are not getting good results start rewarding schools that deliver -- the students and deliver for America's future. That's our -- Our second goal we want to encourage more colleges to embrace innovation. The tried to -- a providing a great education without breaking the bank. A growing number colleges cross country are testing some new -- -- -- -- finding new ways for example the use online education to save time and money. Summer trying what you're doing right here -- -- creating partnerships between high school oncologist so students can get an early jump on their degree. Making graduate pastor that means they're paying less in tuition. I want to see more schools and states get in the game so more students can get an education the cost less but still maintains like -- And we know it can be done. It's just we gotta get everybody don't have not just a few schools. -- few cities around the country. Somebody screamed and I got -- -- -- but they were just excited. Number three. Were gonna make sure that you've taken on debt to earn -- degree that you can manage and afford it. You know nobody wants to take on that. But even if we do a good job controlling tuition cost. You know some young people are so that's -- out some some loans. But. -- we think of that as a good investment because it pays off in time. As long stays manageable volume compared that. And remember again Michelle and I we went through this it took a long time a -- or student loans. But we could always manage. It and get out of hand. And I don't want -- to keep young people somewhere here today from going into professions like teaching for example -- may not pay as much money. But. Are a huge value to the conflict. And I sure don't want young people not being able to buy a home. Or get married. Or start a business because they're so loaded down -- that so what we've done is we've. Two years ago I cap loan repayments at 10%. Of a student's income after college we -- -- pay as you are. And so far -- along with a few other programs has helped more than 2.5 million students. But right now -- Current and former students aren't eligible -- we want to work with congress to fix that so we got a lot more people more eligible for this program. And then the problem -- a lot of young people don't know this programming that's. So we're going to do a better job advertising. This program so so you will never have to pay. More than 10% of your yearly income in servicing your debt. And if you're involved in public service -- not for profits. Then at some point that that gets forgiven because you're given back to society and other way. The -- we're gonna launch a campaign to help borrowers learn more about their options. We want every student to have the chance to payback the -- of the way that doesn't stop them from restoring -- drugs. So we move forward on these three points increasing value. Making sure that young people and their parents know what they're getting when they go to college. Including animations of the more colleges are giving better value. And then helping people. Responsibly manage their debt. That we're gonna help more students afford college. We're gonna help more students graduate from college. Will help more students get rid of their debt they can get started. On their lives. And it's gonna take some hard work. But. The people -- there's -- Islamabad -- Okay. The American people know so open about hard work. And we've come a long way to -- other over these past four years. I intend to keep -- moment forward on this and every other issue we're gonna keep. Pushing to build a better bargain for the middle class. And nobody is fighting to join the middle class I'm gonna keep fighting to make sure that this country remains a country -- hard work and study responsibility. -- -- We're gonna make sure that no matter who you are or were you -- from. -- -- -- -- -- -- -- -- --

This transcript has been automatically generated and may not be 100% accurate.

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