04/29/2011 02:29 pm ET Updated Jun 29, 2011

Don't Blame Pell for the Cost of College

As Congress continues to debate a 2012 budget, Chairman Paul Ryan and others have proposed slashing Pell grants, a program that provides tuition aid for millions of low-income students. They argue that Pell is responsible for the rising cost of college tuition. But this argument is both factually wrong and at odds with the views of the vast majority of Americans who support Pell. It also misses the bigger question: how do we make our higher education system more accessible for young Americans, connect that system to in-demand jobs, and make our country more competitive?

Chairman Ryan has been the biggest offender, repeatedly using tuition inflation as a pretext to cut Pell. He cites a single older report connecting Pell to private school tuition inflation, a claim that finds little to no support in most studies. The report also found NO correlation between Pell and public school tuition - but almost 2/3rd of recipients go to public institutions. William McGurn at the Wall Street Journal is similarly oblivious, citing the extreme example of $58,000 per year tuition at one private college as if it is connected to the (maximum) $5,500 per year Pell grant. That's just silly.

The cost of college is a complicated problem that demands real solutions, not misplaced blame. We can start by looking at policies to support and keep costs down at our public universities, colleges, and community colleges, which enroll about 70 percent of full-time students and even more part-time students. Tuition at public colleges has increased dramatically, largely due to cuts by state governments. States cut tuition assistance at public 4-year universities by an average of $700 per student between 1998 and 2008. Things got even worse during the Great Recession, with overall state funding declining by 9% in 2008- 09 and another 5% in 2009-10. The schools are of course passing their costs on to students, who often take on more debt or may not enroll at all. Top public schools like the UC system and University of Washington are also responding by increasing out-of-state enrollees (who pay much higher tuition rates), effectively limiting opportunities for in-state students.

College, if completed, is still a worthwhile investment for most students, even with rising tuition and loan debt. But as the cost of school continues to rise, it becomes increasingly riskier for young people to take on the debt without the promise of a decent job. Already, a small cohort of students who graduate with low-paying jobs but mountains of debt find that their education did not pay off financially. Of course, millions of young people attend college and acquire debt but do not graduate. These young people have the double burden of debt payments and no degree. The need to take on huge levels of debt dissuades prospective students, and makes life that much harder for graduates trying to find work and start their careers. Polls show that young people often think they'll be economically worse off than their parents, and with $1 trillion in student loans collectively owed by Americans, that assumption may not be far off.

Importantly, you cannot separate our problems in higher education from youth unemployment, which stands at twice the national average. The Recession is a major culprit, but too many young people do not have the skills or education needed to work in the industries where jobs actually are being created. Indeed, we will be 3 million college degrees short of filling demand by 2018. Our universities, colleges, and community colleges should be hubs for preparing and linking students to the business community and in-demand jobs. That cannot happen if we slash state school budgets every year, or if we cut our Pell safety net.

This country needs Pell to give young people a chance at a strong economic future, and we also need more. We need to encourage states to reverse the shrinking investment in our state public schools, and to take other measures to help to keep tuition down for students and their families. We also need to better connect government dollars to reforms that increase college completion and expand pathways between school and decent jobs for young people. And we need to involve the business community in these efforts, a stakeholder who has repeatedly called for better investment in our higher education system, to help make America more competitive in the global economy.

Clearly, Pell grants are not the problem - they are an important part of a bigger, bolder, desperately-needed solution.