Government Relations: Money and Politics
By Mark F. Smith
Tip O'Neill, the late Speaker of the U.S. House of Representatives, used to say that "money is the mother's milk of politics." He was referring to political campaigns, but the comment also applies to the operation of government programs. Money does tell you a lot about what is going on in government and politics. In the current political climate, it is no accident that military and homeland security programs are getting the lion's share of the federal budget. Other domestic programs, including education, are left with a much more restricted share of federal spending.
Now, a lack of money does not mean that programs cannot engender controversy. Some of the biggest budget battles of the mid-1990s involved the National Endowments for the Arts and for the Humanities. Together, the two endowments received less than $200 million a year in federal spending, but that relatively small number of dollars generated an incredibly large amount of heat and noise in Washington.
President Bush released his fiscal 2005 budget on February 2. Despite his rhetorical emphasis on education, the reality is that the budget promises more for higher education than it delivers. The U.S. Department of Education issued a press release headlining a "record $57 billion" for the fiscal 2005 education budget, calling it the "largest dollar increase of any domestic agency." Much of the four-page document touts elements of the No Child Left Behind program for primary and secondary education, but higher education is mentioned toward the end.
The most interesting part of that discussion involves the Pell Grant program. The way the release characterizes the program's fate illustrates why it is so difficult to understand discussions of money put forth by politicians.
The release highlights the proposed increase in Pell Grant funding by $856 million to a new total of $12.9 billion. It claims that "the increase would fully fund the cost of maintaining the $4,050 maximum award" and points out that "since 2000, the number of Pell recipients has grown by about 25 percent, thanks in part to the overall boom in college enrollment."
In one short paragraph, the press release raises several issues. First, it attributes the need for growth in the program to the increase in college enrollment. Yet it does not specify the causes of that boom, nor the demands that it will put on the financial aid system for higher education. One of the main reasons for the jump in enrollment is the matriculation of children of the baby-boom generation. Their entrance into college is already putting a strain on some states' higher education systems. These systems will require a much larger level of ongoing support than the federal government is proposing or the states are in a position to provide at this time.
Another cause of the recent rise in Pell recipients is the downturn of the economy. Although some recent signs point to a possible recovery, we have not seen a growth in jobs, the factor that most directly affects the Pell Grant program. When low-income individuals (those eligible for Pell Grants) lose the opportunity to work, they often turn to education and retraining programs. This phenomenon helps explain why the program has run short of money the last few years. Much of this year's increase in funding goes to cover shortfalls from last year. The same problem occurred last year. The AAUP has long advocated a mechanism that will ensure support adequate to fund the Pell Grant program fully.
More confusing, while the press release properly points out the increase in funding for the program, it admits that it is meant to "fully fund the cost of maintaining the $4,050 maximum award." In other words, the "increase" is to maintain "current funding." Since even the modest growth that occurred in the Consumer Price Index over the past year means that the purchasing power of last year's maximum award is not as much as this year's, the president's budget is really a cut in benefits to the student.
So the administration's budget proposal for the Pell Grant program can be interpreted in any of three, equally accurate, but contradictory ways: as an increase, as level funding, or as a program cut.
This paradox frustrates people who want to understand government programs, but it does enable those of all political viewpoints to use the same program proposal in their arguments. (For the record, the AAUP believes that maintaining the same maximum award while costs continue to climb constitutes a program cut.)
Mark Smith is AAUP director of government relations.
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