She added: “A broad coalition of 62 education, student, civil rights, and public policy organizations urged the president to preserve the maximum Pell Grant award of $5,550 and protect the program from harmful cuts in the debt negotiations. Even after the recent increases in the maximum Pell Grant [amount], it will cover less than a third of the cost of attending a four-year public college next year—the smallest share in the history of the program. Full funding for Pell Grants is absolutely essential to fulfilling the president’s goal of the U.S. once again having the highest proportion of college graduates in the world by 2020.”
The debt-ceiling measure would provide an immediate $400 billion increase in the $14.3 trillion U.S. borrowing cap, with $500 billion more assured this fall. That $900 billion increase would be matched by cuts to agency budgets over the next 10 years, including cuts to federal education funding.
What follows next is more complicated. The measure establishes a special 12-member bipartisan committee to draft legislation to find up to $1.5 trillion more in deficit reductions for a vote later this year. These additional cuts are likely to come from so-called mandatory programs such as federal retirement benefits, farm subsidies, Medicare, and Medicaid. The savings would be matched by a further increase in the borrowing cap.
There’s no guarantee the committee, to be evenly split between the warring parties, will agree on such legislation. But there are powerful incentives to do so, because more budget gridlock would trigger a crippling round of automatic cuts across much of the budget, including Pentagon coffers.
The details of the final bill were still sketchy as of press time. But a source on Capitol Hill said it was possible that, if the committee fails to reach agreement on the second wave of reductions and across-the-board cuts kick in, K-12 nondiscretionary education funding could be cut by as much as $3 billion each year from 2013 to 2021. It was unclear how higher-education funding would be affected.
The bill’s passage caps a long, difficult battle between Tea Party-powered House Republicans and President Obama—with House Speaker John Boehner caught in the middle more than once.
After months of fiercely partisan struggle, the House’s top Republican and Democratic leaders swung behind the bill, ratifying a deal sealed July 31 with a late-night phone call from Boehner to Obama.
“I’m not happy with it,” House Minority Leader Nancy Pelosi, D-Calif., said. “But I’m proud of some of the accomplishments in it. That’s why I’m voting for it.”
Much of the measure was negotiated on terms set by Boehner, which included a demand that any increase in the nation’s borrowing cap be matched by spending cuts at least as large.
While it also meets some demands made by Obama, including debt increases large enough to keep the government funded into 2013 and curbs on growth of the Pentagon budget, it fails to include a key sticking point for Democrats: tax increases on wealthy individuals and large corporations to help offset cuts.
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