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Who's Tops On Tuition?

The candidates play against type, as Bush aims aid at the poor and Gore targets middle-class parents

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Al Gore and George W. Bush have at least two things in common: kids in college and an urgent need to appeal to other baby boomers who face rising bills for higher education. Gore promises to spend more on aid to college students and their parents: $41 billion over 10 years, vs. $11 billion over five years for Bush. No surprise there. But here's the zinger: it is the Democrat who holds out the bigger goody bag for families above the median income, while the Republican would offer more financial aid to the poor. Says Terry Hartle, vice president of the American Council on Education: "It's like a play where nobody is playing his assigned part."

Gore's plan would spend $36 billion on income tax credits to offset costs of college tuition. A family could receive as much as $2,800 in tax credits each year. Gore would also allow families to sock away up to $2,500 a year in new tax-advantaged accounts, similar to 401(k)s, which they could tap at any age for higher education or job training. And Gore would spend $2 billion nationalizing a program, already in place in some states, that gives parents tax breaks to save for their kids' college tuition.

Experts say Gore's measures wouldn't greatly increase the number of middle-class parents who can afford to send their kids to college but would allow most of them to do so without cutting other expenditures. And Gore's tax credits would be of no help to the millions of working Americans who don't earn enough to owe income tax (even though they pay a hefty chunk of their wages in Social Security and Medicare taxes).

Amy Wilkins, principal partner at the Education Trust, a left-center research organization, says her college-professor parents, who are sending her younger sister to Yale this fall, have calculated that under Gore's plan, they would not have to rent out their Delaware beach house as often next summer. "But if they were making less than $21,000, there would be nothing for them," she argues. "Low-income kids get the short end of the stick."

Bush's plan would let parents save as much as $5,000 a year in new tax-advantaged accounts that could be tapped for a wide range of education costs, from private kindergarten to grad school. Bush also offers $1.5 billion in merit scholarships, the majority of which are likely to be claimed by kids from more affluent schools.

But most of his gravy is for the less well off. Bush promises $1,000 bonus grants to low-income high school graduates who take college-level math and science courses. He would add $600 million in new funding for historically black and Latino colleges. And he would spend $5 billion to fully fund Pell grants to pay for the freshman year of college for students from families earning less than $20,000 a year.

Ivan Frishberg, director of the higher-education project for the State Public Interest Research Group in Washington, notes that for the sum Gore proposes to spend on tax breaks for tuition, he could fully fund Pell grants to send low-income students to four years of college--and would have money left over to offer tax credits for interest paid on student loans. These measures would directly help students--who are the signatories to most college debt--rather than their parents. But politicians know that in 1996, only 30% of 18- and 19-year-olds voted, in contrast to 62% of people 45 to 54. Better bonbons will come this fall only if there's an outbreak of some truly radical student behavior: voting.

COLLEGE AID

Paying for college ranks as a top concern among both students and their parents. Here's how the major provisions of the candidates' proposals would affect families with different incomes:

THE BUSH PLAN

FOR LOWER-INCOME FAMILIES Fully funds Pell grants up to the maximum $5,100 for the first year of college. Gives $1,000 bonus grants to high school students taking advanced math and science courses

FOR UPPER-MIDDLE-INCOME FAMILIES Lets them put away as much as $5,000 a year in tax-advantaged accounts for a wide range of educational expenses

THE GORE PLAN

FOR LOWER-INCOME FAMILIES Calls for increased Pell grants but doesn't put money in the budget for them

FOR UPPER-MIDDLE-INCOME FAMILIES Gives as much as $2,800 in tax relief for up to $10,000 of college-tuition expense. Allows families to put away as much as $2,500 in tax-advantaged accounts, which can be tapped for higher education and job training

Check out the MTV & TIME town-hall forum with Al Gore on youth issues Tuesday, Sept. 26, at 8 p.m. (E.T./P.T.) on MTV. The program will be repeated at noon on Sept. 27. (George W. Bush has been invited to have a forum as well but has not yet agreed.) See time.com for forum coverage.


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Cover Date: October 2, 2000

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