Student loan debt is a national emergency. The rising cost of college affects families, communities and organizations that require highly educated workers, and it’s a problem we need to tackle together as a state and as a country. Most pressingly, we need to reduce cost as a barrier for lower-income students interested in pursuing a college education.
The Pell Grant is an essential tool for doing just that. I know because I was one such student, whose ability to attend college more than 30 years ago was made possible by a combination of Pell Grants, institutional financial aid, a work study job, and loans. My college education transformed me and opened doors of opportunity I otherwise would not have had. As the president of a private college, I am not only grateful for what my Pell Grant support afforded me, but I also believe that more students today should have access to those same opportunities. For that to happen, federal investment in education provided by Pell Grants needs to increase.
As Congress debates the next budget through the budget reconciliation process, we have an opportunity to double the Pell Grant maximum from $6,495 to $13,000. While the current House proposal would offer a $500 increase in the Pell Grant maximum, I believe Congress should be bolder in its support for this cornerstone federal student aid program.
The last time Congress made a substantial investment in the Pell Grant program was the 2009-10 stimulus package. The share of college costs covered by Pell Grants is at an all-time low. At its peak, the maximum grant covered three-quarters of the cost of attending a four-year public college. Today, it covers less than one-third of that cost.
Doubling the Pell Grant would help make higher education more affordable for low- and moderate-income students and families, reduce student debt and increase the rate of degree completion for our neediest students. These grants can be used not only for tuition but also to help meet students’ basic needs — like food, housing, health care and child care. Importantly, the grants are targeted to the students who need it most and are not tied to just one type of higher education institution; they promote student choice because they are awarded to the individual student and are portable.
Since the pandemic began, college enrollment is down 13% across all of higher education, and financial aid applications are down 6% for low-income students. Doubling Pell as part of the post-pandemic recovery will ensure this generation of young Americans receives the education and training they need to both move up the economic ladder and get the economy working again, while helping America compete in a global economy that demands educated workers.
In Minnesota, nearly 115,000 students, almost 24%, who attend our public and private colleges receive Pell Grants. Nationally, Pell Grants already help nearly 7 million low- and moderate-income Americans attend and complete college annually. A substantial increase would have a multi-generational effect on reducing poverty in our state and across the nation. These awards are especially critical for lower-income students of color, with nearly 60 percent of Black students, half of American Indian or Alaska Native students, and nearly half of Hispanic/Latinx students receiving a Pell Grant each year.
Student loan debt harms the entire economy in at least three important ways. First, the impacts of the debt are felt most keenly by those from the lowest-resource families, which compounds the effects of inequality passed from one generation to the next. Second, it limits the purchasing power of those with student debt. When young people are disproportionately burdened by student debt, they will be less able to participate in — and help grow — the economy in the long run. And, third: These debt burdens hold borrowers back from generating wealth through means such as buying a home or starting a business.
According to a report published last month by the Gender Equity Policy Institute, doubling the Pell Grant would achieve the following results: Community college students who receive the maximum award would graduate debt-free; bachelor’s degree students who receive the maximum award would see a 79% reduction in debt; and students, on average, would see their loan debt slashed in half or more.
It’s no accident that nearly 1,200 organizations, including nearly 900 colleges and universities, are in support of doubling Pell Grants. Doing so would increase higher education access for many low income families — rural and urban, of all races and ethnicities — and would help lift many out of generational poverty.
As Democrats in Congress work with the Biden administration on what likely will be a scaled-back version of the president’s social safety net and climate plan, I strongly urge the entire Minnesota congressional delegation to support a significant investment in the Pell Grant program. While doubling the maximum Pell Grant award would have the most impact, any substantial increase is certain to give more Minnesota students a chance at the kind of upward mobility that will have lasting effects on their careers, their families and our state’s economy for generations to come.
Suzanne M. Rivera is the president of Macalester College in St. Paul.