Five Things You May Not Know About
President Obama’s FY 2011 Budget Request
 

 
New Mandatory Education Programs Increase the Deficit:  In addition to proposing to make Pell Grants an entitlement program, the President’s budget would create five new education entitlement programs and increase entitlement spending on student loan repayment programs.[1]   By its own accounting, the President’s budget shows these programs will increase spending by $100 billion over the next 10 years.[2]  And this does not even include the $118 billion unfunded portion of Pell Grants to maintain the current maximum grant amount level.  Although President Obama claims to pay for this new spending through eliminating subsidies to lenders and having the government takeover student loans, his budget forecasts that 100% direct lending by the federal government would save $43 billion­far short of the $100 billion in new spending that this Administration creates.[3] 
 
Continues to Fund Unproven or Discredited Programs:  President Obama and Secretary Duncan have repeatedly said they want to “fund what works in education,” yet the fiscal year 2011 budget contains requests for an additional $1.3 billion for the Race to the Top Fund and $500 million for the Investing in Innovation Fund.[4]  These unproven programs have not yet provided one dollar to states or local school districts so it is impossible to know if they have any impact on students.
 
The budget request also contains $8.2 billion for Head Start, a $989 million increase, despite the fact that a recently released experimental evaluation by the U.S. Department of Health and Human Services found that Head Start has had little to no effect on cognitive, socio-emotional, health, and parenting outcomes of participating children.[5]  While early childhood education is important, we should be funding strategies that work, not those that have been proven ineffective by years of research.
 
It is also worth noting that several programs that are funded in the President’s fiscal year 2011 budget request were eliminated in his request last year because they were considered “duplicative” or “had little impact.”[6]
 
Refuses to Fund Programs That Are Proven To Work:  In contrast, the President’s budget request contains no funding for the popular DC Opportunity Scholarship Program (OSP) despite the fact that a rigorous study by the Institute of Education Sciences found that students in the program experienced statistically significant improvements in reading that were equal to more than 3 months of additional schooling.[7]  The study also found that parents experienced increased satisfaction with the quality and safety of their children’s schools.[8]  In fact, the lead researcher of the program, Dr. Patrick Wolf, says the program “has met a tough standard for efficacy in serving low-income inner-city students.”[9] 
 
Exacerbates the Largest Pell Shortfall In The History of the Program:  The Pell Grant program is running an unprecedented $18 billion shortfall.[10]  The President’s budget demonstrates that in order to maintain the current maximum grant level, the program will need an extra $118 billion in deficit spending over the current baseline for 2011 to 2020.[11]  Yet the President’s budget doesn’t pay for it.  Instead it shifts Pell Grants to an entitlement program and then assumes that the spending would just automatically increase every year.
 
Claims to Consolidate Programs But Would Actually Authorize More Spending:  The Department of Education’s fiscal year 2011 budget claims to consolidate 38 programs into 11 new authorities.  While this is technically accurate, it does not actually result in a decrease in the amount of funds that are being requested.  In fact, the budget request for consolidated programs is $720 million more than the amount awarded in fiscal year 2009.[12]
 

 
Amanda Farris
Education and Welfare Policy Analyst
Republican Policy Committee

[1] Budget of the U.S. Government, Fiscal Year 2011, page 166. Available at: http://www.whitehouse.gov/omb/budget/Overview/ Programs include Graduation Promise Grants, Early Learning Challenge Fund, College Access and Completion Fund, Community College Funding in the American Graduation Initiative, and making permanent two year mandatory funding for minority serving institutions.
[2] Ibid
[3] Congressional Budget Office, Interested Parties Memorandum, Table 9, available at: http://www.cbo.gov/budget/factsheets/2010b/studentloans.pdf
[4] The U.S. Department of Education’s Fiscal Year 2011 Budget Summary, page 20.  Available at: http://www2.ed.gov/about/overview/budget/budget11/summary/index.html
 
[5]Head Start Impact Study Final Report, January 2010, available at: http://www.acf.hhs.gov/programs/opre/hs/impact_study/reports/impact_study/hs_impact_study_final.pdf
[6] RPC Analysis of the U.S. Department of Education’s Fiscal Year 2011 Budget Summary, pages 70-79.  Available at: http://www2.ed.gov/about/overview/budget/budget11/summary/index.html   Programs include Even Start, Academies for American History and Civics and Javits Gifted and Talented Education.
[7] Evaluation of the DC Opportunity Scholarship Program, Impacts After Three Years, March 2009, available at: http://ies.ed.gov/ncee/pubs/20094050/index.asp
[8] Ibid
[9] Testimony of Dr. Patrick Wolf before the Senate Homeland Security and Government Affairs Committee, May 13, 2009, available at: http://hsgac.senate.gov/public/index.cfm?FuseAction=Hearings.Hearing&Hearing_ID=0358fc7c-ce9e-4008-b0d0-f0131a10dc43 .
[10] CBS Evening News, December 9, 2009, available at: http://www.cbsnews.com/stories/2009/12/09/national/main5956333.shtml
[11] The Budget of the U.S. Government, Fiscal Year 2011, page 158. Available at: http://www.whitehouse.gov/omb/budget/Overview/
 Shortfalls and surpluses are not uncommon in the Pell Grant program since every eligible student who applies for a grant will receive one.  If the federal government estimate of how many students will apply in a given year is too low they experience a shortfall.  This shortfall is noteworthy because it is the largest shortfall in the history of the Pell program.
[12] RPC Analysis of the U.S. Department of Education’s Fiscal Year 2011 Budget Summary, pages 70-79, available at: http://www2.ed.gov/about/overview/budget/budget11/summary/index.html, and additional data provided by the U.S. Department of Education via email [available upon request].
 
 NOTE: this excludes $1.85 billion in funding for Race to the Top and the Investing in Innovation Fund because those were new, and theoretically temporary programs, and because they each make up one of the new authorities with no further consolidation of programs.