(CNSNews.com) - As President Barack Obama was preparing this week to embark on a bus tour on which he intends to propose ways to “fundamentally rethink and reshape” the higher education system in the United States, the U.S. Department of Education’s National Center for Education Statistics released a new report on the financial aid paid to American college students.
In the 2011-2012 school year, says the report, the federal government provided 71.4 percent of full-time college students with some form of taxpayer-funded aid for their education.
According to the report, 55.2 percent of full-time college students in the 2011-2012 school year took out direct federal student loans, 47.4 percent received a federal grant, and 10.5 percent were in some type of federally backed work study program.
On average, full-time college students received $10,500 in federal aid during the year.
The average value of the direct student loans made to a full-time college student in 2011-2012 was $7,000, according to the report. The average value of the Pell Grants made to full-time students was $4,400.
While 71.4 percent of full-time college students received federal aid in the 2011-2012 school year, 24.0 percent got aid from state governments.
In addition to the average of $10,500 in aid the federal government paid out to full-time college students during the school year, the state governments gave the full-time students they aided $3,300 during the year—with $3,200 of that being outright grants.
The Health Care and Education Reconciliation Act--one of the two bills (together with the Patient Protection and Affordable Care Act) that made up Obamacare--included language terminating the program through which the federal government guaranteed student loans made by private lenders. After enactment of Obamacare, all federally guaranteed student loans were made directly by the U.S. Treasury.
"Under the DL [direct loan] program, the federal government essentially serves as the banker--it provides the loans to students and their families using federal capital (i.e., funds from the U.S. Treasury), and it owns the loans,” the Congressional Research Service explained.
At the end of March 2010, the month Obamacare was enacted, the outstanding balance on federal direct student loans was $169.526 billion, according to the Monthly Treasury Statement for that month. By the end of July 2013, according to the Monthly Treasury Statement for that month, the outstanding balance on direct student loans had grown to $618.508 billion.
Since Obamacare was enacted, the outstanding balance on federal direct student loans has increased by 265 percent.
The NCES study was based on a survey sample of approximately 95,000 undergraduate students. The study said that in the 2011-2012 school year there were 26 million undergraduate student in the United States.
“So what the president believes that we need to do is we need to fundamentally rethink and reshape the college--the higher education system, and we need to find a way to build on innovation,” White House Deputy Press Secretary Josh Earnest said at Tuesday’s press briefing.
“So the president on this bus tour will lay out some fundamental reforms that would bring real change to the way that we pay for college education in this country,” said Earnest.
“Now, the proposals that the president is going to lay out are not going to be popular with everybody, but they are going to be in the best interest of middle-class families,” he said. “And the president is looking forward to having that discussion over the course of Thursday and Friday in addition riding on a bus.
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