Obama's Education Plan: ABCs For Reform

Jennifer Spear and her husband are the type of family President Barack Obama says he hopes to help with his education plan.

CNBC.com President Barack Obama speaks at the Arizona State University commencement ceremony.

"Our son graduated from high school in 2007 and the subdivision we moved into was never finished," says Spear, who lives in Holly, Mich., and had planned to sell their home to pay for her son's college education.

"The developer pulled out on us and left with 75 empty lots. The house is not worth selling," says Spear.

Forced to look elsewhere for money, Spear's son now attends Saginaw Valley State University on a state loan program and a small private theatre scholarship. He lives in a house the family bought as a foreclosure to cut down on college living costs. 

Along with paying the mortgage for their son's house, fees for school and living expenses such as books, food and gas, keep adding to the family's debts.

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"We are hoping that next year, our son can obtain his own student loan to cover what we cannot," says Spear who works as an accountant in the construction industry. "The costs are overwhelming."

What's in the Obama's Plan

In March, Obama made a White House speech on education, saying: "A far reaching overhaul of the nation's education system is an economic imperative that can't wait."

As a candidate and now president, Obama has called for a sweeping $18 billion proposal covering birth to higher education. It includes reforms for teaching, funds for pre-school programs and college tax credits, as well as revamping the college student loan system.

Among the specific proposals in the plan:

• A 'Zero To Five Plan' providing support for young children and their parents.
• Increased funding for Head Start, the program for financially strapped families.
• Increased funding for the No Child Left Behind program.
• Support creation of more successful charter schools.
• Increase pay for teachers with a reward/merit system.
• Better teacher recruitment programs.
• A $650-million increase in funding for technology.
• A $4,000 tax credit for college expenses.
• A streamlined college financial aid process and low-interest government loans.

Whether Obama's plan will get the necessary buy in from different interest groups, such as teacher's unions, which oppose merit pay, is unclear at this point.

For example, those opposed to charter schools—those that receive public money but have been freed from some of the rules that apply to other public schools—have vowed to fight for more money for conventional schools.

The outlook is further complicated by the fact that the plan won't pass through the legislative process in one piece. Congress has to debate and vote on funding on the parts on an individual basis. (One section of the plan, the $650 million in technology spending, was approved in the stimulus bill, as part of a $44-billion increase in school spending for the states.)

But education experts say the plan is a good start for a long reform process.

"I think it's comprehensive and very innovative and doable," says Dr. Pamela Clute, assistant vice provost of academic partnerships and math professor at the University of California at Riverside.

"He’s right on about teachers and we have to look at teachers' quality," says Clute. "Our best students need to be in the pipeline to become teachers."

"The current and ongoing education investment will result in a higher future tax base," says Ken Borokhovich, a professor at Cleveland State University. "That will more than compensate for the cost."

Even charter school advocates seem to like Obama's approach. "He's like Nixon going to China," says Jon Hage, president of Charter Schools USA, a firm that provides charter school management services. "We like what he's done, taking the politics out of it by being fair about charters."

Pros and Cons

Though Obama's plan has general support, the emphasis on getting a college degree in the President's education speeches has some analysts cautious.

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"The focus on higher education gives me a little concern," says Dr. Alfred Rovai, professor of education at the Regent University School of Education. "That assumes that every job in this country needs a college education. That’s not the case. Some jobs don’t need one."

But other experts say not enough is being done for the K-12 programs.

"I'm thrilled we have a president who's focused on education," says Karen Gallagher, dean of the University of Southern California Rossier School of Education. "But how will they know if the programs are working? They need more transparency like they have for the higher education ideas."

Also, technology funding must do more than simply give students access to new computers, says Michael Horn, executive director of Education at Innosight Institute.

"More computers in classes hasn't produced much," says Horn. "They need to re-allocate dollars toward online learning with improved curriculum and professional development."

But reforming higher education costs may be Obama's biggest challenge, says Cleveland State's Borokhovich.

Obama wants to expand current loan programs and lower interest rates, as well as have the the government—along with the private sector—originate new, low-interest student loans. This approach will save an estimated $4 billion a year in loan costs.

"The losers will be financial institutions like Citigroup and Bank of America who have made big profits over the years from student loans," Borokhovich says. "They won't like this very much."

UC Riverside's Clute says the public may very well be on Obama's side. "I think the political climate is right for this," says Clute. "Education is an economic issue. And the economy is an issue for everyone now."

Jennifer Spear hopes Clute is right that something will change.

"We have many challenges of a financial nature," says Spear. "Our son can't find a summer job to help pay the costs [of college]. If my husband or I lost our jobs, we don't know how he would be able to finish college without our help. It's essential that he finish."

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