Clintonannouncesdrop in collegeloan defaults

by Paul Monte news editor

Reviving the popular education theme of his reelection campaign, President Bill Clinton recently announced another drop in the college default rate and promised to seek "dramatic advancements in education" in his second term.

The number of borrowers who defaulted on student loans dropped to 199,233 in fiscal 1994, compared with 212,052 a year earlier. It was the fourth straight year of decline, with default rates dropping to 10.7 percent in 1990.

The president credited tougher screening of schools, more stringent efforts to collect loans and a healthy economy that has created jobs for graduates.

Clinton said he financed his higher education with scholarships, loans and jobs. He had long felt that it should be easier for people to go to college. But, he added, "It ought to be harder to evade your obligation to repay the debt."

The centerpiece of his effort will be a $1,500 tax credit for community college classes and tax deductions up to $10,000 a year for college tuition.

More broadly, Clinton expressed a willingness to negotiate with Congress on a plan to balance the budget by 2002. Clinton sent his proposal to Congress on Feb. 6. He said it "will show that I am making a clear effort to reach out to them, to meet them halfway, to get this job done."

Clinton did not rule out the possibility of higher Medicare premiums for upper-income taxpayers, saying, "I don't want to remove all the suspense from my budget presentation."

The president's comments on education highlighted one of the family-values themes he plans to emphasize in coming weeks to set the tone for his second term.