Obama's Audacious Education Plan: What It Actually Means

US President Barack Obama speaks on education at University of Buffalo, the State University of New York, on August 22, 2013 in Buffalo, New York. Obama is on a two-day bus tour through New York and Pennsylvania to discuss his plan to make college more affordable, tackle rising costs, and improve value for students and their families. AFP Photo/Jewel Samad        (Photo credit should read JEWEL SAMAD/AFP/Getty Images)
Jewel Samad, AFP/Getty ImagesPresident Obama speaking Thursday at the University of Buffalo.
For the last few days, President Obama has been hinting about a new education plan that, he claims, will improve the quality -- and affordability -- of college. On Thursday, in a speech at the University of Buffalo, he finally unveiled the proposal. In a nutshell, it's going to be a rating system that will rank colleges based on their cost-effectiveness. Among other things, it will factor in graduation rates, tuition costs, graduate debt, graduate earnings, and the percentage of lower-income students among the student body.

For the president, one of the most attractive aspects of the new plan is likely to be the fact that it doesn't require congressional approval. Speaking to reporters before the event, Education Secretary Arne Duncan noted that, while the administration will likely seek input from Congress, it plans to create the ratings system on its own. The first version of the system would likely roll out in 2015.

This is fine in the short run, but the White House will need congressional support if it hopes to progress to the next step, in which it plans to link student aid to university performance. While it is unclear how, exactly, this would work out, the general outline is that the government would offer larger loans and better rates to students attending higher-ranked schools. Assuming that the president can get Congress to agree, this portion of the plan would go into effect in 2018.

While colleges have yet to weigh in on the new proposal, it seems likely to ruffle some feathers: for years, colleges and universities have worked on finding ways to manipulate U.S. News' yearly college rankings, currently one of the top tools that parents and students have for choosing a school. Given the huge economic impact that the federal college list would have, it seems likely that the development of the ranking system will be heavily politicized, with colleges fighting to have their strengths more heavily weighted than their weaknesses.

The president's political opponents have already started to weigh in. Rep. John Kline (R-Minn.), chairman of the House Committee on Education and the Workforce, cautioned that Obama's plan "could curtail the very innovation we hope to encourage -– and even lead to federal price controls."

It remains to be seen if the president's plan will be able to balance its rating of educational outcomes with the potential costs of government intrusion into the educational marketplace. Even so, for students and parents looking for a better return on their educational investment, Thursday's announcement is definitely a ray of light.

Bruce Watson is DailyFinance's Savings Editor. You can reach him by e-mail at bruce.watson@teamaol.com, or follow him on Twitter at @bruce1971.

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The real problem with education at the university level is that far too many are going to schools which prepare their largely unqualified graduates for nothing in the real world. The result is too many schools, too many students, too many expenses. What we really need is what used to be called trade schools training electricians, welders, machinists, carpenters, plumbers, automotive mechanics and similar trades. They are in demand and would be immediately productive. Too many kids are afraid to get their hands dirty. We have enough semi-literate English majors!

August 24 2013 at 8:43 AM Report abuse +2 rate up rate down Reply

Wouldn't it make more sense to focus on improving the under performing universities so every student has access to a quality education? Giving preferential treatment to schools that are already doing well while punishing those that are struggling seems very counterproductive.

August 24 2013 at 8:40 AM Report abuse rate up rate down Reply

who listens to obama anyway hes full of nothing but bull ****

August 24 2013 at 7:27 AM Report abuse rate up rate down Reply
1 reply to yoggi999's comment

Apparently you do, or you wouldn't have commented on this article

August 24 2013 at 7:36 AM Report abuse rate up rate down Reply


August 24 2013 at 7:23 AM Report abuse rate up rate down Reply
welcome butch


August 24 2013 at 6:32 AM Report abuse rate up rate down Reply

We can do a lot better on financing the higher education. Only thing we have to do is keep the republicans out of the plan. That way we can be very successful.......

August 24 2013 at 3:57 AM Report abuse -4 rate up rate down Reply
1 reply to toosmart4u's comment

You should never use the words education and republican in the same post. oil and water my friend, oil and water

August 24 2013 at 7:41 AM Report abuse -1 rate up rate down Reply

Only blue state schools will receive high ratings per this President.

August 24 2013 at 2:12 AM Report abuse +1 rate up rate down Reply
1 reply to elaineen's comment

Probably becuase blue state would be interested in educational funding

August 24 2013 at 7:44 AM Report abuse -1 rate up rate down Reply

Another thing for the tax payers to pay for.

I have an idea....how about if he QUITS CAMPAIGNING!!!!! I am sooooo sick of this man and his constant vacations and campaigning.

August 23 2013 at 10:23 PM Report abuse +3 rate up rate down Reply
1 reply to raddison4x's comment

Sick? well, there is always Obamacare, or there's always the option of turning off the TV, or perhaps a 5 year vacation. or maybe you should just try to shed some of your hatred, that's actually what's making you sick. There are a multitude of remedies for your kind of illness

August 24 2013 at 8:01 AM Report abuse -1 rate up rate down Reply
1 reply to cmcneo's comment

If Obama Care was so great why is congress exempt?
One set of rules for the rulers and another set for the ruled?
Tyranny over the stupid isn't difficult.
No republican b.s retorts are necessary. I'm a filthy independent. The bastard of all politics, who looks for common sense and doesn't find it in either party.

August 25 2013 at 12:55 AM Report abuse rate up rate down

It's Obamacaire for Education
administeerd by the IRS and Homeland Security.
But you don't have to read the royal decree
before it is implemented.

August 23 2013 at 10:08 PM Report abuse +4 rate up rate down Reply

So, Obama plans to socialize college as well? Not surprised a bit.

August 23 2013 at 9:24 PM Report abuse +7 rate up rate down Reply