WASHINGTON -- In a Senate subcommittee hearing Wednesday morning, Education Secretary Arne Duncan reiterated the Obama administration's commitment to keeping the maximum Pell Grant at $5,550 in fiscal year 2012, although the grants are the main reason the Education Department's requested budget has increased 20 percent since 2010. "We desperately want to preserve that maximum Pell Grant," Duncan said, adding that the administration has made "tough calls," including ending year-round Pell Grants and proposing the end of interest subsidies on graduate student loans, to make that possible.
Senator Richard Shelby, the senior Republican on the Senate Appropriations Subcommittee on Labor, Health and Human Services, Education, and Related Agencies, responded that the department would have to prioritize. "How are we going to pay for this? That's the bottom line," Shelby said. "What are your priorities in the Department of Education?... You're going to have to make some decisions." Although much of the hearing was devoted to elementary and secondary education programs, Duncan also responded to Senator Richard Durbin, a frequent critic of for-profit education who called proprietary colleges a "Ponzi scheme" that made him less willing to support federal financial aid programs. "We've tried to move in the right direction, and seen significant changes in behavior," Duncan said of the department's program integrity rules. "I think this is going the right way, and I feel much more comfortable in our investments in grants and loans -- more comfortable today than before we did our regulation."