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YOUR BOTTOM LINE

Cutting Education Budget; Nutritious School Lunches; Sesame Street Initiative

Aired April 16, 2011 - 09:30   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


CHRISTINE ROMANS, CNN NEWS ANCHOR: Republicans and Democrats are putting America on a diet with very different approaches and how to get America on the right fiscal path. What does it mean for your child's education?

Welcome to YOUR BOTTOM LINE. I'm Christine Romans. This morning, how education fares in a new era of fiscal discipline in Washington. I want to get to Jessica Yellin, CNN national political correspondent in Washington.

Good morning, Jessica. How did education make it through the week and all of this talk of budget cuts and fiscal restraint down the road?

JESSICA YELLIN, CNN NATL POLITICAL CORRESPONDENT: Well Christine, good morning. As part of the budget deal the president and Democrats hashed out with Republicans there will be some changes in various education programs. For example, new summer Pell grant programs will be ended, 19 literacy technology and small learning programs, eliminated. There's one smaller addition, a voucher program for the District of Columbia, that's going to be restored. But big picture, all of this was really tinkering on the edges and now, the real fight begins.

The president and congressional Republicans, you know, they're going to start fighting over next year's budget and how to save trillions of dollars over the next decade. And as the two parties make decisions about where to cut, they're looking at very, very different differences on how they approach education and what it may mean for your child's future.

ROMANS: Do, let's start with the president, then. What's he pushing for? You always hear about the president talking about new investments, smart investments in education and Republicans, I mean, and some libertarians, quite frankly, they like to say we want to get rid of the Department of Education, we want to do -- be smarter with the money we have. Let's start with the president.

YELLIN: Yeah, OK, well, there are some in Congress who do want to get rid of the Department of Education, they'll be voting that way, but that's not the president's vision. His 2012 budget would, for example, keep Pell grants where they are. $5,550 per student. He'd have a nominal increase in the budget for Head Start to $8.1 billion and then he's emphasizing his "Race to the Top" program, which, in a nutshell, essentially, rewards innovation for school districts. But that's one philosophy. ROMANS: Right, absolutely, and the president's "Race to the Top," I mean, some of that money going into schools that have been failing, trying to turn them around. We've seen that work, in fact, in some places in Florida, for example. But Republicans emphasize different priorities, don't they?

YELLIN: Right and this is the party that has members who, as you say, want to eliminate the Department of Education. They want to shift education from being federal government funded and focused to local districts. So, for example, they want to reduce the Pell grants that the president wants to keep stable. They want to reduce the budget for Head Start to $6.8 billion. They want to eliminate the president's program race to the top.

And then hanging over all of this is the question of reauthorizing "No Child Left Behind, the big Bush era education reform program that has been so controversial since it was enacted. It's up for reauthorization. Republicans want a slow approach to it, but the president is insisting it get reauthorized by August. This is less about funding than about a reauthorization fight and priorities, but expect it to be a big political fight as we're entering 2012.

ROMANS: All right, Jessica Yellin, breaking it down for us, from Washington. Have a great weekend, Jessica. Thanks.

So, if America needs to tighten its belt, how do you do it and not sacrifice important investments in education? In Washington is Lindsey Burke, education policy analyst for the Heritage Foundation, also a former high school language teacher. And here in New York is Leonie Haimson, executive director Class Size Matters the co-founder of the grassroots organization Parents Across America.

Welcome to both of you.

First, Lindsey, you say education you think is relatively unscathed by budget cover proposals at this point?

LINDSEY BURKE, HERITAGE FOUNDATION: Right. And here's what we know. Education spending has been on an unsustainable path for the past three decades,for more than three decades now, and when we look at the president's FY-12 it actually seeks to further increase that spending by 20 percent, over 2010 levels alone. So, ultimately it's really not about spending more money. And we need to start thinking about how to spend that money wisely and better target those resources to the schools that are most in need.

ROMANS: But Leona, you say that there are things for parents here to be concerned about, right now. We know that, you know, the National Education Association praising the president and the budget deals for preserving Pell grants and preserving Head Start, but some associated with teachers and some associated with education are concerned overall about what they say is this feeling as though education is going to get cut, it's going to be on the chopping block.

LEONIE HAIMSON, CLASS SIZE MATTERS: Right. Well, we know from this budget deal they cut $2 billion from education overall and nearly $1 billion from pre-k to 12 and some of the programs they cut are extremely important and valuable to students, special ed funding cut by $23 million, Title 1 funding, which goes to our neediest schools, with our neediest students, was cut by $30 million and Title 2, which can be used to hire teachers that are being laid off in mass right now and causing huge increases in class sizes across the country, was cut by almost half a billion dollars.

And one more thing, arts education, which is incredibly important to our schools and so many of them are losing their art programs, was cut by another $15 million. So these are programs that we know work, we know that they help kids, we know that they help children become more successful as adults, and really, disinvesting in public education is the worst kind of decision our nation can make at this point.

ROMANS: Well, Lindsay, you think we need to wring some of the excess out, I mean, you thing that we need wring some of the money out of the system so that it sparks some innovation and more choice. I mean, you disagree with Leonie.

BURKE: Yeah. That's exactly what we need to start doing. Look, the federal Department of Education budget is the third largest discretionary budget behind only the Department of Defense and the Department of Health and Human Services. We have seen federal per pupil expenditures triple since the 1970s. And yet, despite all of that spending, we've seen academic achievement stagnate, we've seen graduation rates stagnate. Graduation rates the same today that they were in the 1970s. and our students are still not competitive with their international peers.

Instead of continuing the spending spree, instead of continuing to try to improve education from Washington, we need to start thinking about how to devolve dollars and decision making down to the state and local level so those closest to the student who know them best can better target those resources.

ROMANS: Leonie, let me just ask you that -- let me just have you follow up on that idea because, I mean, it's an ideological difference, here, a big ideological difference. I mean, there are some who say we don't want it to give more money to a system that hasn't been getting better and better. Should we do more with the money we have, rather than -- or even cut some programs in order to keep funding others?

HAIMSON: Well, if they are programs that don't work, I'm all for cutting them. Two of the things that are in this budget deal are "Race to the Top" at $700 million and the so-called innovation grants at $150 million. And basically, these are the Department of Education's and Arne Duncan's personal slush funds that he gets to award to grants states, whatever his particular policy preference may be at that point. They're competive grant programs. We believe education is a right, not a race nd we would like to see those particular programs that they're spending almost a billion dollars, zeroed out in favor of some of the other programs which they cut mercilessly.

ROMANS: So much to talk about and I'm telling you with this sort of fiscal austerity in the air, we're going to be talking more about priorities in education and also in spending and taxes, in general. So I hope to talk to you both again very soon. Leonie Haimson, thank you so much, executive director of Class Size Matters, also Lindsay Burke, a former high school language teacher and also education policy analyst at the Heritage Foundation. Thank you both for joining me. Have a wonderful weekend.

Thirty-eight minutes, just 38 minutes, that's the average amount of college advice high school seniors are getting from their guidance councilors and that's simply not enough especially when this is the biggest investment and the biggest debt you'll ever have, your college education. The smartest ways to manage your student debt.

(COMMERCIAL BREAK)

ROMANS: Student loan debt in this country is now bigger than credit card. For the first time ever student loan debt is likely to top a trillion dollars this year. With that bachelor's diploma comes some pretty serious student loan bills.

Here with me now, personal finance authors Terry Savage and Lynnette Khalfani-Cox.

Welcome both of you. I'm so excited to talk to you about this, because this mountain of debt is a real concern for kids, especially without a big robust jobs market to go into.

Terry, I wanted to show you the statistic. The economy is turned, families are struggling to pay for that degree. Two-thirds of bachelor degree recipients in 2008 graduated with debt. That's up from about half in 1993. Are we not saving enough or is an education out of the reach of middle-class Americans?

TERRY SAVAGE, PERSONAL FINANCE AUTHOR: It's a combination of things. What we have here is a very quiet credit crisis compared to the mortgage crisis, whic we can see in foreclosures, but of course you can't default on student loan debts, so people struggle. And the same things that led to the mortgage crisis, relatively easy credit, Congress pushing that out there and the banks being willing to lend because these were safe loans, burdened at lot of families with loans that they couldn't afford, they didn't realize how it was piling up. Combination of graduating without a job and having these big repayments due, is a burden that will change lives for a whole generation.

ROMANS: Go ahead.

LYNNETTE KHALFANI-COX, PERSONAL FINANCE AUTHOR: Well, so you certainly can default. I think she was saying about they don't have anything they can take back like a mortgage, like a home. I know that's what you...

SAVAGE: It's not discharged in bankruptcy and if you are -- if you haven't repaid your student loans by the time you're an old person they'll garnish your Social Security.

ROMANS: It will follow you forever. It's a debt that will follow you forever.

KHALFANI-COX: That's right. And you think about it, also, the government is cutting back on Pell grants. In Congress now they're talking about doing that and so that means more people are taking on student loans. And then, of course, the price tag of a college education has just skyrocketed over the past decade. So, you combine all of that with families not saving enough and that's why we've got this big student loan debt crisis.

ROMANS: Let's talk, ladies, about how much kids are taking out. Last year graduates who took out loans left college with an average of $24 in debt and those students are not alone.

KHALFANI-COX: That's right. We're going to get to the situation where people just won't be able to pay off their student loan debt. The president has admitted it took, you know...

ROMANS: Nine or 10 years.

KHALFANI-COX: Exactly, to pay off his. And right now, if you look at the statistics, the average loan repayment period is about 15 years. A lot of students aren't doing the 10-year repayment plan and it's taking longer than ever. So, this is a really important topic.

ROMANS: OK, so let's turn now, both of you, how do you make sure this good debt, because look, people should probably go to college if they have the right skills set, and they're taking the right amount of time, and they have the right major, how do you make sure that good debt doesn't turn to bad debt -- Terry.

SAVAGE: This is important, I think first of all, we have to say that a college education is still worth it, but you have to pay for it wisely. So, some dos and don'ts for parents. First thing is let's talk instead of my kid got into most of the prestigious, expensive school, how about two years living at home and attending a community college and then transferring. That can cut the burden tremendously. I don't think parents should rob their retirement for their kids.

ROMANS: Me too.

SAVAGE: Because the kids aren't going to be around there to take care of them in they're old age.

ROMANS: And you can't borrow for your retirement. You can borrow for college, even if it's too much, but you cannot borrow for retirement.

SAVAGE: And right now, financial aid officers are coming out from the universities, it's very important to point out that the initial aid offer could be redu rediscussed with the college and you might be able to figure out a way to get a little more. There's a great Web site, FindAid.org, which will help you calculate the different loan offers you get to see which schools net really gives you the best deal. It could be a prestigious school that's' offering more.

ROMANS: Terry Savage and Lynnette Khalfani-Cox, always wonderful to see you. Have a great weekend, ladies. One Chicago school bans parents from packing their kids' school lunches, saying mom and dad are sending too much junk in that little brown bag. Is this protecting children's health or is this a nanny state? Plus, we'll show you how to pack a healthy lunch for your own child.

(COMMERCIAL BREAK)

ROMANS: So for some of us, school lunches were mystery meat and gelatinous mac and cheese or maybe you were lucky and your mom packed you a PBJ and pretzels. Well, these days there's peanut allergy, a full out war on sugary snacks and drinks and a real effort to get kids healthy.

Kat Kinsman is the managing editor of CNN Eetocracy and Gregory Jantz is a food psychologist and author of "Healthy Habits, Happy Kids."

OK, both of you, on our radar this week, chocolate milk. A number of schools are banning it, but in Fairfax County, Virginia, a low fat version had to be put back on the menu because parents, students, nutritionists and special interest groups complained.

Gregory they said no they wanted to keep the chocolate milk. The kids were in an uproar. Is there a way to tweak our school lunches so we can keep the things we love, but also get rid of the sugar?

GREGORY JANTZ, PSYCHOLOGIST: Oh, I don't know. You know, some of the school lunches are not good at all. This recent thing really, I'm upset by it because it's disempowering parents.

ROMANS: What do you mean disempowering parents? You're upset that the chocolate milk got back on?

JANTZ: Well, you know, here's the thing. No, no, no that's OK. But if we try to control the lunches and what we're doing is saying what's best for our kid, what's happening is the parents are losing the freedom of choice of what they need to do for their kids.

ROMANS: I see what you mean. Well, this brings me to a story also this week, in one Chicago school, homemade lunches from home no longer an option. The Little Village Academy banned brown bag lunches from home because -- unless the student had a medical excuse. The reason is the principal says nutrition wise the food they served is healthier.

Kat, what we're talking to school for our kids isn't always the best thing.

KAT KINSMAN, CNN EATOCRACY: It is not. There are so many better decisions that can be made and that's why it really should come from the parents. The second you demonize the food, the kid wants nothing but that food. You know.

JANTZ: That's exactly right. Exactly right.

ROMANS: Well, Gregory, in the case of the Chicago school, one thing that is interesting is that a majority of the kids are on school lunch program anyway and the school is on this mission to make sure what the kids are eating is healthy for them because they said, frankly, what the parents were sending wasn't healthy. So I guess, I don't know, I see it both ways. I can see the school getting involved but I can see the parents want the choice.

JANTZ: Well, as a parent, if I can involve my kid in packing a lunch and doing it as a teamwork and using it as a learning opportunity and I can throw a nice note in the lunch, the lunch bag comes back, I can look and see what they ate or didn't eat and I can use it as a great learning opportunity.

ROMANS: Kat, what are most kids getting for lunch at school?

KINSMAN: Oh, it depends on the district, but often it's not pretty. Often it's a lot of great big Sysco cans that come in there like...

JANTZ: It's not pretty.

KINSMAN: ...a lot of high fructose corn syrup and fat and really, it's...

ROMANS: Even the applesauce is full of an awful lot of things before you get to the apples.

KINSMAN: This is true. Some districts are trying to do better about it. Chicago school district made regulations a lot better, but it still, there's a long way to go.

ROMANS: Greg, healthy eating has to start at home, but 34 percent of American adults are obese, Greg. So, how can parents make healthy eating a part of daily life?

JANTZ: Well, this is the thing, we've got to look at ourselves first, because until we do that, you know, our kids are going -- I mean we have more obese kids now than we've ever had before, and the toddlers are overweight, we got to make bigger car seats. So, we have a real problem, here. You know, I have been treating eating disorders for nearly 30 years and I'm seeing a trend. The eating disorders are dropping to younger ages: 10, 11, 12 years old.

ROMANS: All right, Gregory Jantz, I'm going to leave it there with you. "Healthy Habits, Happy Kids," is the name of the book. Thank you for that. And maybe stick around, Greg, so you can see this too, because Kat's going to give us a demonstration about what we should be packing to lunch.

We can complain about what the school is serving and how maybe it is too slow, the changes to more healthy food in some school districts, but what can you pack at home, Kat, to make sure that your kids is getting what they need.

KINSMAN: I agree with him so much that you just have to make it fun, visually appealing and there are some tricks that you can use. Marketers have every trick at their disposal.

ROMANS: Branding the school lunch.

KINSMAN: You absolutely have to brand your school lunch, if you are allowed to bring it yourself.

Now, this doesn't look very pretty. The great thing about this, it's a wrap. The kids are never going to see this wonder healthy party, because peanut butter used to be a staple and you can't really use that any more, I turn to hummus, which I say is like the glue of an amazing meal. It's packed with so much protein and you go with, we did a fancy pants version here with some organic low fat cheese and some organic turkey slices. You can, you know, whatever you can afford is great just as long as you're trying some great multi-grains there that you just can buy in bulk, batch of them.

ROMANS: And then you roll this up and cut it and the kid thinks it's a burrito something kind of neat looking.

And you stack it -- you stack the deck in your favor, so you figure out what the kids are already willing to eating at home, hopefully because you're cooking healthfully at home, aren't you?

ROMANS: Kat Kinsman, the managing editor of CNN Eatocracy, Thank you so much.

KINSMAN: Thank you.

ROMANS: "C" may be for cookie, but "S" stands for spending, sharing and saving. Our very special and hungry guest, Cookie Monster. He's here to show us how easy it can be to save.

COOKIE MONSTER, SESAME STREET: Oh, you want me to save it. Sorry. Me save it. Dum dee dum dum dum.

(COMMERCIAL BREAK)

ROMANS: Well Elmo, that's a clip from "Sesame Street" latest initiative, "For Me, for You, for Later." First steps to spending, sharing and saving where Elmo and the gang they learn all about the value of earning money.

Beth Kobliner is a personal finance author who helped out with this project and you probably already know our other guest, our furry blue cookie loving monster, Cookie Monster.

COOKIE MONSTER: Hello.

ROMANS: Cookie's learning about things like delayed gratification and how to save and not...

COOKIE MONSTER: Oh, that not easy.

ROMANS: And not to spend.

BETH KOBLINER, SESAME WORKSHOP: Well, that's the whole initiative, right Cookie? The financial initiative that we worked on together. This project to help children learn how to save. And it's a little bit like waiting, which is very hard to do, just like you have to wait...

COOKIE MONSTER: Tell me about it. Me, wait.

KOBLINER: Wait for a birthday to come. Wait for holidays to come.

COOKIE MONSTER: Right.

KOBLINER: Wait for the swings. Well, you also have to wait for the goal, the thing you want to save your money for. And it's more than just four quarters equal a dollar. In partnership with PNC what "Sesame Street" did was this initiative, which is free online at the website SesameStreet.org/save and this will give lots of information about very simple concepts like value. What is value? You value a friend, you value...

COOKIE MONSTER: Cookies! You value cookies.

KOBLINER: Some people value cookies more than anything.

COOKIE MONSTER: Yeah, yeah, tell me about it.

ROMANS: Why is it more conceptual than just four quarters equals a dollar. I mean, kids learn that in school all the time, but I mean, money is something that we don't really teach kids and they don't learn about it. What are you learning about saving and spending and sharing?

COOKIE MONSTER: That good. That good. Me learn, me learn to have three jars: One for spending, one, ow, for sharing and one for saving. Spending, sharing, saving. Yeah.

KOBLINER: That's right, spending, sharing, saving, because he always thought the jars were for cookies.

COOKIE MONSTER: Of course, cookie jar.

KOBLINER: Cookie jar. But they're for three separate areas and you, by getting those concepts down in very user friendly ways and learning about choices, what you use your money for. How do you use that dollar to make decisions?

ROMANS: Beth, when you're raising your own kids, you know, for Cookie, it's cookies, but when you're raising your own kids, do you find what they like and try teach these money concepts around what they like and what rewards them?

KOBLINER: Absolutely, I think a huge part of that is sort of working toward a goal and maybe you don't have that one cookie today, but you can save up for a bigger cookie in a week.

COOKIE MONSTER: Oh, it not easy.

KOBLINER: It's not easy. It's hard.

COOKIE MONSTER: But me learning. KOBLINER: You're learning and you're teaching grownups, too. By doing that , you can teach your parents. I think that's really key. And also sharing. You know? Sometimes if you have a cookie, you give half of it to a friend.

ROMANS: And Cookie, tell me one more time, do you value your cookie more now?

COOKIE MONSTER: Oh, can me see...

ROMANS: Do you value it value it now that you know how to get it...

COOKIE MONSTER: Can me see the cookie? OK, this cookie for sharing, where other cookie? That cooking for saving. It's OK. Give me other cookie. And this cookie for spending or eating.

ROMANS: Yay!

KOBLINER: Yay!

COOKIE MONSTER: Delicious.

ROMANS: Beth Kobliner, thank you so much. And, again, the Sesame Workshop, a fantastic project to get kids really into financial literacy in a fun, fun way.

COOKIE MONSTER: Yeah.

ROMANS: All right, before we go, we want to take a minute to say goodbye and good luck to our good friend and our editorial producer Jennie Brag (ph). Jennie's leaving us to pursue her master's in public health at USC, oh and a stop at Becram (ph) Yoga as a yoga teacher training along the way. We love you, best of luck to you. You helped us put on some fantastic shows.

COOKIE MONSTER: Good luck, Jennie.

ROMANS: Cookie is going to miss you.

Me going to miss you.

Time now to get back to CNN SATURDAY MORNING for a quick check of other stories in the news.