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Obama Speaks on Education; Closing Arguments in Ft. Hood Shooter Trial.

Aired August 22, 2013 - 11:30   ET


BARACK OBAMA, PRESIDENT OF THE UNITED STATES: New York's done better than a lot of states but the fact is that we've been spending more money on prisons, less money on college.


OBAMA: And meanwhile not enough colleges have been working to figure out, how do we control costs. Do we cut back on costs? So all this sticks it to students, sticks it to families, but also taxpayers end up paying a bigger price. The average student who borrows for college graduates owing more than $26,000. Some owe a lot more than that. And I've heard from a lot of these young people who are frustrated that they've done everything they're supposed to do, got good grades in high school, applied to college, did well in school, but now they come out they've got this crushing debt that's crippling their sense of self-reliance and their dreams. It becomes hard to start a family and buy a home if you're servicing a thousand dollars worth of debt every month.


ASHLEIGH BANFIELD, CNN ANCHOR: We'll keep watching the president as he makes his remarks. Doesn't matter what your politics are. It's the single biggest worry that I have. In about 10 years, I'll be facing those big costs. A lot of people feel the same way. College is terrifying if you're a parent. If you have children, several children, good luck.

The president is not just stopping at the University of Buffalo. He's got a couple other stops. He'll be in Syracuse at a high school. And guess what, we are thrilled that our own Chris Cuomo snagged the big interview. We'll do a sit-down with President Obama for an in-depth interview to discuss exactly this, higher education. He'll also discuss national security and international affairs with what's going on in Syria right now. That's going to be critical. You can watch this one-on-one interview. The discussion is tomorrow morning on our brand-new "New Day," morning program begins 6:00 a.m. eastern time. Encourage you to watch.

So the man who's admitted to shooting and killing a lot of these colleagues in Ft. Hood, Texas, is acting as his own lawyer in his murder trial. Exactly what kind of closing argument would a man like this give in defense of himself? Or do you suspect he has no interest in defending himself at all? That's next.


BANFIELD: All right. For all you Atticus Finch fans, opposing arguments are just about to start in the trial of Army Major Nidal Hasan. He's on trial for killing 14 of his group at Ft. Hood.

Our Ed Lavandera is live.

Ed, he did not present a defense or call witnesses. I'm curious as to whether he's allowed to say the things we expect he wants to say in the closing that he is allowed to give. Is he?

ED LAVANDERA, CNN CORRESPONDENT: That's what we're anticipating here. Yesterday was extremely anti-climactic. There were two witnesses put on his witness list, he dismissed those and when the judge asked him to present his case, he immediately said "the defense rests." No witnesses, no semblance of any kind of defense or trying to figure out, you know, he knows exactly he is going to do. Closing arguments are about to begin. Last time during opening statements prosecutors took about an hour. Nidal Hasan made some brief statements that lasted about a minute or so. It will be interesting to see if Nidal Hasan says anything. Obviously, presumably, this will move on to the punishment phase after this jury finds him guilty. That Nidal Hasan has already admitted to being the shooter. The question is for this jury to go over the instructions and the sheet they will have to determine exactly which charges he would be convicted of. Obviously, assuming that at this point he will be convicted. That's what the judge in this case has been going over throughout most of the morning is a long, complex sheet the jury must go over to determine exactly what charges he'll be convicted of.

BANFIELD: So curious, 13 of his military peers, as well, here, and if he doesn't get to say what he wants to say now in closing I bet you in any kind of potential sentencing phase he could do exactly what he wants to say and that is make me a martyr, which most people believe he wants to do in this slow road to judicial suicide, as Jeffrey Toobin puts it.

Ed, I'm going to cut you off because I've got the president live, so I'm going to come back to you if I can.

In the meantime, back to University of Buffalo. Let's listen in.


Our economy can't afford the trillion dollars in outstanding student loan debt, much of which may not get repaid because students don't have the capacity to pay it. We can't price the middle class and everybody working to get into the middle class out of a college education. We're going to have to do things differently.

We can't go about business as usual, because if we do, that will put our younger generation, our workers, our country at a competitive disadvantage for years. Higher education is still the best ticket to upward mobility in America, and if we don't do something about keeping it within reach, it will create problems for economic mobility for generations to come. And -- and that's not acceptable. (APPLAUSE)

So whether we're talking about a two-year program, a four-year program, a technical certificate, bottom line is, higher education cannot be a luxury. It's an economic imperative. Every American family should be able to afford to get it.


So -- so that's the problem. Now, what are we going to do about it? Today, I'm proposing major new reforms that will shake up the current system, create better incentives for colleges to do more with less, and deliver better value for students and their families. (APPLAUSE)

And some of these reforms will require action from Congress, so we're going have to work on that.


Some of these changes I can make on my own.


We are going to have to...


We're going to be partnering with colleges to do more to keep costs down. And we're going work with states to make higher education a higher priority in their budgets.


OBAMA: And one last thing: We're going to have to ask more of students who are receiving federal aid, as well. And I've got to tell you ahead of time, these reforms won't be popular with everybody, especially those who are making out just fine under the current system.

But my main concern is not with those institutions. My main concern is the students those institutions are there to serve, because this country is only going to be as strong as our next generation. And I've got confidence...


I have confidence that our -- our country's colleges and universities will step up, just like, you know, Chancellor Zimpher and the folks at SUNY are trying to step up and lead the way to do the right thing for students.

So let me be specific. My plan comes down to three main goals. First, we're going to start rating colleges, not just by which college is the most selective, not just by which college is the most expensive, not just by which college has the nicest facilities. You know, you can get all of that on the existing rating systems.

What -- what we want to do is rate them on who's offering the best value so students and taxpayers get a bigger bang for their buck.


Number two, we're going to jump-start new competition between colleges, not just on the field or on the court, but in terms of innovation that encourages affordability and encourages student success and doesn't sacrifice educational quality. That's going to be the second component of it.


And the third is, we're going to make sure that if you have to take on debt to earn your college degree, that you have ways to manage and afford it.


So -- so let me just talk about each of these briefly. Our first priority is aimed at providing better value for students, making sure that families and taxpayers are getting what we pay for.

Today I'm directing Arne Duncan, our secretary of education, to lead an effort to develop a new rating system for America's colleges before the 2015 college year. Right now, private rankings, like the U.S. News and World Report puts out each year their rankings, and it encourages a lot of colleges to focus on ways to -- how do we game the numbers? And, you know, it actually rewards them in some cases for raising costs. I think we should rate colleges based on opportunity. Are they helping students from all kinds of backgrounds succeed? And...


And on outcomes, on their value to students and parents. So that means metrics like, how much debt does the average student leave with? How easy is to pay off? How many students graduate on time? How well do those graduates do in the workforce?

Because the answers will help parents and students figure out how much value a college truly offers. There are schools out there who are terrific values, but there are also schools out there that have higher default rates than graduation rates. And taxpayers shouldn't be subsidizing students to go to schools where the kids aren't graduating. That doesn't do anybody any good.


And our ratings will also measure how successful colleges are at enrolling and graduating students who are on Pell Grants. And it will be my firm principle that our ratings have to be carefully designed to increase, not decrease, the opportunities for higher education for students who face economic or other disadvantages. (APPLAUSE)

So, you know, this is going to take a little time, but we think this can empower students and families to make good choices. And it'll give any college the chance to show that it's making serious and consistent improvement. So they may not -- a college may not be where it needs to be right now on value, but they'll have time to try to get better.

And we want all the stakeholders in higher education -- students, parents, businesses, college administrators, professors -- to work with Secretary Duncan on this process. And over the next few months, he's going to host a series of public forums around the country to make sure we get these measures right. And then, over the next few years, we're going to work with Congress to use these ratings to change how we allocate federal aid for colleges. We are going to deliver on a promise I made last year.


We're going to deliver on a promise we made last year, which is, colleges that keep their tuition down and are providing high-quality education are the ones that are going to see their taxpayer funding go up. It is time to stop subsidizing schools that are not producing good results and reward schools that deliver for American students in our future.


And we're also going to encourage states to follow the same principle. Right now, most states fund colleges based on how many students they enroll, not based on how well those students do or even if they graduate. Now, some states are trying a better approach. You got Tennessee, Indiana, Ohio, they're offering more funding to colleges that do a better job of preparing students for graduation and a job.

Michigan is rewarding schools that keep tuition increases low, so they're changing the incentive structure. And I'm challenging all states to come up with new and innovative ways to fund their colleges in a way that drives better results.


Now, for the young people here, I just want to say that just as we're expecting more from our schools that get funding from taxpayers, we're going have to expect more from students who get subsidies and grants from taxpayers. So...


So we're going to make sure students who receive federal financial aid complete their courses before receiving grants for the next semester. You know, we're...

(APPLAUSE) We'll make sure to build in flexibility so we're not penalizing disadvantaged students or students who are holding down jobs to pay for school. Things happen. But the bottom line is, we need to make sure that if you're getting financial aid, you're doing your part to make progress towards the degree. And, by the way, that's good for you, too, because if you take out debt and you don't get that degree, you are not going to be able to pay off that debt, and you'll be in a bind.


So -- all right. Second goal, we want to encourage more...



OBAMA: Thank you. Second thing we want to do is to encourage more colleges to embrace innovative new ways to prepare our students for a 21st-century economy and maintain a high level of quality without breaking the bank, so let me talk about some alternatives that are already out there. Southern New Hampshire University gives course credit based on how well students master the material, not just on how many hours they spend in the classroom. So the idea would be, if you're learning the material faster, you can finish faster, which means you pay less, and you save money.


You know, the University of Wisconsin is getting ready to do the same thing. You've got Central Missouri University. I went there, and they've partnered with local high schools and community colleges so that their students can show up at college and graduate in half the time because they're already starting to get college credits while they're in high school or while they're in a two-year college, so by the time they get to a four-year college, they're saving money.


Universities like Carnegie Mellon, Arizona State, they're starting to show that online learning can help students master the same material in less time and often at lower cost. Georgia Tech, which is a national leader in computer science, just announced it will begin offering an online master's degree in computer science at a fraction of the cost of a traditional class, but it's just as rigorous and it's producing engineers who are just as good.

So a lot of other schools are -- are experimenting with these ideas to keep tuition down. They've got other ways to help students graduate in less time at less cost while still maintaining high quality. The point is, it's possible. And it's time for more colleges to step up with even better ways to do it. And we're going to provide additional assistance to states and universities that are coming up with good ideas.

Third thing, even as we work to bring down costs for current and future students, we've got to offer students who already have debt the chance to actually repay it.


You know, nobody wants to take on debt, especially after what we've seen and families have gone through during this financial crisis. But taking on debt in order to earn a college education's always been viewed as something that will pay off over time. We've got to make sure, though, that it's manageable.

As I said before, even with good jobs, it took Michelle and me a long time to pay off our student loans. While we should have been saving for Malia and Sasha's college educations, we were still paying off our own. So we know how important it is to make sure debt is manageable, so that it doesn't keep you from taking a job that you really care about or getting married or buying that first home.

And there's -- you know, there are some folks who've been talking out there recently about whether the federal student loan program should make or cost the government money. Here's -- here's the bottom line: Government shouldn't see student loans as a way to make money. It should be a way to help students.


So we need to ask ourselves, how much do federal student loans cost students? How can we help students manage those costs better? Our national mission is not to profit off student loans. Our national mission must be to profit off having the best educated workforce in -- in the world. That should be our focus.


So as I mentioned a little bit earlier, two years ago, I capped loan repayments at 10 percent of a student's post-college income. We call it pay-as-you-earn. And it, along with some other income-driven repayment plans, have helped more than 2.5 million students so far.

But there -- there are two obstacles that are preventing more students from taking advantage of it. One is that too many current and former students aren't eligible, which means we've got to get Congress to open up the program for more students and we're going to be pushing them to do that.

The other obstacle is, is that a lot of students don't even know they're eligible for the program. So starting this year, we're going to launch a campaign to help more borrowers learn about their repayment options and we'll help more student borrowers enroll in pay- as-you-earn. So, you know, if you went to college, you took out debt, you want to be a teacher, and starting salary for a teacher is, you know, let's say $35,000, well, only 10 percent of that amount is what your loan repayment is.

Now, if you're making more money, you should be paying more back. But that way, everybody has a chance to go to college, everybody has a chance to pursue their dreams. And that program is already in place. We want more students to take advantage of it. We're really going to be advertising it heavily.

Now, if we move forward on these three fronts -- increasing value, encouraging innovation, helping people responsibly manage their debt -- I guarantee you, we will help more students afford college. We'll help more students graduate from college. We'll help more students get rid of that debt so they can get a good start in -- in their careers.


But it's going to take a lot of hard work. The good news is, from what I hear, folks in Buffalo know something about hard work.


Folks in America know something about hard work.


And we've come a long way together these past four years. We're going to keep moving forward on this issue and on every other issue that's going to help make sure that we continue to have the strongest, most thriving middle class in the world. We're going to keep pushing to build a better bargain for everybody in this country who works hard and everybody who's trying to get into that middle class. We're going keep fighting to make sure that this remains a country where if you work hard and study hard and are responsible, you are rewarded, so that no matter what you look like and where you come from, what your last name is, here in America, you can make it if you try.


Thank you very much, everybody. God bless you. God bless America.



BANFIELD: Rousing reaction from the kids behind him at the University of Buffalo, the president on his first stop in a two-day stop, two places in New York today, and all of it education based and cost, the rising costs of secondary education and there is a lot to what he has said, and there is a lot to what students have to do with what he said as well.

Our chief business anchor, Christine Romans, and host of "Your Money," joins me now.

I wasn't kidding when I said earlier I am so afraid of what's going to happen to me in 10 years with a 6 and 7-year-old child facing the cost of college, and more afraid of this than I am of housing

CHRISTINE ROMANS, CNN CORRESPONDENT: Tuition can't keep going up the way it is going up. One of the big points here is schools have to be accountable for rising tuition and for the product that they are selling, and that the kids are investing in this product and they have to be able to get jobs on the other end. Talking about you know giving ratings by the 2015 school year so that a student who is taking out loans knows what kind of investment, what kind of return on investment they will get and also talking about holding students accountable, too, for example, if you haven't completed the course work, you won't get the next batch of loans to keep going, keeping kids on track, too and we have seen this how many times when kids take out loan after loan after loan after loan and in the end it is five years in and they haven't graduated or completed the right course work.

The most important thing about this whole student loan disaster, which is we have too much student debt and too many families are taking on too much debt and a parents savings is about 27 percent of the whole school cost and families aren't saving as much because they can't afford it. The tuition is rising so much. We have to save more and give more scholarships and we have to keep the tuition from rising so quickly.

BANFIELD: He said some of those changes I can do on my own when is code word for executive order a lot of times and that is going to be to those out there saying free enterprise, colleges, too, they need to make money and this won't sound good.

ROMANS: Mark Rehnquist that writes about this, he helps students navigate this, key parts of the president's proposal such as tying federal aid to institutional performance will require an act of Congress. This will not happen in the current divided Congress.

BANFIELD: OK. You and I are out of time unfortunately. I can go on with you forever. You get it.

ROMANS: Keep talking about it. Families are really worried about this. They should be. The president trying to make a part of his legacy, I think, to try to find a way to fix it.

BANFIELD: Good point.

Christine Romans joining us.

And Chris Cuomo will talk to the president tonight. We'll have that on "NEW DAY," and make sure you tune in. The big interview tomorrow, and this will be tough on Chris Cuomo's list of questions for sure.

Thank you for joining us. Flat out of time. AROUND THE WORLD starts after this short break. I'm Ashleigh Banfield.


SUZANNE MALVEAUX, CNN ANCHOR: The United Nations under growing international pressure to act in Syria. Opposition groups say more than 1300 people are dead in what they call a massacre in the Damascus suburbs.

MICHAEL HOLMES, CNN ANCHOR: And in Egypt, former President Hosni Mubarak is out of prison. That does not mean he's free.

MALVEAUX: Plus, here's something we did not see coming.