U.S. College Grants Spared From Spending Cuts

Pell grants, which help low-income U.S. students pay for college, have emerged with more money in the deficit-reduction deal signed into law this week, The Wall Street Journal reported Thursday.

Pell grants, which help low-income U.S. students pay for college, have emerged with more money in the deficit-reduction deal signed into law this week, The Wall Street Journal reported Thursday.

The White House and its allies cited the increase when they urged Democrats to vote for the broader legislation, which was almost all about cutting government spending.

It was a rare bright spot for a White House that pushed unsuccessfully for a variety of other provisions, including raising taxes on certain corporations and wealthy individuals, extending a payroll-tax cut, extending unemployment benefits and spending new money on infrastructure in hopes of stimulating the economy.

The deal to raise the government's $14.29 trillion borrowing limit reduces federal spending by $917 billion over 10 years. It also creates a special congressional committee to shrink the government's budget deficit by an additional $1.5 trillion.

The $17 billion increase in Pell-grant spending came at a price, with negotiators paying for it by killing federal subsidies for graduate-student loans. Obama had suggested that tradeoff in his budget, and other negotiators adopted it.

To read more on the Pell-grant program, see The Wall St. Journal article here.

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