3:54 P.M. EDT
MR. TOIV: We have Bruce Reed and Eli Segal to brief, answer
your questions about the proposal the President announced today.
Bruce is the President's Domestic Policy Advisor. Eli is the
founding CEO of AmeriCorps and currently a board member. And here they are.
MR. REED: Thank you, Barry. Let me explain how this interest
deferment works. What the President announced on "Face The Nation" is that we
will propose legislation as part of the higher education reauthorization later
this summer to enable students who agree to do service to essentially defer
the interest on their college loans during that period of service. The
federal government would pay the costs of the interest during their service.
This option is already available to a number of students who
have subsidized college loans. We are -- the action that we are proposing
would expand it to students who have unsubsidized college loans, which is
about one-third of the college loans all together. Our estimate is that this
proposal would cost about $7 million over the five-year budget window and
provide an average benefit of $600 to approximately 12,000 student borrowers
who agreed to do service.
Q Those numbers again?
MR. REED: $7 million, over five years; 12,000 students,
average benefit $600. I think that adds up.
And the type -- the students would be -- service here would be
defined as working for a tax exempt organization or teaching in low income
Q Do they have to work for free to --
MR. REED: No, no. These are generally low income. But it's
a form of --
Q Is there any income consideration at all?
MR. REED: Well, a couple different ways to repay your loans
if you should decide to go back to college and go into a low income service
profession. Because of what the President
did in 1993, we now have income contingent loans, which any
student could choose. And if you have an income contingent loan
and you go into a low income service profession, you end up not
paying very much interest anyway because it's a percentage of
your income, and if your income is very low you wouldn't have
much to pay.
But this particular provision is for unsubsidized
loans. Many of these people would be earning an income, but it's
a very low income. And so the government is essentially stepping
in, recognizing their economic hardship, paying the interest on
their loan for that period. And then they'll repay the loan once
they go into another profession and are earning the money to pay
Q How long can you defer for? Is there a set --
MR. REED: Up to three years.
Q And it would be $600 a year?
MR. REED: Yes.
Q Are the employees at the Departments of
Transportation and Defense, who are going to do all this
tutoring, is that during work hours and they'll be paid to take,
like, an hour a week or a month to do it?
MR. REED: Different agencies have different
policies on how mentoring and tutoring and volunteering will work
during the work day. It's basically at the agency's option. I
think the law requires that employees can only do paid service
during the work time if it's related to the mission of the
department. So, for example, the Education Department does allow
employees to go and mentor in schools during the work day. And a
lot of other agencies the employees will -- if they mentor for an
hour during the day, they'll make up that hour over the course of
the work week.
Q Bruce, is the loan program primarily, then, for
students coming from upper middle class families if it's for
those who are getting unsubsidized loans?
MR. REED: Middle class.
Q Middle class families?
MR. REED: Yes.
Q And this is a very different kind of program
than AmeriCorps's; does this reflect some kind of changing or
MR. REED: Oh, not at all. This is, in addition to
our continuing efforts to expand AmeriCorps, which has given
50,000 young people the chance to earn substantial college
scholarships in return for full-time service. And as I said,
we've taken other measures to make the cost of college -- to make
borrowing for college easier.
This really just closes a loophole in the law, a
difference between subsidized loans and unsubsidized loans, and
the idea was inspired by Reverend Tony Campolo here in
Philadelphia, a minister who wants to encourage service and
brought this general idea to the President's attention earlier in
Q Why so few opportunities? Twelve thousand over
three years is not very many.
MR. REED: That's just our estimate of the number of
people who would go into service. It could turn out to be higher
if there's a greater response.
Q Could you explain, Bruce, what the President
was referring to in the interview when he talked about -- he
indicated that these would be people supported by their religious
congregations in some way?
MR. REED: I think that -- I may have to get back to
you on the specifics of what Reverend Campolo intends to do.
Q I'm talking about the President's comments in
the interview that he did.
MR. REED: In the "Face The Nation" interview. He
was talking about Campolo. But in general, these are students
who would be doing service with tax-exempt, nonprofit
organizations. It could be religious organizations, it could be
teaching in low-income as I said, and if they're making a salary,
it would be provided by the organization they work for.
Q Bruce, let me just get this straight. So the
government would pay the interest, correct?
MR. REED: Yes.
Q For the student loan?
MR. REED: Yes.
Q You say for up to three years?
MR. REED: Yes.
Q And --
MR. REED: Because this is a loan deferment, so it's
not paying down the principal on the loan, it's just paying the
interest over the period while the loan is being -- while
repayment of the loan is being deferred.
Q Secondly, the other question, which I can't
remember right now. I'll get back to you --
Q How is he proposing this, exactly? This is
going up in what form to Congress? Or is this part of the budget
MR. REED: This summer we will propose
reauthorization of the Higher Education Act, and it will include
a provision on this, so this is something that would impact with
the FY '99 budget.
Q And do you have any support in Congress for
this already, Bruce?
MR. REED: No, just proposing this idea, and the
legislation would go forward sometime in early summer.
Q Do you think you have any support in Congress
for this kind of legislation?
MR. REED: I can't say for sure, but I think this is
the sort of idea that would be relatively noncontroversial and
could attract bipartisan support.
Q On the announcement today about the Department
of Defense and Transportation tutoring, do you have any idea what
the baseline is between how many they tutored in the last four
MR. REED: Do you know?
MS. FORTUNA: No, I don't. I don't have a clean
baseline. They probably do 600,000 at the Navy; I don't know how
many in the Army.
MR. REED: So the incremented Navy is 100,000.
MS. FORTUNA: One hundred thousand a year. And I
don't know about transportation.
MR. REED: James, you probably have an early
deadline, but what Diane has said was that they already have --
the Defense Department already has a magnificent mentoring and
tutoring program, and I believe that the Navy already mentors
something like 600,000 a year, and they're committing to increase
that to 700,000.
Q This is for full-time volunteering, full-time
MR. REED: No, The Defense Department or the other one?
Q No, I'm sorry, I'm back to the other, the
MR. REED: Yes, these would be people who are doing
this as a profession.
Q Can you give us any idea for how many more
children will be tutored as a consequence of what the President
said today than were tutored in the last four years, or do we
have any notion for what difference this actually makes?
MR. REED: Well, as I said, it's 100,000 additional
children as a result of what the Navy is doing. I believe that
the Department of Transportation initiative is a completely new
initiative. So --
MS. FORTUNA: It's not only tutoring, it's tutoring,
mentoring, education --
MR. REED: But it involves tutoring, mentoring and
some kind of education efforts as well. I think you'd be safe to
say our hope is that it would help upwards of a million more
children than otherwise would have gotten help.
Q Did those departmental staffers or workers do the
mentoring and tutoring on their own time or on government time?
MR. REED: Well, as I said earlier, agencies have
the option of either giving time off during the work day to go do
this on a paid basis if it's related to the mission of their
department. But in most cases, these are employees who take an
hour during the work day and then make it up elsewhere during the
Q Bruce, several of the corporations who are
represented here say they've got people who are coordinators for
the companies to help make it easier for employees to know what's
out there as far as community service. Does the White House have
such a thing or is it contemplating it?
MR. REED: For the administration as a whole or just
within the White House?
Q In the White House.
MR. REED: We don't have one now, John.
Q All right. Is there any possible -- or a
contemplation of on-site volunteer opportunities? That's another
thing that the corporations were touting.
MR. REED: Well, that is something that works --
something that works very effectively in the private sector. And
some of the agencies may be looking at that -- in other words,
bringing the kids to the sites. We don't have that in mind at
the White House. They'd have to stand in line a long time at
Q They might be foreigners, in which case they
would take a long time at the gate. (Laughter.)
Q Bruce, can you tell us anything about what else
was happening this afternoon away from the stadium? I mean, were
the other Presidents also out cleaning up trash and painting over
MR. REED: I think everybody had on t-shirts and was
out painting. I don't know which color t-shirts they were
wearing or whether they were using the same color of paint, but
all the principals were taking part in the effort.
MR. TOIV: Any AmeriCorps questions? Any related
Q Did you talk -- I just walked in, I'm sorry. Did
you talk about what dollar figure on average we're talking about
these kids saving if they volunteer for a year?
MR. REED: As a result of the President's income
--loan deferment proposal, it's an average benefit of $600.
AmeriCorps, which is -- well, Eli can talk about better than I
can, but AmeriCorps gives college scholarships of $4,725 in
return for a year of full-time service.
MR. TOIV: Is that it?
Q I have a question for Eli. Is -- the mood of
this summit seems to be very pro-volunteering and kind of not pro
the kind of AmeriCorps service that's paid for and is somewhat
expensive. Do you think that in the end it will be hard on
AmeriCorps -- that Americans will start thinking, well, we have
all these new volunteers. We don't need AmeriCorps anymore?
MR. SEGAL: On the contrary, Elizabeth, I see this
as a logical extension of AmeriCorps. AmeriCorps was built on
several principles. One of them was the idea of public-private
partnerships. Through the life of AmeriCorps -- three years --
we have seen extraordinary commitments in the private sector
already. In its first year alone, there's an audited report
which shows more than $40 million committed by the private
sector, usually in the form of cash, to support the AmeriCorps
programs in the United States. This kind of ramps it up one
level more, continues to make the case that AmeriCorps plays a
vital role. Certainly, you will see lots of young people in
AmeriCorps here in Philadelphia. They're in lots of the
And we believe that all people recognize that
volunteerism -- we're not going to simply celebrate volunteerism
this week, but we have to rely on volunteers more than we have in
the past. And it's unquestionably the case that AmeriCorps is
the crucial link or at least one of the crucial links in making
volunteers operate more effectively. We're awfully proud in
AmeriCorps of the fact that for every one AmeriCorps who serves,
there are 12 new volunteers. It's the reason why some of the
great volunteer organizations, from the American Red Cross to
Habitat for Humanity, are such extraordinary supporters of our
MR. REED: Thank you very much.
THE PRESS: Thank you.