Those who watched Democrats and Republicans in Congress agree last month to extend $858 billion worth of Bush-era tax cuts for another two years could be forgiven for thinking that the federal government is flush with cash. Unfortunately, the recent murmuring on Capitol Hill about cuts of up to $5.7 billion to the Federal Pell Grant Program shows that the fiscal situation remains dire in the wake of the nation’s worst economic contraction since the Great Depression. If Congress follows through on this proposal, then it will create another barrier toward an affordable college education.

Federal Pell Grants are among the most direct and noncontroversial forms of public assistance to low-income individuals. According to the U.S. Department of Education, these benefits are “direct grants awarded through participating institutions to students with financial need who have not received their first bachelor’s degree or who are enrolled in certain post-baccalaureate programs that lead to teacher certification or licensure.” Recognizing the need for additional assistance as incomes declined and tuition rates skyrocketed, Congress voted last year to increase the maximum Pell Grant award to $5,550 from $5,350 for the 2010-11 academic year. Yet faced with an increased number of students qualifying for the Pell Grant, as well as a persistent budget deficit that has many calling for austerity, Congress may now roll back the maximum Pell Grant by more than 15 percent.

Cutting the Pell Grant, however, would be a counterproductive method to reduce the budget deficit. The program’s recipients are overwhelmingly from low-income households, and reductions in financial assistance could force them to forego spending on personal necessities or to take on more debt than they can handle. The former effect could further reduce the likelihood of a strong economic recovery by stifling demand for consumer goods while the latter would create another fragile financial house of cards that could collapse if individuals are unable to pay off their student loans after graduating.

Even worse are the long-term implications of Pell Grant cuts. Students unable to afford tuition costs without the present levels of federal financial assistance may have to drop out of college or forego it altogether, which would drastically reduce their earning potential in the future. This would in turn decrease their expected contribution to the U.S. economy, as well as the amount of revenue that the government would collect from them through taxes.

There are two ways to avoid this dismal outcome. One would be for institution-specific financial aid programs such as AccessUVa to step in and make up for the lost federal assistance. Placing this additional burden upon the backs of colleges is both unfair and impractical, however. At the University, for example, there were 1,667 Pell Grant recipients who collectively received almost $7 million in aid during the 2009-10 academic year. With 16 percent of tuition already dedicated to financing AccessUVa and with continually declining levels of state funding, U. Virginia simply cannot afford to absorb additional obligations of this magnitude. Therefore, Congress must fully finance the Pell Grant Program by either borrowing money or increasing revenue. Neither option is particularly appealing, but Congress must recognize that providing students with the ability to afford a college education is just as important as providing tax relief if the United States hopes to remain a competitive and highly productive economy in the 21st century.