As the 2009-1010 school year gets underway, President Barack Obama and Education Secretary Arne Duncan have been making strong moves to ensure that American higher education remains competitive in the 21st century economy. Commentary has focused on Obama and Duncan’s plans to extend the school year to match the time foreign counterparts spend educating their children—after all, in the last decade, the US has fallen from first to 10th among nations in its percentage of college graduates.

Speaking at the Hudson Valley Community College in Troy, New York early last week, the president summed up these concerns:

One silver lining amid this news is the House of Representatives’ recent passage of the direct student loan program. According to Congress Matters, Obama’s new plan begins by:

Obama’s plans were lauded by education watchers from Bill Clinton to Randi Weingartner. But funding aside, the higher education delivery system itself may need reform. Much has been written about whether American students are being well-served by expensive, private four-year colleges. In this climate of decline, students are increasingly voting with their feet, attending less expensive state schools and vocational schools with quality teaching that might not leave them with crippling debt.

The Washington Monthly has recently released a new type of college ranking—to counter the standard U.S. News and World Report metrics—that emphasizes the money spent on Pell Grants per student, number of students performing national service, and other less traditional measures. Under their system, the top three universities in America are the University of California at Berkeley, San Diego, and Los Angeles—all state schools.

The new tuition-for-service paradigm, paired with skyrocketing costs for private colleges, may completely change the type of education that young students of tomorrow seek. But today, even public schools can be expensive for families struggling through recessionary times. The asset-building program at the New America Foundation has some useful analyses for families that have been hammered by market fluctuations:

The student loan reforms may soon be undergirded by a proposed Consumer Financial Protection Agency, a type of catchall financial literacy and watchdog agency that was recently endorsed by former Federal Reserve chairman Alan Greenspan. The vote of confidence (even from a man whose economic policies have been sorely discounted since September 2008) could help the agency get off the ground—but in the meantime, Obama's strong intervention into both markets and into education are welcome.

—DAYO OLOPADE