Praising U-M for its efforts to cut costs, President Barack Obama unveiled a higher education plan for the nation that included increased funding for universities that keep tuition affordable and provide value.

“Here at Michigan, you’ve done a lot to find savings in your budget. We know this is possible. So from now on, I’m telling Congress we should steer federal campus-based aid to those colleges that keep tuition affordable, provide good value, serve their students well,” Obama said during an appearance Friday at U-M.

“We should push colleges to do better. We should hold them accountable if they don’t.”

The visit, which took place before 4,000 people at the Al Glick Field House, was Obama’s second trip to U-M as president. He delivered the Spring Commencement address at Michigan Stadium in 2010.

On Dec. 16, President Mary Sue Coleman sent an open letter to Obama calling for elected officials, university presidents, business leaders, philanthropists and parents to collaborate on making higher education affordable for all.

Coleman said U.S. policy officials promptly contacted her after receiving the correspondence.

“I think my letter came at just the right time,” she said.

Noting student loan debt now has surpassed credit card debt for the first time, Obama outlined current changes that include increased financial aid for students, in the form of more grants and lower rates on loans.

The president also introduced the idea of a “report card” that would allow parents and students to know how a college is doing in terms of affordability and student performance.

“I want to make sure young people understand the financing of college,” he said. “This is so consumers of higher education understand what they are getting.”

Obama also said states need to make higher education a better budget priority.

Echoing messages in his State of the Union address delivered three days earlier, Obama told the crowd, “Higher education is not a luxury, it is an economic imperative.”

He noted, “By far, we have the best network of colleges in the world.”

Access to higher education is essential if the nation is to move forward, he said.

“This is going to be one of the most important issues that not just you face, but this entire country faces:  How can we make sure that everybody is getting the kind of education they need to personally succeed but also to build up this nation — because in this economy, there is no greater predictor of individual success than a good education,” Obama said.

“The idea that if you work hard, if you are applying yourself, if you are doing the right thing, you can do well enough to raise a family and own a home and send your own kids to college, put away a little for retirement, create products or services — be part of something that is adding value to this country and maybe changing the world.  That’s what you’re striving for. That’s what the American Dream is all about.”

Keeping education accessible is a personal issue for Obama and his wife, Michelle.

“We didn’t come from wealthy families. The only reason that we were able to achieve what we were able to achieve was because we got a great education. That’s the only reason,” he said. “The point is, this country has always made a commitment to put a good education within the reach of all who are willing to work for it, and that’s part of what helped to create this economic miracle and build the largest middle class in history.”

Coleman said she was pleased with Obama’s talk, and thought he truly understood the economic obstacles educational institutions face in Michigan.

“He really pointed what needs to be done in the future, so it was very inspiring for me,” she said.

Coleman said she was glad to hear the president talk about state disinvestment in college funding, something not unique to Michigan. She pointed out that U-M has been proactive in looking for ways to keep tuition affordable to offset a steady and dramatic cut in state funding.

To that end, the university has cut $235 million in recurring costs out of the budget through lowered energy costs, better space utilization, greater employee cost-sharing in benefits and increased use of generic pharmaceuticals among employees covered by U-M’s health plan, said Provost Phil Hanlon.

In discussing his blueprint for the economy, Obama said Michigan is a leader in the nation for its manufacturing. He also mentioned Michigan’s auto industry — once on the verge of collapse —that now rebounds.

“Some left it to die, and we said, ‘No,’” Obama said. “We believe in this state. And now the auto industry is back.”

Rebuilding manufacturing and investing in technology will be critical to America’s success, he said. “When manufacturing does well, the entire economy does well,” Obama said. “We need to make sure America not only builds stuff but that we are also selling stuff.”

Obama also emphasized the need to move away from dependence on foreign oil, and refocus on clean, renewable energy, such as wind, solar power and biofuels. “It’s good for our economy and creating jobs, and it’s also good for our environment,” he said.

At the beginning of his speech, Obama fired up the crowd, saying he was glad to be back in Ann Arbor, and congratulating U-M on its Sugar Bowl victory and the success of its basketball team. He also gave a shout-out to U-M quarterback Denard Robinson, who was in the audience, prompting someone in the crowd to shout that Robinson should be “drafted” for president.

“He’s got to graduate before he can run for president,” Obama joked. “There’s an age limit.”

In remarks prior to the speech, DeAndree Watson, president of the Central Student Government, praised the president for investing in his generation.

“Higher education is not a luxury or a bonus, but a prerequisite to future success,” Watson said. “If we didn’t live in a country that invested in higher education, I wouldn’t be here today.”

U-M sophomore Emily Cummings of Cary, Ill., said she was interested in what Obama had to say about higher education.

“Coming from a small town, I don’t get opportunities like this,” Cummings said. “I think it’s really cool. It’s really important for all of us.”

Alec Lessner, a sophomore from Philadelphia, was one of thousands of students who camped out overnight to get his Obama tickets and said it was well worth the wait.

“It’s very rare to see the president speak, and the topic is relevant to out-of-state students like me,” said Lessner, a history and history of art major. “This opportunity doesn’t come every day.”

Obama left the crowd with a message of hope.

“You inspire me,” he said. “You’re here at Michigan because you believe in your future. 

“You’ve got the whole world before you. And you embody that sense of possibility that is quintessentially American. We do not shrink from challenges. We stand up to them. And we don’t leave people behind; we make sure everybody comes along with us on this journey that we’re on.”

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