Bush Would Pay for Pell Grant Increase With Cuts in Lender Subsidies and Supplemental Grants Program

By KELLY FIELD

Washington

Last week, higher-education lobbyists got the good news on President Bush's proposed budget for the Education Department in 2008. He would increase spending on the maximum Pell grant to $5,400 over the next five years.

On Monday, they got the bad. He would pay for it by cutting lender...