A few thoughts on community colleges.
In a lot of ways community colleges are the most successful form of "higher ed". Ok, I know your laughing, but stick with me a bit as I make a few points about them.
Most community colleges opened in the years following WWII. Some were created from the ground up, but some were "teacher colleges" (university level schools that only had teaching degrees mainly for women) that were expanded. They were designed for GI's returning from the war. Since most were not ready for university level work (the MUCH higher level of that time).
They were (and many still are) fairly inexpensive.
Many of the students aren't "college age" so you have a wide age range and experience. Many are only taking a class or two in a subject that interests them.
Many are staffed by real people from the place the school is, not people that are only "educators". Many only teach a class or two on a subject that are their real day jobs (like a photographer etc). Those are some of the best classes that can be had at a community college.
They still are the place people go for remedial work. That job has unfortunately gotten a lot bigger and a lot harder. The highly motivated GI's have been replaced by unmotivated people who either blew off high school or went to a lousy one. It has also given community colleges the negative stigma many have.
But I think they largely do what they were intended to do.
Yes, they have low gradation rates. But does that number include people who don't intend (just taking a class or two) to graduate? I imagine some transfer earlier to a four year school too. I don't think few getting the two year degrees (which are generally useless) is a problem that needs to be solved. There is no problem with it being a adult or night school sort of thing. If your not college aged, it may be the only college that will work.
However, I think a program like Obama's will only draw the worst of what is infecting higher education into community colleges. And community colleges have plenty of its own problems, it doesn't need more of them.
If anything, the opposite should occur. Community colleges should be spun off, their tax districts dissolved and the schools privatized. Most would be far better off as private run organizations. They could serve their communities rather then the education department in DC. (I think public four year universities should be spun off and privatized too).