This report of a regional hearing on education considers the Federal role in education and, specifically, how Federal budget cuts will affect both school programs and major national problems such as declining productivity, inflation, social tensions, budget deficits, and challenged world leadership. Testimony was heard from representatives of the educational community from Louisiana, Mississippi, Tennessee, Texas, Alabama, West Virginia, California, Wisconsin, and Illinois. Those testifying discussed, in detail, the impact of various budget cuts on their states' educational programs and policies. Issues of taxes, teacher education, school lunches, educational equity, vocational training, migrant education, and other concerns were considered, with reference to the impact of proposed Federal cuts in educational spending. Transcripts of testimony as well as prepared statements, letters, and other supplemental materials are included. (CG)