Skip to comments.Student Loan Payroll Tax Increase: Another Attack on Small Business
Posted on 05/21/2012 11:34:19 AM PDT by TribalPrincess2U
President Obama is campaigning heavily for Congress to prevent the lapsing of a special low-interest rate on student loans. Specifically, unless deferred, the interest rate will rise from 3.4 percent to 6.8 percent on federal Stafford student loans issued after July 1, says Curtis Dubay, a senior policy analyst at the Heritage Foundation.
Senate Majority Leader Harry Reid (DNV) has proposed to offset the cost of continuing to subsidize these loans by raising taxes on small businesses to the tune of $9 billion over 10 years. This is the latest in a series of tax increases on small businesses pursued by both President Obama and Reid. It would set a dangerous tax policy precedent that Congress should reject.
(Excerpt) Read more at heritage.org ...
Can someone explain why, if 0bama took over student loans because the banks were being abusive, does it cost money for the government to lower student loan interest rates? If it’s government lending you money to go to school, doesn’t the government just set the interest rate?
Another Obama “Liar liar pants on fire” moment.
I would imagine.
I think the 0 regime are trying to blame the Right for rising interest.
In the 60’s theses were called National Defense Student Loans and were operatied by the govt. Any legislation with Defense in the title was passed.
In the 70’s they retitled these to National Direct student loans. Defense was a bad word, but again, operated by the govt.
in the 80’s because of lobbying and other things these were financed by the govt but managed by banks and other entities.
Which leads us back to now with the govt financing and managing the student loans for political reasons.
What is missing from the article is how long the loan extension is.
The tax increase is 10 years, but is the extension 10 years or only 1 year like his SS payroll tax extension proposal was?
Whatever it is, if it’s a leftist agenda we know it can’t be good.
Does anyone know what the govt receives for these loans compared to other lending.
I like to know the details of what the disagreement is about.
Congressional Republicans have a repeated habit of getting into these fights and not knowing what they are doing (not knowing how to frame a winning argument) only to find out they been taken again, then they cave and flee like rats.
It is a mistake even to call this an interest rate. Interest is the cost of using someone else’s money. The price is set in a free market with people bidding against other potential users of this money.
What we are talking about here is an arbitrarily set sliding fee.
From each according to his ability, to each according to his need.
"... I have no doubt in my mind it is a calculated political move, much like the student loan interest rate was.
And to refresh your memory on that.
In 2007, the Democrats ran everything that year. They ran the House and the Senate, Bush in the White House of course. The Democrats decided to cut the student loan interest rate in half. And then also the Democrats in the House and the Senate voted to restore the student loan interest rate, at its current level, in July of this year, which would have the effect, the impression would be that the student loan interest rate is doubling in July of this year. When all that was happening was, it was being restored to where it was in 2007 when the Democrats cut it.
The Democrats cut it in 2007 and plan to restore it in 2012 as a presidential election issue. They of course couldn't know in 2007 whether the Democrats have the White House or not, but they were pretty confident, given the country hated Bush and the media was drumming up -- they figured it was gonna be Hillary in 2007. So as an insurance policy, they have this student loan interest rate doubling, and of course if they're running the show in 2012, when it goes back up, they can just themselves get rid of it, quietly, no attention being paid to it. But now the news is out, the student loan interest rate's gonna double. The Republicans want your student loan interest rates to increase, when the Republicans have nothing to do with it.
All this while Boehner was actually try to pass legislation to keep the student loan interest rate where it is. Same thing's happening here with unemployment..."
That was smart of them.
Given Republicans record on standoffs like the SS FICA tax cut extension (end of last year) expect some tough words, some huffing and puffing and then Republicans getting scared and then giving Obama whatever he demands.
Notice how after all that fuss the Republicans passed that FICA/SS tax extension with Dems and very quietly so we wouldn't notice?. The silent cave.
“Senate Majority Leader Harry Reid (DNV) has proposed to offset the cost of continuing to subsidize these loans by raising taxes on small businesses to the tune of $9 billion over 10 years. This is the latest in a series of tax increases on small businesses pursued by both President Obama and Reid. It would set a dangerous tax policy precedent that Congress should reject.”
Reid seems to be a bit of a nut, small business can’t afford the tax but even if they could it would be unjust to make them pay for other people’s education.
Frankly its the collages themselves that should be issuing the loans backing their own product.
If the collage’s product is genuinely helpful in making people earn more money in their life then they should have no problem recouping the loan + interest.
If however their product(education) is absurdly over valued then they might see a lot of trouble recouping all the money they charged for it.
Either way collages will finally have an incentive to insure their product actually matches in value what they charge for it. Thus the present moral & economic problem with collages is resolved.
And Obama is campaigning on the idea that HE is a better person to be President because he knows more about business than Romney!!!
Bizarro world, for sure!!