I have several problems with this plan proposed by 0bama. First of all, the issue of limited payments to 10% of “discretionary income”, should be something like net income after required taxes withheld. IIRC the discretionary income is whatever is left after paying all the normal bills, rent, cell phones, car payments, etc. The whole program, if subject to this type of pay-back requirement, will necessitate THOUSANDS of federal employees to analyze what people should be paying. The forgiveness clause after X many years, just means that the rest of us who work and pay taxes will have, again, subsidized the loans.
This program is insane.
1. It is a subsidy (even worse than today) for people to take college majors that will never produce income. They have low payments for 20 years and then the principal is forgiven. Essentially, the ACORN/AWS crowd can live on the government teat while they are “students” and then barely pay anything back.
2. Students who make something of their lives pay the whole loan.
3. Students who make something of their lives pay higher interest rates.
4. The burden will end up on the taxpayer and on the students who make something of their lives. The students who take gender studies get a really nice subsidy for six years that will not have to be paid off in full.
Great program.