Posted on 06/16/2014 6:46:45 AM PDT by YourAdHere
For the millions of Americans encumbered with college debt, relief was snatched away this week when Capitol Hill Republicans blocked measures that would have allowed borrowers to refinance their loans.
House and Senate Republicans on June 11 stymied progress of the Bank on Students Emergency Loan Refinancing Act, which would have allowed borrowers with college loans issued prior to 2010 to refinance at 3.86 percent—the rate established by Congress last year.
The White House, which supported the legislation, said the bill could have allowed an estimated 25 million student loan borrowers to save an average of $2,000 over the life of their loans. The measure would have been paid for by enforcing the Buffet rule—closing tax loopholes for the very rich.
“This should be a no-brainer,” President Obama said June 9 during a press conference to announce executive actions to make college more affordable. “It would be scandalous if we allowed those kinds of tax loopholes for the very, very fortunate to survive while students are having trouble just getting started in their lives.”
Sponsors of the bill said they had received bipartisan support, but Republicans seemed to balk at the means of finance.
“Today is a really good day for billionaires,” Sen. Elizabeth Warren (D-Mass.), one of the sponsors of the bill, said at a press conference after the vote. “For the more than 40 million people dealing with student loan debt it wasn’t such a good day.”
“The Republicans have said they don’t like how it being paid for—closing tax loopholes on millionaires and billionaires,” she added. “If they have an alternative plan then bring it forward. That’s what we’ve asked for.”
“We’re not giving up,” she said. “Homeowners are refinancing. Small businesses are refinancing. We just want young people who got an education to have their shot.”
The legislation was introduced amid growing public concern about the toll of student loans on the economy.
Over the past three decades, the average tuition at a public four-year college has more than tripled, while a typical family’s income has barely moved. As costs rise, more students than ever are relying on loans to pay for college. Today, 71 percent of those earning a bachelor’s degree graduate with debt, which averages $29,400 per student. Outstanding student loans now total more than $1.2 trillion, surpassing total credit card debt, according to a White House report.
On June 9, President Obama signed an executive order that allows about 5 million more borrowers—those who took out loans before 2007—to cap their monthly payments at 10 percent of their incomes, among other measures intended to address the problem.
“At a time when higher education has never been more important, it’s also never been more expensive,” Obama said. “If somebody plays by the rules, they shouldn’t be punished for it.”
Apparently Stafford Loans are going as high as 7% this year. I didn’t realize how lucky I was to have one at 3.625.
Save $2,000 over the life of the loan!? What a joke!
Not the first, but the second.
Exactly.
If only he thought that way about illegal immigration.
Fantastic point, Colonel.
Rules are, you agree to the loan then you pay it back. Them's the rules. No punishment for playing by the rules, just for breaking them. Obama is an idiot, more so than most idiots.
Wise words! Long ago when I attended college, I had a paying job to tutor math to students having problems. They were taking algebra, geometry and trigonometry but they didn't understand basic arithmetic! I spent most of my time teaching them math basics they should have learned in middle school. No business being in college, but they wanted to be there since they were told they need a degree.
I see the same thing now. Kids want a degree, but don't have the prerequisite knowledge to study at the college level. Hence they gravitate towards a useless field of study. These kids should just hit the job market and skip college, and not waste money on a college loan. In time, as they mature they can decide whether to attend classes to further their career. I have several nieces and nephews who wasted time in college for many years, a couple of them with large loans that are sinking their broke parents.
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