Obama's Plan for Student Loan Relief, Or Is It?
Recent college graduates and current students will benefit most from job opportunities and reasonably-priced education, not college loan relief that won't reach everyone. Even worse, the president's recently proposed loan relief has a chance of increasing already bloated tuition and fees that now top $8,000 a year at public colleges and universities.
President Barack Obama has proposed a complex plan to provide limited student loan debt relief, in a clear response to Occupy Wall Street concerns. But the Education Finance Council, the national consortium of nonprofit student loan providers and state student loan agencies, says the proposal is too little, too late and will not provide real relief to graduates struggling to repay hefty college loans in today's weak job market. According to the Education Finance Council, many people with student loans taken out between 2006 and 2009 will not benefit from this plan at all and might even see their payments increase.
The Obama administration seems to be focusing on surface features of current complaints about student loans while perhaps exacerbating underlying problems. The plan also appears to be more about public appearance than substance, as most of the proposal merely moves provisions of an already-approved congressional student loan plan from 2014 to next year. Some news reports say the president is proposing this plan to woo young voters, as he slams congressional Republicans and says, "We can't wait."
Many recent graduates won't be eligible for the loan relief and will continue in their current programs, subject to interest rate increases already built into the system. When notices are issued that monthly repayment amounts will increase, I wonder how many of these will be issued in December, not November, 2012.
Photo Credit: David Michael Morris