With current student loan interest rates set to double in July without government intervention, both politicians and students have thrust the issue into the national spotlight.
While the issue has divided both major political parties, the possibility of an increase from the current 3.4 percent rate has prompted students to protest against student loan debt as politicians have begun to recognize it as a hot button issue.
The U.S. House of Representatives’ Friday passage of a $5.9 million Republican bill to extend the current rate on Stafford loans already faces veto threats from President Barack Obama, and it appears unlikely that the parties will pass extensions without a compromise.
But students hoping to nudge politicians into making a decision about the issue have organized protests against student loan debt in response to the possibility of a rate increase. Wednesday’s $1 Trillion Day of Action — named after the aggregate amount of loan debt accrued by college students — saw students from around the country gather to protest the issue, including students from UC Santa Cruz.
“Student debt is honestly completely out of control in this country,” said UC Santa Cruz student Maria Jennings, who participated in the Wednesday protests, in an email. “The fact that it’s exceeded one trillion dollars is just another slap in the face to students who are racking up these unbelievably high amounts of debt to get an education.”
Jennings said the campus’ Student Labor Action Project — an organization based around challenging institutions that perpetuate economic and social injustice — visualized the massive scope of the issue by putting together a 250 foot long paper thermometer illustrating the debt’s size.
In April, the UC Berkeley chapter of CALPIRG took similar action by participating in a national day of action against student loan debt in the hopes of bringing the issue to the attention of California politicians.
Now, recognizing the massive effect the rate increase would have on students, politicians at the national level have spoken out strongly in favor of extending the current rate. Obama appeared on “Late Night with Jimmy Fallon” Tuesday night to perform a “slow jam” with the television host urging the American public to back the rate extension.
But Republican presidential frontrunner Mitt Romney’s campaign contends that Obama’s focus on the issue has not translated into what college students really want — jobs.
“With one of every two recent college graduates unemployed or underemployed, President Obama won’t be able to skate by on empty rhetoric and campaign promises — he’ll have to run on his failed record of high unemployment, skyrocketing gas prices, and mountains of new debt,” said Romney spokesperson Amanda Henneberg in a press release.
Still, the issue currently remains politically deadlocked. On May 8, U.S. Senate Democrats will vote on legislation that would extend the current rate by closing Medicare tax loopholes for Americans making over $250,000 annually.
Damian Ortellado is the lead higher education reporter.
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Its not the banks fault prices are so high, its the government fault for insuring every student loan that banks make. Why should universities lower their prices when they know government insured loans will always foot the bill.
and plus, you were never forced to take that loan, deal with it
This sucks: the vulture investment banks have securitized student loans and created a whole chain of derivitives just like with morgages the sam scam and debt slavery
Just a minute. Who forced you to take the loan in the first place? Don’t like the terms, then finance it yourself, or perhaps reconsider your choice of college. I knew I would be taking on debt when I went to call, but figured that the payoff was worth it. What’s your problem?
Look, if you’re smart enough to go to college, it’s not really a great choice. This is why America is such a loser country now…we don’t even educate the smartest kids, just the richest.
It’s like saying “you should have the choice about whether of not to buy your own healthcare insurance”. OK. But if you’re uninsured you’re just going to end up paying those bills at the ER. So unless your choices are “insurance, or die”, it’s no choice. Same with this loan business. If you can’t afford college, then you’re pretty much doomed to a life of low-wage, shitty jobs, and you end up losing all that money that you didn’t spend on loans to the lost opportunity. Not much of a choice there; even the most forward-looking person would probably decided to take their chances with the loans.
This is all fine for you because you don’t have to worry about it, so naturally you’ll just want to save your own $10 of tax money. At least until there are no longer any domestic professionals left to be your doctors when you get old.
Except foreign countries educate their kids in things that matter like math and science. Subsidizing a bunch of “under represented” minorities in ethnic studies isn’t going to solve anything but create a generation of whiners
As well as even more debt. Those of you studying math/science/engineering related subjects need to realize that interest rates are going up because students loans are becoming more and more of a risk, thanks to not only to the dropouts, but those who major in coursework that provide a negligible return on their student loan investment. In essence you’re subsidizing those basket-weaving and victim’s studies majors by paying higher interest rates.
”Look, if you’re smart enough to go to college, it’s not really a great
choice. This is why America is such a loser country now…we don’t even
educate the smartest kids, just the richest.”
Oh, bullshit. The problem isn’t that kids can’t get into college. The problem is that too many students in college don’t have a clear plan as to what they plan on doing with their degrees. The students who are having problems paying back loans are typically the ones who pursued courses of study that simply have no demand in the marketplace, therefore making it quite difficult to pay back student loans. That results in the rest of us (students in more compensatory fields of study and the taxpayers) footing the bill.
“This is all fine for you because you don’t have to worry about it, so
naturally you’ll just want to save your own $10 of tax money.”
I pay a hell of a lot more than $10 in state tax revenue. In fact, most of us in the middle class here pay even more in state taxes here in California than “millionaires” pay in other states. The problem in California is NOT a revenue problem, it’s a SPENDING problem – and as long as the politicians and the bureaucrats in this state refuse to deal with issues such as unfunded pension plans, illegal immigration, and endorsing budget-busting boondoggles such as HSR, the problem won’t go away.