| OR OBAMA'S EPresident Obama wants to forgive student loan debt |
This is one of the more ridiculous demands being made by the Occupy Wall Street crowd. And it seems that President Obama has given in.
His new plan will allow students to pay just 10% of their yearly income towards paying down their loans andcompletely forgive loan debt after 20 years. In 2014, a plan was already in place to allow 15% repayment and forgiveness after 25 years, but with the youth vote slipping, the President had to speed things up.
What this essentially amounts to is vote buying. Since President Obama gave complete control of the student loan program to the federal government, all student loans are paid for with tax dollars. This is because there is no more private student loan market; the government controls the entire student loan industry. Which should be scary on its own.
Because of this, the President is telling students that it is okay to take on more debt, because if they can't pay it back or if they use that money to get a degree that doesn't pan out to a real job, no big deal. It's another instance of the government taking care of people who make poor decisions.
The President, who is out campaigning instead of fulfilling his duties of office, offered this plan to students during a campaign speech in Denver. Now it's important to note, that while this program sounds great for students who don't want to pay back their obligations, it would actually only affect about 6 million of the more than 36 million students paying off loans.
What the President failed to mention is that this plan actually consolidates private and public student loans. Remember, because the government controls student loans now, there are not many left who hold private loans. The resulting consolidation will only result in about half a percentage point of interest payment reduction, which amounts to less than $10 a month.
The President's student loan "plan" is a joke! He used an executive order to go around Congress in order buy youth votes! CLICK HERE to tell Congress that this will only add to the student loan debt crisis and encourage young people to take on more debt that we can't afford.
House Education and Labor Committee Chairman John Kline (R-MN) categorized the President's student loan program like this:
| "It's very confusing. I've talked to a lot of people about what the president's proposal is and it's very difficult to figure out. Some of the changes are going to affect a small number of students; some of them are going to affect a larger group of students. But all of it, in fact, is going to encourage more borrowing, I'm afraid, and leave the taxpayer holding the bag." |
Students are leaving college owing an average of $24,000 in debt, and are having trouble finding jobs to pay back those loans (the youth unemployment rate is much higher than the national unemployment rate). But that doesn't mean they should simply get a pass at loan repayment.
Because they are being loaned taxpayer funds to go to school, it is incredibly unfair - even immoral - to allow students to not pay back their total obligation. As The Heritage Foundation's Lindsey Burke describes:
| "It is unfair to forgive student loans on the backs of waitresses and construction workers and the nearly three-quarters of Americans who didn't graduate college. Increases in federal subsidies or student loan bailouts shift the burden of paying for college from the student - the person directly benefiting from college - to the millions of Americans who did not graduate from college." |
The taxpayers who are paying for these loans in the first place will likely not get all their money back, as Chris Stirewalt of Fox News claims with this example:
"If Suzy Creamcheese gets into George Washington University and borrows from the government the requisite $212,000 to obtain an undergraduate degree, her repayment schedule will be based on what she earns. If Suzy opts to heed the president's call for public service, and takes a job as a city social worker earning $25,000, her payments would be limited to $1,411 a year after the $10,890 of poverty-level income is subtracted from her total exposure.
Twenty years at that rate would have taxpayers recoup only $28,220 of their $212,000 loan to Suzy."
Is that right?
The President's student loan "plan" is a joke! He used an executive order to go around Congress in order buy youth votes! CLICK HERE to tell Congress that this will only add to the student loan debt crisis and encourage young people to take on more debt that we can't afford.
The other issue raised is that, if a student simply neglects to pay back their loans or fails to get a job that pays above the poverty level, they will be totally forgiven. What message does is send to American's that if they don't achieve success, they won't face any negative consequences. Forgiving student loan debt in this way rewards students who are not ambitious.
There are now 19% of young men age 25 to 34 that live with their parents. This suggests they either do not have jobs or have low paying jobs. Imagine that many college graduates at that age with debt. Now, to be fair, it does not seem likely that anyone would choose to limit their success just to avoid paying all of their student loans, or at least limit their success until their mid-40s, but with this percentage living with their parents, it is startling.
At age 34 they are already half way towards forgiveness. With the increasing dependency of America's youth, who's to say that more 40 year-olds will not also be living with their parents and working low-wage jobs?
Can we really take that chance?
The President's student loan "plan" is a joke! He used an executive order to go around Congress in order buy youth votes! CLICK HERE to tell Congress that this will only add to the student loan debt crisis and encourage young people to take on more debt that we can't afford.
President Obama's approval rating among the youth is below 40%.
Youth unemployment is around 18%
Instead of enacting pro-growth policies, this President has chosen to continue the same failed Keynesian economics that have not worked, and now he's giving money away in order to get votes.
This new executive order will help add to the student loan bubble, which threatens to pop and cripple the economy, just like the housing bubble a few years ago.
The American people cannot afford to take such huge losses from the student loan market. Our national debt is nearly $15 trillion, there is no way we can afford to give students a pass on their loans. Please Fax every Member of Congress now and tell them that this program will do more harm than good and that we need to promote job growth in this country, not more debt.
Conservative Action Alerts
www.ConservativeActionAlerts.com
P. S. If President Obama TRULY CARED about students, he would be working with conservatives in Congress to pass pro-growth jobs bills that will get young people, and the rest of the unemployed, working again.
Unfortunately for America, President Obama just doesn't get it. Thankfully, many in Congress do get it, and they need to hear from you.
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