Posted In: Future Educators, Higher Education

President Obama speaks out against doubling student loan rate

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by Colleen Flaherty

On a particularly warm Friday morning at the White House Rose Garden, President Barack Obama addressed a group of students and recent graduates about the issue weighing most on their minds – student loan debt.

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“These students and graduates are here to talk about something that matters to millions of young people and their families, and that’s the cost of a college education,” said Obama in his speech. “Because this isn’t just critical for their futures, but it’s also critical for America’s future.”

If Congress doesn’t take action by July 1, the federal student loan interest rate will double from 3.4 percent to 6.8 percent, which will affect parents, students and educators for the worse.

The President also pointed out that while the economy may be improving, the exponential rise in student loan debt that surpassed $1 trillion last year is hurting opportunities for ordinary Americans.

How do we make sure our workers earn the skills and education they need to do the jobs that companies are hiring for right now, and are going to keep hiring for in the future? We know that the surest path to the middle class is some form of higher education – a four-year degree, a community college degree, an advanced degree. You’re going to need more than just a high school education to succeed in this economy.

Currently, students who graduate from college have nearly $27,000 in student loan debt. Obama pointed out that it doesn’t just hold back young graduates, but when Americans owe more on their student debt than on credit cards, it holds back the entire middle class.

“Those payments can last for years, even decades, which means that young people are putting off buying their first car, or their first house – the things that grow our economy and create new jobs,” said the President.

President Obama even had a personal story to share about student debt: “Michelle and I, we did not finish paying off our student loans until about nine years ago. And our student loans cost more than our mortgage. Right when we wanted to start saving for Sasha and Malia’s college education, we were still paying off our own college education.”

David Tjaden, a recent University of Iowa graduate and chair of the NEA Student Program, attended the speech.

“The mood there by the college students was very hopeful,” said Tjaden. “They were very excited that the President was once again taking the time to make this issue a priority for his administration.”

Tjaden said this issue is particularly important to the 60,000 future educators that he represents in the NEA Student Program.

“We know we’re not going into a highly paid profession. We can’t be paying off our student loans until we’re 75. We shouldn’t have to do that. We’re going into public service because we want to make a difference, but if we want to get the best and brightest in teaching, we need them to be able to go to college.”

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Last year when this same issue came up, Congress prevented the doubling of the federal student loan interest rate, which Obama credited to passionate student activists who made their voices heard.

“You made something bipartisan happen in this town that is – that’s a powerful thing. You guys were able to get Democrats and Republicans to vote for something that was important,” said Obama. “So this year, if it looks like your representatives have changed their minds, you’re going to have to call them up again or e-mail them again or Tweet them again and ask them – what happened, what changed? You’re still taking out these loans. You’re still facing challenges.”

“So I’m putting my faith in you. Let’s work together. Let’s get this done by July 1st.”

Click here to contact your congressperson to tell them not to double the rates!

Reader Comments

  1. Kerry Hyman

    When we bailed out the banks with $4.7 TRILLION of tax payer money (precious revenue that could have been used to run the most sophisticated, secure, mighty (military) free, privileged, and advanced nation on earth), and that same year bank CEOs, their executive teams, and upper level management distributed $BILLIONS in bonuses (when you calculate the ripple effect of the sub-prime mortgage deregulation fever that gripped Wall Street; 35% reduction in home values, homes in foreclosure, underwater, the curtailment of the building industry (concrete, lumber, asphalt, roofing, HVAC, and other building materials), lost jobs and unemployment compensation, economic slow-down, lost retail sales, Auto bankruptcy bailouts, etc. some have calculated the loss at closer to $20 TRILLION- what nation can sustain that?), don’t you think this heavy handed approach toward our student’s looks like nothing less than a money grab? SHAME!
    With the advent of the “global economy” where industrialized Western nations are competing for unskilled manufacturing sector jobs for their populous with sweatshop labor forces abroad, (China= $1.36/hr. avg. wage), the offshoring of 9 million manufacturing jobs, 50,000 manufacturing plants boarded up, laying in decay, covered with graffiti that once employed our unskilled workers), our “multinationals” certainly have the upper hand. Some have called the downward pressure on wages to compete, the “race to the bottom,” I call it “getting in a pissing match with a pole cat!” Who would be stupid enough to enter a race like that? Answer: our “multinationals,” headquartered in, and benefitting from all that a USA address has to offer; and making record gains exploiting this economic treason. Beauty of it is, they soak the USA with these cheap imports (rolling up on our shores in Maersk freighters (capacity: 2.2 million train car size “containers), to fleece the increasingly unemployed/underemployed, declining USA commoner they’ve kicked to the curb for a larger take, then park their record $TRILLION profits in offshore accounts to stiff their nation of origin (paying taxes to America the Beautiful is for chumps! http://robertreich.org/post/51397984260)

    See the fate of Bill S3816; what it contained and how they voted; speaks volumes!

    https://www.youtube.com/watch?v=QPKKQnijnsM

    https://www.youtube.com/watch?v=wK1MOMKZ8BI

    Reply
  2. ed ruisz

    The Republicans have shown a willingness to lower the rate as well. Something will certainly get done before the deadline. The biggest problem is not the difference between the Republican plan and that of President Obama. That will amount to a few dollars a month in payments. Instead, it is the rising cost of college itself as tuition rises well above the cost of inflation each and every year. Why does this continue to happen? Obviously, this increases the principal of every loan taken by a college student. I’d like to see a bipartisan commission look into this and come back with some answers and remedies.

    Reply
    • M Butcher

      I agree. My daughter attends college out of state and her tuition is double the tuition of a student who lives in-state. From what I understand, students from diverse regions and countries are desired by colleges and universities. Is it because those students bring a new level of potential growth and learning to the college experience, or Is it because out-of-state students are worth more to the colleges and universities financially? I personally think the latter is the most likely reason. Do students who come from different states or countries cost the college twice as much to educate as those from their own state? I don’t think that’s the case.

      It’s understandable that tuition should rise some since everything from food to technology costs are rising steadily, and there are a lot of costs for colleges to cove,r but I’d like to get a clear look at the comparison of cost and profit.

      Reply

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