Reportedly, Rep. John P. Kline (MN), chair of the House Committee on Education and the Workforce is hopeful of finding a solution that will help both students
By CHARLENE CROWELL
With federal college loan interest rates set to double on July 1, a flurry of activity has begun. Members of Congress and college students are speaking out in hopes to secure an important extension. If these efforts fail, an estimated seven million college students from middle and low-income families will see higher interest rates on top of those already incurred at the lower rate.
At issue is whether today’s Congress will once again provide bipartisan support to contain the rising cost of higher education lending. In 2007, the College Cost Reduction and Access Act became possible through significant support across party lines. A majority of lawmakers agreed to cut the cost of college loan interest from 6.8 percent to its current 3.4 percent.
Now, with fewer than 90 days left before the extension expires, many are worried that federal student loans for those just beginning college studies will be an unmanageable financial burden.
“The prospect of raising student loan rates is like nails on a chalkboard”, said New York Senator Charles Schumer. “College tuition has skyrocketed at universities and colleges across the country, placing a huge burden on middle class families.”
Many college students agree. In recent days, several college and university newspapers have reported on this looming issue, some taking an editorial stand on what it means to today’s collegiate.
AtWest VirginiaUniversitythe student publication, Daily Athenaeum said in an editorial, “Students are already struggling to keep up with rising tuition and living expenses and, if anything, the government should be working to make college more accessible to high school graduates.”
Similar expressions were echoed in an editorial by The Minnesota Daily, theUniversityofMinnesotastudent newspaper. “Student debt throughout theU.S.has compelled recent graduates to put off choices such as home-buying, marriage and childbearing. One in four young Americans have moved back in with parents after having lived elsewhere. The delay of such choices has an impact on the overall economy causing some to call student debt a new ‘bubble’.”
A new analysis by academicians with two universities - Northeastern and Drexel and the DC-based Economic Policy Institute found that last year over half of bachelor’s degree graduates under the age of 25 were either unemployed or under-employed. This disastrous economic measure was felt by 1.5 million graduates.
Further, just last month the nation’s student debt surpassed $1 trillion and continues to climb.
The awful irony of this looming and costly decision is that some members of Congress took early action to avoid a debt countdown. In January, legislation was introduced by Sen. Jack Reed (RI) and Rep. Joe Courtney (CT) to permanently set the loan interest rate at 3.4 percent. Substantial numbers of co-sponsors also signed on: 15 in the Senate and 127 in the House.
To date, neither chamber has held a hearing, the first step toward a floor vote. A portion of the reluctance could be the Congressional Budget Office’s estimate that freezing loan interest for just one year would cost the federal budget $6 billion.
Reportedly, Rep. John P. Kline (MN), chair of the House Committee on Education and the Workforce is hopeful of finding a solution that will help both students and taxpayers.
For African-Americans, the rising cost of higher education poses a unique predicament. In 2010, according to BlackDemographics.com, Black college students numbered 3.8 million. While this figure represented a 2 million increase since 1993, the number of Black college graduates with a bachelor’s degree increased just one percentage point since 2000 and is still 10 percentage points lower than the number of graduates for the entire country.
These statistics suggest that while many Black students enroll in colleges and universities, those who actually graduate are far fewer in number. Further, if students leave higher education without a degree, the deferral on student loan payments end – contributing to a financial challenge of paying back those loans without the higher incomes derived with a college degree.
As Senator Reed has said, “Making college more affordable is key to unlockingAmerica’s economic competitiveness. Business leaders know it is vital for young Americans to get an education beyond high school. If today’s students cannot afford college, businesses will not have the workers with the education and training they need to keep our economy competitive and dynamic far into the future.”