<p>Political</a> battle over student loans heating up | General Headlines | Comcast</p>
<p>I hope they get this firgured out before the loan % doubles.</p>
<p>God, politics are infuriating. I really worry about who the new president will be, because they are literally going to be president for all 4 years of my college. So if the new guy doesn’t bode well for students… it’s going to be a bad 4 years.</p>
<p>It’s really not the president you need to worry about. It’s congress. The president can approve or veto bills, but he/she can’t make the laws.</p>
<p>The amount of power that people think the president has is baffling.</p>
<p>Well the executive branch does have a fair amount of influence and power… Ex? Republicans vocally refused to lower the interest rates on loans, Obama goes on a week-long College tour highlighting that fact, and suddenly congressional republicans support lowering it as well…</p>
<p>Ah, you must be reading fine pieces like this one: [GOP</a> Set to Double Student Loan Interest Rates | Eclectablog](<a href=“http://eclectablog.com/2012/04/gop-set-to-double-student-loan-interest-rates.html]GOP”>GOP Set to Double Student Loan Interest Rates | Eclectablog). (I am being sarcastic - I can’t stand the tone)</p>
<p>I didn’t see any legislation proposed by either party aimed at lowering the rates. Both sides missed the boat on this one. I don’t recall the President mentioning it as a priority until it was useful as a campaign tool … same with Romney. Fine bunch of folks we have in charge.</p>
<p>Neither side actually cares about this student loan stuff. Guess which group has the lowest turnout in voting? College aged kids! Guess which group has the highest turnout? People who pay federal taxes to pay for student loan subsidies!</p>
<p>@kelsmom - I agree that neither made an effort to publicize the issue until it was a useful campaign tool. However, it is clear from statements made by leading congressional Republicans that they weren’t going to support the effort until the about-face from Romney and Boehner following the Pres. making it a campaign issue.</p>
<p>I included this quote below that kinda summarized the situation, but also know Democrats had made clear their competing budget would include a lowering of the rates, and republicans made clear they felt the opposite, long before Obama began singing on late-night about it.</p>
<p>"With the lackluster economy and high rates of unemployment for young workers, Mr. Obama had asked Congress to deal with the impending increase, but until this week no big moves were made. The House budget, known as the Ryan plan, made no effort to block the increase and the Senate has no budget. Democrats did try to amend the Ryan budget in committee to prevent the doubling of rates; Republicans voted it down. "</p>
<p><a href=“http://www.nytimes.com/2012/04/27/us/politics/student-loan-debate-becomes-election-year-fight.html[/url]”>http://www.nytimes.com/2012/04/27/us/politics/student-loan-debate-becomes-election-year-fight.html</a></p>
<p>^But do not forget it was the democrats in the first place that put the provision for the rates to double right now. The republicans did not have a problem to block the increase as long as it was offset to make the cut so that no taxes were raised. They agreed now that they found the budget item to cut in order to keep the rates down.</p>
<p>Does anyone know how the financing of this program work? 10 year t-bill rate is around 2%. How is it that lowering the rate from 6.8% to 3.4% involves raising taxes in the actual sense if you look at the program itself as a self-contained unit. I know there is 2-3 years period where they have to subsidized the interest but after that isn’t it true that the program is making money when the government is borrowing at a very low rate and lending it out at a much higher rate?</p>
<p>Frankly I have not been following this issue closely, as my D doesn’t qualify for subsidized loans, and those are the only ones as far as I can tell, that will be affected.
The interest for unsubsidized loans is already 6.8%.</p>
<p>Either party would go a long way to getting my vote if they spearheaded a consolidation of unsubsidized Stafford and Parent PLUS loans to interest rates that were more in tune with the market.</p>
<p>Maybe they think that–like credit card companies–they have to keep the rates high to offset the inevitable defaults in the coming years, even though I know they are not wiped out in a bankruptcy, only in death.</p>
<p>There’s been a lot of chatter about students loans becoming the next “mortgage crisis”, meaning there have been many defaults and reckless lending. Many thoughtful people feel that the government should not be in the business of subsidizing student loans (or anything for that matter). Conversely, there are people who believe it is good public policy. Regardless, someone has to pay the interest on those loans, either the taxpayers or the people incurring the debt.</p>
<p>They can tie it to prime rate with some premium, but that would be too simple, no muss no fuss later. The current proposal call for one year extension so that they can have more political theatre again next year and beyond, that is if there is any chance of any bill passing at this point, so depressing…</p>
<p>“Regardless, someone has to pay the interest on those loans, either the taxpayers or the people incurring the debt.”</p>
<p>Unless I miss something, I don’t see how the taxpayers are involved in paying the interest here. The students pay for the interest after they graduate and they can’t default on it for any reason except for death. The taxpayers actually get money from the interest from where I can see.</p>
<p>I don’t really think either side has opposed keeping it low (forgive me, there were a few months when I was not following politics closely… I only got back in about a month or two ago). The issue is what to “cut” or “raise” in order to keep it low. </p>
<p>Republicans want to slash the healthcare bill funding. Democrats want to do it by increasing payroll taxes. To put it in very simple terms. </p>
<p>Interestingly enough, I think the Republicans are in a tougher spot than the Dems. Many fiscal conservatives want the subsidies gone and the Republicans who are trying to keep the rates low are getting it from both sides (the left and the far right). I don’t envy their positions.</p>
<p>^ Again sorry, what subsidies? I just don’t get it. The loans get paid back with interest that is above what the government get from selling their t-bills.</p>
<p>tt, I don’t either. I’m just boiling down the rhetoric.</p>
<p>The federal government pays the interest on subsidized student loans while the student is in school and during the grace period. I am assuming, of course, that those loans are impacted by the current debate.</p>
<p>Paying who though? Themselves? I thought the Stafford loans were made by the government? Does the government just subsidize them? I don’t get it.</p>
<p>i really don’t think it’s a big deal. the difference (6.8-3.4%) isn’t that much. it is not like a mortgage when you could have over $400k. the absolute amount of the interest on a $20k (subsidized) student loan doesn’t help much either way.</p>