Obama’s loan plan hits close to home

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Posted Thu, Nov 3, 2011

Hurry Up And Wait: Outside of the Tivoli, students waited in line for hours to get tickets for the President's speech last Wednesday. Photo by Nikki Work

DENVER — For some, it was an inspiration; for others, an opportunity. For the future of Metro State students, last week’s presidential visit was groundbreaking.

“I thought Obama was a remarkable speaker,” said Metro State graduate, Devan Krey. “He seemed very relaxed, very confident, and above all very personable. It was evident that he really cared about the crowd and values what students here at Auraria are doing.”

Krey, who is also MSCD employee, waited in line to pick up tickets for President Obama’s speech for two hours, and then waited an additional hour and a half to get into the event center for the speech.

“I already knew, for the most part, what he would be discussing. I was very curious to see him in person and see how all the students would react to him,” Krey said.

During the presidential address on the Auraria campus last week, Krey and thousands of others witnessed the debuted of Obama’s updated student loan plan to ease the financial burden on college graduates.

The plan, which was approved by Congress last year and slated to take action in 2014, has been moved up to start in 2012, and will lower students’ required payments from 15 percent of their discretionary income to 10 percent. After 20 years, the remaining debt will be forgiven. Over a million students will be aided by this plan, including many of Metro’s own.

“The impact on eligible students will be unambiguously good,” said Dr. Sheila M. Rucki, assistant professor in Metro’s Department of Political Science. “This country has to do something about the historic burdens we are placing on students.”

However, not all indebted students will be helped by this plan. Those already in default and those with loans from private lenders, for example, will not be covered by the initiative.

But for a state like Colorado, whose public education system has been on the downhill slope for years, this program is especially important.

“State funding everywhere has gone down, in Colorado it has collapsed, and tuition has skyrocketed,” Rucki said. “In the past, states recognized that they benefited from a well-educated population and so they were willing to bear more of the burden to provide it.  Now we seem to expect students to carry the whole burden themselves, which puts higher education out of the reach of much of the middle class.”

In the Colorado election on Nov. 1, Proposition 103, which proposed a tax increase to fund the struggling public school system, was voted down, as have the majority of the bills of its kind.

“I don’t think that Colorado can maintain the quality of public education at the level of public funding that we’re at now,” said Dr. Robert Hazan, chair and professor of Metro’s political science department.

By the end of the year, student loan debt in the United States will exceed $1 trillion, bypassing the amount of U.S. credit card debt. To make matters worse, according to a May 18 article in the New York Times, college graduates are having an increasingly difficult time finding jobs. Only 56 percent of the class of 2010 had found a job by spring of 2011. Also, an increasing number of college graduates are settling in jobs that don’t require a degree.

From 2006-2010, $20,000 was the median amount of student loan debt. Students are having an increasingly difficult time juggling both the rising cost of living and their ballooning loan payments.

“There are an increasing number of students who are dependent on food banks. I hear more and more students don not have shelter, [or] decent living standards,” Hazan said, “and this is unacceptable.”

Now, as Obama has been touring the country and speaking of his plans to help bolster the economy, the plights of struggling college graduates have been gaining more and more attention.

“I think there was very little discussion up until now on student loans and students’ indebtedness and now it’s becoming a major issue,” Hazan said.

An issue, he said, that is far too large and too complicated for this plan to completely solve.

“I think it’s a very important idea, and I’m not sure about the feasibility. I’m not sure whether it is a plan that will be effective at this juncture fiscally.”

Though the plan is certainly not perfect, as Rucki points out, it is progress towards a solution.

“Something is better than nothing,” said Rucki. “Given the anti-tax climate, this may be the best we can hope for right now.”

Krey, like many students, will not be immediately affected by the loan plan, but he agrees that it is a step in the right direction.

“So far I have not had to take out a student loan, but I probably will when I attend graduate school,” Krey said. “It is comforting to know that loans in the future will be easier.”

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3 Responses to “Obama’s loan plan hits close to home”

  1. Kevin Rostad Says:

    Good story. It seemed to drag on a little but you seemed to get your point across as well.

    Reply

  2. Caitlin Sievers Says:

    Interesting story, alot of facts but you kept it from being too dry.

    Reply

  3. Alex Says:

    Got a lot of information in there, and you presented Obama’s bill very succintly. Nicely done. The intro was a little fawning. More booster than reporter.

    Reply

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