Graduating With a Mountain-Load of Debt
The President gave the first of his three 2013 commencement addresses at Ohio State this past week. (He will also speak at the U.S. Naval Academy in Annapolis and Morehouse College in Atlanta.) He encouraged the students to engage in public life and join the national debate on issues of concern.
They may want to take heed...especially when it comes to student loan debt. Back in February of this year HuffPo described two reports on the mushrooming debt
An analysis released on Tuesday of 10 million credit files from Fair Isaac Corp. (FICO) found the average student debt load ballooned 58 percent from 2005 to 2012 -- from $17,233 to $27,253. In the same period, the number of consumers with two or more open student loans on their credit report grew from 12 million in 2005 to 26 million in 2012, according to the Wall Street Journal.This past week, Politico ran an op-ed by Rohit Chopra, the student loan ombudsman for the Consumer Financial Protection Bureau, entitled - Excessive student loan debt drains economic engine. Chopra describes the fall-out from the high student debt load and how it affects the economy in the areas of housing, career choice, employee retention, entrepreneurship and even retirement security.
A CNN Report this week continued the story, even suggesting students are putting off getting married because of student loan debt:
About three-quarters of student loan borrowers surveyed said they -- or their children -- have been forced to make sacrifices in order to keep up with student loan payments, according to a survey from the American Institute of CPAs.
Forty-one percent of the more than 200 people surveyed said they have delayed saving for retirement, 40% have put off buying cars, while 29% have postponed home purchases. Even marriage has been put on hold, with 15% of respondents saying they delayed tying the knot because of student loan debt.
The majority of borrowers said they didn't anticipate having such a difficult time repaying their loans, and 60% feel some amount of regret about the decision to fund their education this way.
African American and Latino students may be carrying even more student loan baggage, as reported by the Center for American Progress last October:
African American and Latino students are especially saddled with student debt, with 81 percent of African American students and 67 percent of Latino students who earned bachelor’s degrees leaving school with debt. This compares to 64 percent of white students who graduate with debt. With $864 billion in federal loans and $150 billion in private loans, student debt in America now exceeds $1 trillion.
The rate on new subsidized loans is set to DOUBLE on July 1 -- from 3.4 percent to 6.8 percent. Last July 1, an election year, students were given a one-year reprieve. Probably not so lucky this year....
It would require an agreement by Congress -- and we know those are hard to come by these days.
There is a movement in Washington to reduce the interest rate on student loans. Newly elected Senator Elizabeth Warren (D-Mass) wants students to get the same rates offered to big banks by the Feds -- .075 percent. Warren has introduced a bill calling for this action.
Rep. Karen Bass (D-CA) is proposing the Student Loan Fairness Act of 2013 and a permanent cap of 3.4 percent on student loans. In a HuffPo piece entitled, Time To Get Serious on Student Loan Debt, she says:
I have proposed the Student Loan Fairness Act of 2013 as an initial step toward a comprehensive fix to the student loan debt crisis. This bill attacks the problem in a number of ways including allowing borrowers to have their loans forgiven up to $45,000 after making 10 years of payments at 10 percent of their discretionary income. Interest rates would permanently be capped at 3.4 percent and eligible borrowers would be able to convert their private loan debt into federal direct loans.Will there be any changes? Students and their parents may need to lead the outcry. This is one of those 'national debate' issues that cries for public involvement.
Still Trying to Get Along
The President golfed with two Republican Senators this past week -- Sen. Saxby Chambliss (R-Ga) and Sen. Bob Corker (R-Tenn). They say 'business' wasn't discussed much. (Yeah right...and if not what a waste). The biggest news that came from it was a hole-in-one by Chambliss.
Maybe the President had better luck at mutual agreements during last week's visit to Mexico and a first appearance in Costa Rica. He stressed joint economic interests at each locale.
Speaking of Costa Rica... While there, President Obama met with their President Laura Chinchilla.
Also, this past week he met with the President of South Korea....President Park Geun-hye of the Republic of Korea.
Hmmmmm. Two women Presidents. What does our future hold?
Hillary Clinton? Condoleezza Rice? And here's one to ponder...would African-American women...a sizable and DEPENDABLE voting bloc for the Democratic party... consider Ms. Rice?
This week, Emily's List, an organization which supports women candidates, launched its Madam President Campaign. Check out the video:
(Excerpts from my blog National Scene -- Week 15)
- It was a week of significant meetings for President Barack Obama, beginning with a trilateral conference with the leaders of Afghanistan and Pakistan to discuss stabilizing the region, and ending with a first-of-its-kind coming together of all of the major players involved in healthcare to discuss reform. Not to go unnoticed, was an Oval Office chit-chat between Obama, Al Sharpton, and Newt Gingrich to discuss education reform. This President is surely building bridges!
- Bringing Pakistan and Afghanistan to the Table. The President was joined by Vice-President Joe Biden in a meeting with President Karzai of Afghanistan and President Zardari of Pakistan. Initially, President Obama met separately with each leader, followed by a trilateral conference. Pakistan and Afghanistan are considered critical to America’s ‘war on terror’ and the President signaled the importance by saying, “We meet today as three sovereign nations joined by a common goal: to disrupt, dismantle, and defeat al Qaeda and its extremist allies in Pakistan and Afghanistan…to achieve that goal, we must deny them the space to threaten the Pakistani, Afghan, or American people.”
- Sharpton, Gingrich, and Obama – Huh?. “You're probably the only President who can make this happen,” the Reverend Al Sharpton told President Obama as he and former House Speaker Newt Gingrich met with the President in the Oval Office. The far-left civil rights activist, and the far-right former House speaker, shared a sofa as they discussed improving education. Expressing the need for a spotlight on the nation’s educational issues, Obama joked, “these are the two guys who know more than anybody how to get attention.”
- Town Hall in Spanish. President Barack Obama held the first-ever Spanish language town hall meeting to address the Hispanic community's concerns on the impact of the H1N1 virus.
- Sykes Socks-It-To-Them. This Sunday morning found Washington abuzz discussing comments made by comedian Wanda Sykes at the White House Correspondents’ Association Dinner the night before. Some feigned shock and displeasure, while others thought Sykes’ pointed jabs, particularly those aimed at Rush Limbaugh and former Vice-President Dick Cheney, were right on target. During the routine, Sykes herself summed up the reaction to some of her jokes by saying: “You’re not laughing now, but you’ll be retelling this tomorrow!”
- Historic, Unprecedented Meeting to Address Healthcare. President Obama made a major step toward health care reform by bringing together all of the major players and getting them to agree to changes that can bring about savings of more than $2 trillion on health care costs. Representatives from hospitals, the insurance industry, medical device and pharmaceutical companies, labor and physicians came to the White House to discuss major steps to lower health care costs across the board.
And Finally.....back to 2013:
The Obamas entertained a royal visitor this week...Prince Harry of Wales.