Obama v. Romney 2012 (students caught in the middle)
Welcome to the 2012 presidential election, student loan borrowers. YOU are going to have a front-row seat over the next three weeks as both parties propose alternative plans to pay for an extension of the current 3.4% interest rate on federally backed Stafford student loans before those rates double on July 1st. Since both parties desperately want your vote this November, neither is willing to let the rate increase go into effect. Before they can strike a deal however, they must first play a high stakes game of 'chicken' to see who blinks first, thereby conceeding too much ground in the eyes of their coalescing bases...
Such is the case in an article published in the New York Times yesterday by Jackie Calmes illustrating the changes that President Obama wants to aid student loan borrowers and how in his opinion, Republicans are "sitting on their hands." The president says that he wants to expedite a change to a 2009 law that would allow student loan borrowers to have their repayments capped at 10 percent of their disposable income (down from the current 15 percent). Although the change would not take effect until 2014, the president wants the 10 percent cap in effect for any new student loans taken out after this year. So what does Heather Jarvis think about the president's proposal, you may ask?
"I commend the president and the administration for calling attention to Income-Based Repayment. Of course, IBR is available now and more borrowers could benefit from it today. Easing the application process is a welcomed step in the right direction that is long overdue." Heather went on about other ways in which the student loan maze is difficult to navigate, but that's a discussion for another day.
In response, Republican leaders criticized the president's campus tours at colleges and universities in swing states as political theater that is not getting us any closer to a deal on the looming student loan rate increase. House speaker, John Boehner, and House majority leader, Eric Cantor sent the president a joint memo requesting for him to cancel his planned speech in Las Vegas on the issue and to instead return to Washington to tackle the issue. "With all of the great economic challenges facing our country, there is no reason to manufacture political fights where there is not policy disagreement," they wrote to the president.
So, sit back, grab some popcorn and enjoy the show, student loan borrowers. THIS is going to be some good theater...
