If you’re like me, you’re stuck paying off student loans with an interest rate of 6.8% which basically ensures that I’ll be paying them off forever (with most of it going to interest.) The good news is: over the summer, legislation was finally passed to lower student loan interest rates so that students taking out new federal loans could at least catch a little bit of a break. The bad news is: it doesn’t apply to people with existing loans. So those of us who took out loans before 2013? Lolz, sorry guys, nobody cares about us. Well, except for Sen. Elizabeth Warren (D-MA).
Elizabeth Warren has been an amazing crusader for college students when it comes to their ever-expanding financial burdens, and she was a heavy influence on the lowering of interest rates in 2013. Her latest plan would help students who had prior student debt to refinance their loans with a lower interest rate — by taxing millionaires (the tax, proposed by Obama in 2011, is called the “Buffett Rule” appropriately named after Warren Buffett.) This tax could raise on average around $5 billion a year that could potentially go to helping students refinance their debt. According to CNN, “Today, Americans hold an all-time record $1.3 trillion in student debt. It cannot be discharged by bankruptcy or even death. In some cases, Social Security benefits are being garnished to pay for a grandchild’s debt if a grandparent co-signed.” When you consider that, and the fact that it’s estimated that the government will make $184 billion from student loan interest over the next decade, this plan doesn’t seem like such a bad idea at all (at least not to us.)
According to Think Progress, Warren thinks America needs to make a decision. She asked, “Do we invest in students, or millionaires?” and plans to introduce a bill that would lead to an “America that invests in those who get an education.” Here, she addresses the audience at the Higher Ed Not Debt Campaign launch event at the Center For American Progress on March 6th:
As Warren puts it, “it’s billionaires, or students.” And it really comes down to a question of what our government thinks is more important.
Students’ financial burdens have gotten so bad lately that instead of picking a school that truly fits their needs and desires for higher education, Millennials are now being encouraged to go to schools with the best return on investment (ROI). It’s all about the money, the future salary expectations, and the importance of seeing a certain school on their diploma, not about the quality of education, the mentorship of professors, or the overall college experience that many college students are looking for. While the ROI might be the most important factor for some (and it is good to know, of course), it certainly isn’t for everyone, and that’s why we need to make higher education more accessible to everyone without swallowing students up in tens of thousands of dollars of debt with high interest rates.
Sounds to us like Elizabeth Warren’s plan would make things better for students all-around, with a minimal impact on others.