Obama Administration Plans to Help Relieve Student Debt Burdens
According to a report in the New York Times
, President Obama plans on taking executive action to provide some executive relief to individuals suffering from the heavy financial burden of student loan payments. In an event set to be held today, Obama is expected to go into details about plans to cap the payments on student loans at 10% of a borrower's income, previously only applicable to students with loans starting after October 2007 and continuing through October 2011. Furthermore, plans to renegotiate deals with institutions such as H & R Block in order to encourage borrowers to pay and avoid delinquency will be explained. Lastly, proposed legislation to refinance the loans of millions of Americans with high interest rates will be detailed.
Most of the actions being taken by President Obama will be implemented via executive orders. The legislation is planned to be financed through a new tax on wealthy individuals, making it a piece of legislation which will doubtlessly be contested by opposing Republicans in Congress. Hopefully these plans will provide some sort of relief to previous students with loans. However, even if passed and implemented properly, they will not address the growing problems facing future students. The cost of education will keep rising and easing borrowing will reach a limit. The growth of this college bubble, which is happening at rates higher than those of the housing market back in 2011, will inevitably reach a breaking point if something fundamentally different is not done. Perhaps Mr. Obama should look towards the Canadian system and place a higher emphasis on public schools. As a college education is increasingly becoming something necessary, leaving the price of education to the free market may not be the best way to go about it. Thoughts?