Student Debt Situation Swaying the Presidential Balance
With the presidential elections just around the corner in November, both candidates are having a tough time negotiating their way around the enormous issue of the student debt crisis. Even though both the candidates, President Obama and Gov. Romney are in support of keeping the interest rates at constant and are trying to devise strategies to rope in more voters from the young crowd.
The Senate’s close call on the doubling up of the interest rates in late June has had mixed responses from the defaulters. Even the candidates have had their own sys on the issue and their urgent damage control measures. While Obama clarifies that he has been egging congress on for a long time to take steps on this issue, Romney and his supporters see Obama’s failure to deliver on the promises he made after being elected as the President
The one-year breather that congress has granted the defaulters has been a silver lining that the students had been looking for, but according to the experts, it is not going to be sunny all year round. This is a temporary window and chances are high that the rate might double again in the next year. However, for the pre-election season, this is going to win a number of votes from the young voters who consider this as a deciding factor before casting their votes in November.
Another factor that the students are definitely going to consider is the job market. In an economy where even a master’s degree holder is not sure of a job that will pay all the bills, this is going to be the core reason behind the dip in the number of votes for the ruling party.
Apart from the apparent victims of the defaulted student loans, the students, another group of people who have been affected harshly by the outcomes are the retirees. A number of parents who took out loans for their children’s higher education are facing consequences for not having paid the loans back. Now that they have retired they are in hope of getting their Social Security Retirement Benefit. But since they have not cleared their loans, their benefits are being withheld. Since these loans can not be usually discharged through Bankruptcy, the only way they can be gotten rid of is by paying them off. They are, therefore, facing a lot of problems also from the collection agents. But the Department of Education has pointed out that the loan accounts are only transferred over to the collection agencies after two years of non-payment. If the collection attempts of the collection agents meet with failure only then is the case referred to the Treasury Department which has the authority of withholding the Social Security Benefits. Therefore, if the people are having their Social Security withholding, it means that they are making no attempts at clearing off their loans. Until this month the federal government has curtailed a portion of as many as 110,000 social security checks, a number that was half even a year back.
A minimum of $750 a month has to be left alone for the borrower to manage their expenses. What is really sad is that half the people are not even paying loans that they took out for themselves. Even though there are a number of retirees who are actually paying the loans that they took out for their higher education, there are a higher number of retirees paying off loans that they took out for their children or grandchildren to help them with their graduation.
The student loan laws have undergone sea changes and therefore it is extremely important that borrowers are very careful when they take out loans for their higher education. After the Budget Control Act became law more than a year back, graduate students have been barred from getting loans at a subsidized rate. Also, the specifications for loan eligibility have been changed. Students who are expecting financial aid will have to have their family contributions assessed. This is posing a problem for the families residing in Idaho since the poverty rate is increasing at a rapid rate ever since 2010. As the number of defaulters and the amount of unpaid loans increase, the federal government is hiring more and more private collection agencies to take care of the situation.
Federal student loans are a very good means of helping student finance their higher studies. Since they have a number of easy repayment options which are not available on private loans, therefore, students tend to take more loans that they can pay off. This is a common mistake that students commit and pay for later in their lives when they are unable to get a suitable job. According to a recent survey, about 10% of the graduates who study under the 4-year term have to bear the burden of monthly loans payment that exceeds about 25% of their income.
There are a number of sources that help students with their loan payments. But they have to be really quick. All the student loan debt helps are useful as long as the loans are not turning into debts. Defaulted loans are very difficult to clear. Therefore, students are always advised to keep a record of their loans and their status.
The student debt crisis is becoming a crucial point of debate for both Presidential candidates. While Romney is pointing out the dismal job prospects and the difficulty of the students in paying off their loans, Obama is pointing out his efforts in making the changes that took place, even if a little late. The bottom line, however, remains that both of them are in favour of the low-interest rates, many consider this as a mere trap to keep the students stuck in a web of loan repayment slavery. The month of November is going to prove very crucial for the entire United States of America for more reasons than one
Student Debt Situation Swaying the Presidential Balance
The student debt situation in the United States has become a significant issue in recent years, with many calling for increased government action to address the growing burden of student loan debt. The weight of student debt has become so great that it has even begun to impact presidential elections, as candidates must grapple with how to address this issue while balancing other priorities.
In the lead-up to the 2020 presidential election, student debt emerged as a key issue for many voters, particularly young voters who have been hit hardest by the burden of student loan debt. According to a survey by the Pew Research Center, more than 6 in 10 Americans (63%) say they believe that the federal government is not doing enough to help people with student loan debt, and a majority of Americans across all age groups support some form of student loan forgiveness.
In response to this growing concern, several Democratic candidates in the 2020 election, including Senators Bernie Sanders and Elizabeth Warren, proposed plans to address the student debt crisis. Sanders proposed a plan to cancel all outstanding student loan debt, while Warren proposed a more targeted plan that would cancel up to $50,000 in student loan debt for those with household incomes under $100,000.
While these proposals garnered significant support from young voters, they also drew criticism from some who argued that such plans would be too expensive and would unfairly benefit those with higher incomes. As a result, the issue of student loan debt remains a complex and contentious issue, with no clear consensus on how to address it.
However, the weight of student loan debt continues to be felt by millions of Americans, and it is likely to remain a key issue in future presidential elections. As the cost of higher education continues to rise and the burden of student debt grows, candidates will need to grapple with how to address this issue while balancing other priorities, such as the economy, healthcare, and national security.