The Student Loan Crusader: How Elizabeth Warren Wants to Reduce Debt
By Tim Dickinson | August 20, 2014
As a first-term senator from Massachusetts, Elizabeth Warren is advancing her fight for middle-class families with a legislative agenda focused on college affordability and student debt. "Rising student-loan debt is an economic emergency," she says. "Forty million people are dealing with $1.2 trillion in outstanding student debt. It's stopping young people from buying homes, from buying cars and from starting small businesses. We need to take action."
Warren's bills range from pie-in-the-sky progressive – she called for college loans to be issued at the same, nearly free, interest rates that Wall Street banks receive from the Fed – to soberly bipartisan. Her proposal to refinance outstanding student-loan debt at less than four percent interest (financed by a new minimum tax on America's top earners) nearly cleared the Senate in June, and will return to the Senate floor for a new vote this fall. "This country invests in tax loopholes for billionaires," she says. "And forces college students to pay for them through higher interest rates on their loans. That makes no sense at all."
College affordability is not a new problem. Tuition costs are up 500 percent since 1985. Senate Minority Leader Mitch McConnell says the solution is that "not everybody needs to go to Yale." That sounds cynical. But is there some pragmatism there? Is it time to admit that a traditional college education has become a luxury good?
Mitch McConnell's idea that people should dream a little smaller is deeply flawed. And let me add: The problem is not limited to private universities. States used to pick up about three out of every four dollars it cost to educate someone at a public university. Now it's about one in four. In America today, a young person needs more education after high school just to have a chance to make it in the middle class. Not a guarantee, just a chance to make it.
What can Congress do about it, on the front end, to rein in tuition?
One way is to force schools to have some skin in the game. I've co-sponsored a bill with Sen. Jack Reed [D-R.I.] that requires colleges with high student-loan defaults to pay back some of the federal student aid they use.
Read more: http://www.rollingstone.com/politics/news/the-student-loan-crusader-how-elizabeth-warren-wants-to-reduce-debt-20140820
= new reply since forum marked as read
