Forever a loan

President Barack Obama knows firsthand the pains of paying for a Columbia education. During a speech to students at the Auraria Campus at University of Colorado in Denver this past Wednesday, Obama spoke of his struggles with college tuition and student loans, noting that he and his wife had together accumulated $120,000 in debt from money borrowed to fund higher education. Unfortunately, the situation has only become worse since the Obamas went to college.

After two years of relative inaction in the realm of education, the current administration is finally looking to mitigate the financial headache bred by tuition bills nationwide. While the president used his time at Auraria to criticize Republican obstruction of the jobs bill, the centerpiece of the speech was an announcement of something that was long a key feature of his campaign rhetoric—student loan reform. Republican criticism has targeted the pronouncement as an unmistakable political appeal to young voters, a constituency that Obama brought out in droves in 2008 and is likely to lure back to the polls in 2012. Whatever his intentions, the president has announced a college affordability plan that is a laudable step toward true reform in higher education and deserves the support of not only students, but of all Americans.

Most of us are well aware of the burden of a college tuition, but it is important to put things in perspective. Today, the average cost of tuition at both public and private institutions is three times greater than it was in the early 1980s. This has obviously necessitated more available credit in the form of student loans—on average, more students take out loans today than at any other time in our country’s history. The size of loans themselves has also grown with the exponential leap in tuition. Last year, a student who took out a loan to pay for college graduated with an average debt of $24,000. In the wake of slow economic growth and fewer job prospects for college graduates, the future looks bleak for those of us who have had to supplement financial aid with outside assistance.

Does President Obama’s plan fix everything? No, but it certainly puts us on the right track. Planned to be executed in 2012, the president’s proposal consists of four main initiatives, some of which were initially scheduled for implementation in 2014. The primary tenet is loan consolidation. Instead of requiring payments to multiple private and government agencies throughout the month, Obama’s plan will allow borrowers to pay a single government loan fee once a month at a reduced interest rate. This will aim to bring down monthly costs by hundreds of dollars for 1.6 million people and also seek to limit penalty-inducing confusion. The second initiative will accelerate already existing plans to cap loan payments at 10 percent of discretionary income. This would be a significant reduction from the current 15 percent cap and would surely help to alleviate some of the burden. The next proposal would institute loan forgiveness after a period of 20 years instead of 25, ensuring that college financial worries do not plague Americans well into their adult lives. The final initiative is less sweeping than the other three, but its simplicity is its biggest selling point. The administration aims to produce a fact sheet titled “Know Before You Owe,” which would provide students with information on how to make their own financial decisions when planning out payments. Clarity is a quality often lacking when navigating the waters of college finance, and President Obama’s endeavor to make the process transparent deserves more than a passing glance.

Criticism directed at the plan has come in the form of arguments about its cost from lower interest rates and its execution. Republicans point out that this plan seeks to help pay the way for those who are college-bound while forcing blue-collar Americans who have not pursued higher education to foot the bill. This reasoning is asinine—promoting higher education will not only lead to investments in economic growth that can help all Americans, but the very point of this plan is to expand the accessibility of colleges and universities to those who were previously barred from attending because of financial circumstances. This will relieve the burden on middle- and lower-class workers in paying for their children’s education—not exacerbate it. In terms of the plan’s implementation, the president has been criticized for his use of an executive order instead of bringing the proposal to Congress. However, it is evident that Republicans in the legislature would do anything to strike down what would be a perfectly sensible bill simply to further their “party of no” mentality. Relief is necessary right now, and the American people would ultimately suffer from further delay.

While student loans are not going to go away, President Obama’s plan is a commendable movement forward in making college more affordable. Without a doubt, higher education is the gateway to success in this country, and it’s a breath of fresh air to see a policy maker finally focusing on the right line of attack. When it comes to education, perhaps our politicians are finally learning.

Jared Odessky is a first-year in Columbia College. He is the CCSC class of 2015 president. Worm in the Big Apple runs alternating Tuesdays.