Political India: Engaging America

From The Hindu

U.S. President Barack Obama on Saturday said “bold reforms to the higher education system passed by Congress this week... [will save] taxpayers $68 billion over the next decade by ending the subsidies given to banks and middlemen who handle student loans.”

The President argued that the money saved through these reforms would expand and strengthen the federal Pell Grant program. It would also cap college graduates’ annual student loan repayments at 10 percent of their income, revitalize community colleges, and increase support for Minority Serving Institutions, he added.

In a strong statement against bank subsidies for student loans he said, “Year after year, we’ve seen billions of taxpayer dollars handed out as subsidies to the bankers and middlemen who handle federal student loans, when that money should have gone to advancing the dreams of our students and working families.” He said that attempts to fix the problem had been thwarted by special interests “that fought tooth and nail to preserve their exclusive giveaway.”

Mr. Obama expressed hope that by the end of this decade the United States would again have the highest proportion of college graduates in the world, by making college education more affordable for millions of middle-class Americans.

Pointing to the presently high cost of tertiary education in the U.S. he said, “About two in three graduates take out loans to pay for college. The average student ends up with more than $23,000 in debt. So when this change takes effect in 2014, we’ll cap a graduate’s annual student loan repayments at 10 percent of his or her income.”

He further said his administration was planning to revitalise programmes at community colleges and increasing support for our Minority Serving Institutions, including Historically Black Colleges and Universities.

Labels: Barack Obama, Pell Grant program, student loans, U.S. education