Front Page Talking Points

FOR THE WEEK OF JUNE 16, 2014

New federal student loan break puts an income-based lid on monthly payments

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1.gifLook for news about a college you like and tell why that campus is appealing. (A sports article is OK.)

2.gifCan you spot coverage that mentions or quotes a college student. Summarize the topic.

3.gifNow look for any other education-related news and tell whether it could affect you or your community.

President Obama thinks you should leave college without a crushing loan burden. He's expanding a program that lets borrowers pay no more than 10 percent of their income every month in repayments, and backs more sweeping Senate legislation to let graduates with heavy debts refinance their loans at lower rates. "In America, no hard-working young person should be priced out of a higher education," Obama said at a White House event with students, echoing a radio address two days earlier (see video below).

The White House says that nearly three-quarters of bachelor's degree recipients leave college with debt, which averages $29,400. "While most students are able to repay their loans," an online fact sheet says, "many feel burdened by debt, especially as they seek to start a family, buy a home, launch a business." The president's new "Pay as You Earn" program change enlarges the 10-percent cap to cover federal loans made before October 2007, which the government says could reduce monthly obligations for an additional 5 million borrowers. Jobless grads might pay nothing until they’re hired. And after 20 years of payments, any remaining debt would be wiped clean for private sector employees. Those working for a government agency or nonprofit group get that break in 10 years. Eighty-six percent of outstanding school loans are federal.

The Senate this week is expected to debate its legislation, pushed by Sen. Elizabeth Warren, D-Mass. Republicans disagree with the Democrats' plan for how to pay for it. Republican leaders in Congress also say Obama's steps don't address the larger problem of high college costs. In any event, there’s no deny the huge shadow cast by U.S. student loan debt – now totaling $1.2 trillion.

President says: "This should be a no-brainer." – June 9 announcement at White House

Republican critic says: "This bill [from Sen. Warren] doesn't make college more affordable, reduce the amount of money students will have to borrow, or do anything about the lack of jobs grads face in the Obama economy." – Sen. Mitch McConnell, R-Ky.

Democratic senator says: "There are more than 40 million people currently dealing with student loan debt. When their interest rates are cut, many will save hundreds of dollars a month and many more will save thousands of dollars a month." – Elizabeth Warren, D-Mass., speaking about her bill

Front Page Talking Points is written by Alan Stamm for NIEonline.com, Copyright 2024

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Common Core State Standard
SL.CCS.1/2/3/4 Grades 6-12: An essay of a current news event is provided for discussion to encourage participation, but also inspire the use of evidence to support logical claims using the main ideas of the article. Students must analyze background information provided about a current event within the news, draw out the main ideas and key details, and review different opinions on the issue. Then, students should present their own claims using facts and analysis for support.