Students Owe Billions

As our nation's student loan debt reaches one trillion dollars, there might be some hope when it comes to paying the loans back.

Starting in 2012, and affecting all students currently in college who have federal loans, President Obama has made an executive order that will lessen the burden of paying back student loans.

"If we lessen student loans, people will spend more money and that will boost the economy," says social science professor David Plazek of the new plan, which will include three parts, if Congress does not fight it.

The maximum required payment on these federal loans will be 10% of annual income, rather than the 15% that it is now.

The proposal includes loans being forgiven after 20 years of paying, instead of the current law, which is 25 years.

All federal loans will also be able to be put on one monthly bill instead of having a separate bill for each separate loan. This will save students money because there is a maintenance fee for each loan, and this way there would only be one maintenance fee.

LSC senior Emma Shattuck, says that she thinks it's great that Obama is addressing the student loan debt, but thinks that his plan will not help the majority of students.

"The problem of student loan debt is still going to be largely unaddressed," says Shattuck.

Shattuck believes that since the salary to debt ratio that is still in place, the fact that students that have graduated before 2012 will not receive these benefits, and students that have defaulted loans will not qualify will deem this plan unhelpful.

Another student, junior Jeremy Schichtle, says as a student he finds this plan very appealing.

"With more people going to college and more job seekers having four year degrees the competition for finding a career is becoming increasingly difficult requiring more schooling to try and gain an upper hand," says Schichtle. "This requires students to take out more loans while still striving for the same paying jobs."

While enrollment in colleges has been increasing, the amount of assistance the government has been giving students has been decreasing.

"It's the system that has done them [the students] in, not themselves," says Plazek. "Because after all, getting a college education is good for an individual and good for society… but we've become pretty shortsighted."

Plazek says that not supporting higher education financially and having people be in debt after college is a huge detractor from the economy. This is because the money that is being used to pay back loans could instead be helping boost the economy by spending it elsewhere.

"I think that education is one of the best investments that a country can make in its citizens," says Shattuck. "However, I also believe that students need to be realistic and responsible when managing their finances.