student loans

h/t ThinkProgress

Editor's note: This post originally appeared on Idealist.org. It has been republished here with permission from the author and Idealist.org.

Guest blogger Heather Jarvis provides education and training “for student loan borrowers and the people who love them.” Here she sums up what college students, recent graduates, and folks considering grad school need to know about the debt ceiling deal.

Last week the House and Senate passed the Budget Control Act of 2011 [PDF] just ahead of the deadline, and President Obama has signed the act into law. Key student aid programs are largely intact, and I am relieved to report that the new law avoids some of the proposed cuts that would have hurt students the most.

There are three main provisions in the debt ceiling deal related to higher education:

• Funding is provided for the Pell Grant program.
• The in-school loan interest subsidy for graduate and professional students is eliminated beginning July 1, 2012.
• "Repayment incentives," or cost reductions earned by certain borrowers, are eliminated for loans disbursed on or after July 1, 2012.

Now for some Q&A…

Q. Students shoulder $4.6 billion of the deficit reduction (so far)?! How is that possible?

The elimination of the graduate and professional interest subsidy and the loan repayment incentives are estimated by the Congressional Budget Office to produce a savings of $21.6 billion. $17 billion of that savings will go to shore up the Pell Grant program, and $4.6 billion will be used to reduce the deficit. Read on for more details about all of these changes.

Q. I have student loans. What steps should I take?

• Always borrow federal student loans first and only consider more expensive private student loans if you must.
• If you are still in school and you can afford it, consider paying student loan interest as it accrues.  You’ll lower your costs over time.
• Choose the repayment plan that makes the most sense for you. Income-Based Repayment (IBR) is a good option for people with low income compared to their student loan debt.
• Pay off your most expensive loans first.
• Find out if Public Service Loan Forgiveness can help.

Q. Is my Pell Grant safe?

Pell Grants are safe for now; the White House indicates that the funding will be sufficient to keep them at their current level of $5,500. If they  had been cut, students may well have had to increase their reliance on student loans. Thankfully, the Budget Control Act shores up the Pell Grant program by providing $17 billion in funding over the next two fiscal years. However, with spending cuts anticipated in the future, Pell Grants remain at risk.

Q. What should graduate and professional students expect?

Graduate and professional students will pay more for student loans. The Budget Control Act eliminates the in-school interest subsidy for graduate and professional students, so these folks will pay more interest over time.  However, it does not eliminate the interest subsidy for undergraduate borrowers.

Subsidized Stafford Loans have historically been available to both undergraduate and graduate borrowers with demonstrated financial need.  In the case of Subsidized Loans, the government pays the interest that accrues on the loan while the student is in college.  Without the subsidy, students must themselves pay the accruing interest as they go, or have the unpaid interest added to the principle amount of their loan and pay it later.

(Ed. note: You can learn more about financial aid on Idealist.org's financing your graduate education page.)

Q. What about repayment incentives?

To encourage borrowers to repay on time, the Department of Education was previously authorized to provide certain incentives, including an origination fee rebate and interest rate reduction.  Borrowers would earn these benefits by making on-time payments over 12 months.  Beginning on July 1, 2012, the Department of Education is no longer authorized to provide these repayment incentives, but may continue to allow an interest rate reduction for borrowers who enroll in payment by automatic electronic debit.

Q. Is it possible that there will be even more cuts to student aid?

Yes. The Budget Control Act requires Congress to come up with a lot more deficit reduction by Thanksgiving.  Additional spending cuts may come in part from higher education. Stay tuned…

—

About the author:

Former capital defense attorney and long-time public service advocate Heather Jarvis dedicates herself to helping students make informed decisions about their student loans. Since 2005, Heather has helped more than an estimated 25,000 students understand and overcome college debt through in-person and online trainings and resources. As Senior Program Manager for Advocacy and Outreach at Equal Justice Works, Heather played a role in the passage of the College Cost Reduction and Access Act, which made IBR and Public Service Loan Forgiveness a reality.

Want to learn more about Public Service Loan Forgiveness?  Register for one of Heather’s popular free webinars and get the scoop.  Heather provides free tools and information for student loan borrowers and the people who love them at www.askheatherjarvis.com.

Here's what's going on today/this weekend.

• Why should holding office be for old people only? One of the most important questions today. The two examples the writer gives are the number of elected officials in Parliament in Canada and Britain who just lowered their voting age from 21 to 18. Which is a joke - in the US people can't run for federal office until they're 25, Senate at 30 and President at 35. Whether someone at 18 could get elected is inconsequential.
  

  The U.S. is an outlier -- which means that our younger voting-age citizens, those aged 18 to 34, do not enjoy full civic enfranchisement compared with their generational peers elsewhere. And our general electorate, by the same token, doesn’t enjoy the liberty of hearing from, evaluating and perhaps voting for (or against) younger adults, whose official candidacies might prove compelling were they not preempted from running.

  Read this whole piece. It's an important argument for why young people are second class citizens when the laws that are passed "on behalf of us" has a greater impact.

• Cell phones throw off poll takers. Not to be disparaging to the good reporters of Chicago but... duah! Let's not focus on the fact that you're late to the party but embrace you showed up at all. Polling is a science - those who exclude young people or reject cell phone only house holds is conducting a poll that is a complete waste of time. Like.... CNN.
• Orange County CA might allocate $3.5M for youth jobs - Which is awesome but read the story and you find out this is a cut in half from last year.
  

  "The money is needed to help youths gain job experience, build confidence and learn skills, said Supervisor Don Knabe, who represents Long Beach and nearby communities.
  "The unemployment rate among young people is staggering," said Knabe, who proposed the funding along with Supervisor Zev Yaroslavsky.

  The summer jobs program has been popular and successful in years past, officials said. This year, however, the county will be on the hook for all of its funding due to the end of the federal stimulus program.

  Last year, roughly $6.5 million from the federal stimulus was doled out to county work force investment boards, including the South Bay Workforce Investment Board in Hawthorne, to help thousands of young people find jobs."

• LTE saying Kudos to young lobbyists who are trying to make civics education a grad requirement. Original story on the young people working to bring awareness to American Government is here.
• The Millennial Generation is among the best ever produced says this guy.... Boy this is kinda happy news today!
  

  "As a life-long teacher and school administrator, I can say with confidence that this generation of students is the best I've worked with in my 20-year career. It remains to be seen if their talent and optimism will allow them to guide our country towards a brighter future than what older Americans predict for them, but if the future for today's youth is bleak, you wouldn't know it by talking to them."

• Interesting... To reach millennials - marketing firms are reaching out to moms
• Evangelicals pissed at young people who are at the Wild Goose festival in NC. Damn kids these days with the hair and the music.... Get off my lawn!!
• Study: Montana could do more to encourage young people says these good people. After ranking 4th in the country in the Rock the Vote young voter friendliness scale Montana is asking how they can be even better. It does my heart good to hear they care so much. Where as other states are working to make things worse.
• How to pay off debt while starting a new business- a UK piece but the takeaways are good for anyone with financial troubles and ambition to be a business owner.
• Reduce Soldiers debt load! Sen. Amy Klobuchar has introduced legislation: the "Servicemember Student Loan Interest Relief Act" along with Republican Senator Jim Inhofe of Oklahoma.
  

  According to the Project on Student Debt, nearly three-quarters of Minnesota college students graduate with debt, and the average debt load is over $27,000.

  Many service members, especially National Guard members . . . had already racked up considerable student debt, often through the Federal Direct Student Loan program. . .

  Under current law, when service members are called up for active duty in a hostile area like Iraq or Afghanistan, they receive a deferment on paying back their student loans for that time period. Service members also receive a waiver on the accrual of interest on their student loans for the length of their deployment in a hostile area.

  But there’s a problem. This benefit applies only to Federal Direct Student Loans dispersed on or after Oct. 1, 2008. It does not apply to loans dispersed before that date. The interest on those loans continues to accrue.

  This new law would level the playing field for all soldiers.

• Students seeking job training skills can end up paying thousands more at For-Profit schools, so know what you're getting into before you start.
• Former Governor and candidate for president Jon (not John) Huntsman plans to reach out to young voters and we say good! You should!
  

  "But most of his short speech was devoid of the kind of rip-roaring quips or emotional appeals expected at a campaign kickoff aimed at generating buzz. Huntsman made three points about the campaign: It will squarely focus on jobs and the economy. It will be polite. And it will reach out to young voters."

Have a good Monday! Come back later today for my report on Maine's voter rights legislation.

• Friend of FM Cryn Johannsen reports on what happens when young people who are in debt with student loans get into an accident and can't work... a really really really sad story.
• Something from the League:
  What would the Green Movement look like if Van Jones were still in the White House?

  That's the question we asked of Cornel West, Malia Lazu, Julian Mocine-Mcqueen, Ethan Case and Chuck Creekmur. Check out 99problems.org for their thoughts.

• The incredibly attractive fake Republican Meghan McCain schools the GOP with 7 tips for Presidential Hopefuls
  

  "...Most young voters my age don't remember Newt Gingrich's claim to fame; after all, the Clinton impeachment trial was so ‘90s.
  What the Republican Party needs is a candidate unafraid to put the president up against the wall and call him out on all the damage his administration has done, especially to the economy, in the last three years."

  This post is around the same time McCain appeared on MSNBC and talked about the coolness factor in Presidential candidates. Politico: You are not cooler than Obama.

  Meghan McCain wants the Republican candidates running for president to stop trying to be cool. She hopes they will step away from the comfort of Fox’s Greta Van Susteren and befriend MSNBC’s Rachel Maddow. And she thinks Tim Pawlenty is kind of wimpy.
  Along with a willingness to challenge the president, she wants candidates to remember that they are “not cooler than President Obama.” “No, you are not. No, seriously, you are not, not even you, Sarah Palin,” she advised. Instead, she wants a Republican to emerge as the “smart candidate, the serious candidate.”

  Of Palin, McCain wrote, “If she enters the race, there will be a proverbial tsunami of media coverage for months. Don’t panic and ride it out. The cream always rises to the top and at some point she is going to have to do something other than come up with clever sound bites.”

  It wasn't Maddow it was that one dude that isn't Keith Olbermann but here's the video:
  
  

  Visit msnbc.com for breaking news, world news, and news about the economy

• 2011 Grads Success not assured
• For Profits deepening debt
• Paying for college without loans. My solution - sell a kidney...
• So this is interesting - when I was pulling the clips last night I came across this article from the West Virginia Metro News: WV takes steps to monitor for-profit schools. The problem is the article is gone and I searched for the headline and couldn't find it. Maybe the for-profits sent people over to break their legs...
• One columnist says that your youth is an indicator that Now's the time to goof off.
  

  "Graduates of 2011, you don't need me to tell you that you are facing an uncertain job market. The economy has been tough, good jobs are scarce, and you likely have heaps of student loan debt. So I get that there might be a temptation to put your job search on hold and continue with your education while deferring your student loans. But (and don't tell my daughter who will be a college freshman in the fall that I am telling you this) let me make one thing perfectly clear:

  Stop going to school!

  Don't go to business school. And don't go to law school. Don't even go to dental school. No, what I want you to do is rule school out. There may be a time to go back to school down the road, in fact, hopefully there will be, but that time is not now.

  And while we are at it, rule out that first big job too. You will have plenty of opportunity - too much opportunity frankly - to work in your life. But not now.

  So, what should you do instead of going to school and getting a job? Let me give you a few ideas:

  For starters, you can goof off."

  I'm all for this ... but I'm sending him my "goof off" bills.

• What to do about young voters who feel abandoned? Good question. I know the numbers are showing the president is losing support among youth and as a result the White House has really stepped up its outreach hoping no one noticed they ditched us when the hard policy was happening (HCR... environmental stuff... etc...). The "hey what about me?!" narcissism of politics and voters.... Is it narcissism when you demand accountability?
  

  "Is there an explanation for such a development? It seems that young people feel the President is no longer focused on them. Other issues have captured his attention including issues related to older people. One young lady summed it up this way: “He made young people feel important, then he got into office and there was no one talking to us.”

• Young Entrepreneurs help fuel economy. Good time to mention Our Time's Buy Young campaign soft launched focusing on businesses that are run by young people that are sustainable and make products from recycled materials. If you sign up you get 30% off or more!
• Ron Paul says young people are tired of the wars
• As many of you know, student financial aid funding is at risk of being cut in high pressure budget negotiations - including eliminating almost 1.5 million students from receiving important grant programs like the Pell Grant. While members of Congress traveling home to their districts this Summer we must hold them accountable by telling them how much student aid means to us.

  Here is a new online action that helps you write a letter to the editor of your newspaper

• Fair Elections news - The latest Voter Suppression Update, provided by FELN and Campus Progress, is available. Some really really good news for Missouri, Maine, Pennsylvania, and North Carolina - but bitter sweat with some sad news about NC and Ohio... so much work to be done to help prevent voter disenfranchisement especially among young voters.

Other ORG news:

• On July 12th the Break The Chain Campaign is hosting the first CARE CONGRESS: the historic public launch of the Caring Across Generations campaign. This is your opportunity to join us at this historic gathering! You can register here.
  

  This year is the first year of the "age wave;" every eight seconds, an American will turn 65. In the coming years, more and more members of our communities will need care, just as more and more workers will need quality, dignified jobs. At a time when we desperately need new jobs, new paths to citizenship, and new solutions to persistent crises in care, a broad coalition of people from all walks of life are coming together to push for change.

  When: July 12 - 9:00 am - 5:00 pm [Meals Included]

  Where: The Washington Hilton - 1919 Connecticut Ave NW

  Who: Secretary of Labor Hilda Solis and 700 people who care

Lots of news today about President Obama and young people. From the looks of things he's up.. then down... then up... then down.

Don't forget if you're at #NN11 today there is a youthy panel:
Changing of the Guard: Youth Leading Democracy
FRI, 06/17/2011 - 4:30PM, M100 FG

• How to lose an internship in 10 ways
• Unpaid Internships and the jobless people fighting for them
• Entries open for SBA Entrepreneurship competition
• An older post I discovered today but totally worth the read - Using Peer Pressure to Change the World
• Letter to the editor for Salon
  

  You are far too generous

  in your assessment of Obama's performance. What you call poor communication I call a complete lack of conviction. Attempting a conciliatory approach is fine at first, but it quickly became clear the Repugs were going to have nothing to do with it. If he had wanted to, Obama could very easily have used the bully pulpit to at least advocate for all the progressive policies he campaigned on, but in the final analysis I think it is clear that was all a bunch of BS and lies. The man has no courage, no vision, no convictions. Totally worthless, and the worst part of all this is the disillusionment of the young voters who thought he would make a difference.

  —tballou

• Billionaire's front group attacks young voters among others
  In speaking about the American Legislative Exchange Council

  "In 2009, ALEC drew up the Voter ID Act to ban university students from using their college-issued ID's as proof of residency for voting. Seven states have adopted this model law, which is intended to bar eligible students from the voting booth. These kids must be disenfranchised, New Hampshire's house speaker bluntly said in February, because they're "voting liberal, voting their feelings, with no life experience." This model bill has been introduced in 18 other states this year in a rather obvious ploy to hold down the student vote in the 2012 presidential election."

• From the Miami Herald students facing unemployment with student loans
  
• Young voters aren't the only ones "Souring with Obama" it seems Young Environmentalists Displeased with Obama
  

  "The displeasure amongst young environmentalists does not necessarily reflect the feelings of young voters nationwide however. In a Harvard Institute of Politics poll, 55% of all voters between the ages of 18 and 25 approve of the President’s job performance. Amongst college students, the percentage raised to 60%. But despite high approval ratings, young voters are hesitant to back the President in the 2012 elections.

  The most important issue for these voters is the economy. In February of 2011, 43% feel their economic situation is “very” or “fairly bad” and 22% are currently looking for work. When asked whether they will vote for him in 2012, only 38% say they will while 25% say they plan to vote for his Republican opponent. The rest are unsure. While young voters have stuck beside President Obama, it seems the spirit of “Yes We Can” has faded."

• The other Obama's however are doing great work with young people! Michelle Obama Africa Trip Focuses on Youth Leadership
• Young Voters win at GOP Debate
• Red State blogger calls Social Security a Ponzi Scheme and instructs young voters to Opt Out
• Here's an important notation to mention: US Supreme Court Rules a Youth's Age is Relevant in Miranda Analysis. More specifically
  

  "Justice Sonia Sotomayor wrote the majority opinion (PDF). “It is beyond dispute that children will often feel bound to submit to police questioning when an adult in the same circumstances would feel free to leave,” she wrote. “Seeing no reason for police officers or courts to blind themselves to that commonsense reality, we hold that a child’s age properly informs the Miranda custody analysis." You can read more about the specific case at the link.

• 4H Shout Out: Youth learn Responsibility and Leadership through raising Livestock
• Congressional personal financial disclosure forms reveal some still have student loan debt... welcome to my world. You'd think these members would be the ones leading the charge to fix it!
  

  "Nevertheless, the reports offered reminders of the more typical financial burdens faced by most Americans. Many lawmakers reported unpaid student loans or hefty credit card balances. One cash-strapped freshman put himself on his campaign payroll to make ends meet last year."

• Should you start a business right out of college?
• And today came an email from the White House:
  

  Good evening everyone,

  As many of you know, last week, President Obama met with a number of inspiring young Americans here in the West Wing to de-brief on the “100 Youth Roundtables” Initiative. In that session, young folks reflected on the feedback given to the White House during the course of the initiative. They discussed issues regarding environmental regulations, community organizations, legislation that the President supports, and how to really make a difference all around. To follow up on that feedback, the President announced a new series that will take us through the summer, called, “How to Make Change.” Check out video of his announcement here.

  This series will specifically foster a conversation between young Americans, advocates, and the White House on the issues that matter to us all. What are specific deliverables you would like to see? What tools can we offer you so that you can achieve what you set out to achieve? Let us know! The full schedule for “How to Make Change” will be announced next week, so stay tuned.

  Have a good Thursday night,

  Kal

• Starting off with some health news... One study recently found that many young people with Type 2 diabetes have impaired cardiovascular function due to stiffened arteries.
• Kurt Metzger's "Talk to Young People about Sex" album will be released on Comedy Central on June 28th
• We need to see more of this: An Iowa City city council candidate is running to give young adults a voice.
• Call it the scone rush? For struggling young people, one cafe in the Chicago area intentionally creates opportunities for recently imprisoned youth to get back on their feet.
• Obama again reaching out to youth through youth roundtables.
• New York's state financial aid agency offers college students advice on how to strengthen their financial fitness following college.
• The San Francisco Chronicle offers its own advice.
• But before you graduate from college, you need to succeed there. Here are some tips for first year students in your first year.
• Entrepreneurship 101: A guide for new college grads looking to fly solo
• Grants that help youth be their own bosses? Interesting.
• The trials and tribulations of the intern and other tales of unpaid labor
• The for-profit price of student loans (and it's not stormtroopers on a collection mission. At least in this story).

• Rock the Vote has a young voter score card for states
• Iowa is one of the top states in the country for access to voting and ease of voting for youth. Other states include North Carolina and Montana
• Why millennials can’t start their careers and baby boomers can’t end theirs.
  

  "It’s hard to say this spring whether it’s more difficult for the class of 2011 to enter the labor force or for the class of 1967 to leave it.

  Students now finishing their schooling—the class of 2011—are confronting a youth unemployment rate above 17 percent. The problem is compounding itself as those collecting high school or college degrees jostle for jobs with recent graduates still lacking steady work. “The biggest problem they face is, they are still competing with the class of 2010, 2009, and 2008,” says Matthew Segal, cofounder of Our Time, an advocacy group for young people.

  At the other end, millions of graying baby boomers—the class of 1967—are working longer than they intended because the financial meltdown vaporized the value of their homes and 401(k) plans. For every member of the millennial generation frustrated that she can’t start a career, there may be a baby boomer frustrated that he can’t end one."

• Care2 picks up our debunking of the "empowerment" of debt among youth with their story: Debt may not be so empowering after all
• After yesterday's story about the Iowa State Senator who told students lobbying for fair tuition to "go home" Campus Progress has launched a petition asking people to demand Republican Iowa State Sen. Shawn Hamerlinck apologize to Iowa's youth.
• WH reaches out to young voter roundtables

  

• This is so depressing - Are anti-depresents over prescribed to youth?
• Youth who watch MTV's Pregnancy Programs are more likely to support abortion according to a new survey (PDF) of viewers. Full disclosure ... after watching this show I believed very strongly in sterilization...
  

  "71 percent of "millennials" (ages 18 to 29) have seen a show about pregnancy.

  And 29 percent of millennials had seen, specifically, either "Teen Mom" or "16 and Pregnant." Among Americans overall, that number drops to 17 percent.

  But regardless of age, the study found that 65 percent of those shows' viewers support abortion -- among the general public, 56 percent support it."

• By that same token here is One Millennial's take on New Research around LGBT Rights and Abortion - The story on the research itself shows that youth tend to support choice and believe in its legality but believe its morally wrong. This will surly be critical messaging for choice groups in upcoming elections as they make their case to young voters.
  

  "Just under half of 18- to 29-year-olds say that abortion is morally acceptable, but six out of 10 say it should be legal in most or all cases, and nearly seven out of 10 say it should be available locally."

• NC House OKs blocking low-interest college loans
  

  "North Carolina's House of Representatives is sidestepping Gov. Beverly Perdue's veto by trying to allow more than two dozen community colleges to refuse to offer low-interest student loans. . . .

  College presidents say they worry they'll be cut off from federal financial aid programs if student loan defaults go too high. Community Colleges vice president Linda Weiner said each campus is responsible for student financial aid issues and presidents have the leeway to act on their concerns."

• By that same token - Wells Fargo has launched a fixed interest rate student loan program - I assume to compete with federal student loans? If you consolidate your federal student loan and lock in a rate that rate never changes. In 2007 Congress passed a bill that helped bring more sunshine to student loan companies. That Congress continued with a huge student loan overhaul and the fight continues today....
• More on the Student Loan bubble
• Personal story of a Tennessee youth who is young, gay and homeless
• The AFL-CIO hosts its second annual Young Workers Summit in Minneapolis
• Commentary: Is college worth it?
• The Roosevelt Institute is having a reception in DC this evening if you want to go here are the details
• The Senate HELP Committee released a staff discussion draft of Title I of the proposed Workforce Investment Act (WIA) reauthorization bill. SparkAction.org will feature Millennial stories on it as this moves forward.
• From the League of Young Voters 99Problems.org blog they pose the question - is our generation post racial? Given that we're the most diverse generation in American history this is a great question to ask.

Reprinted with permission from C. Cryn Johannsen at All Education Matters. This is a fantastic piece Sarah linked to earlier today; we wanted to make sure everyone saw it in its entirety.

Yesterday morning few people were aware of what had happened to Kenneth Wright's rights in Stockton, California. Thanks to the hard work of numerous advocates, however, that changed within hours of a local news story about the use of excessive force.

People across the country - and even the globe (my own work was being retweeted by people in Stockholm and London) - learned that Wright's door was broken down by federal agents, he was handcuffed in his underwear, and thrown into a patrol car for 6 hours. Although the initial report from News10 suggested that the warrant for Wright's estranged wife was for her defaulted federal loans, the story quickly changed over the course of the day. (News10 took the story down once it went viral and has provided an updated version that discusses the use of excessive force. There is no mention of defaulted loans. In addition, News10 released the warrant that indicates that fraud was being committed. However, it is truncated and the entire warrant remains sealed).

It is common knowledge among higher education finance experts that the Department of Education's Office of Inspector's General (OIG) conducts search warrants. Moreover, these cases, as Press Officer Sara Gast explained to me in a recent email, are generally related to investigations of "bribery, fraud, and embezzlement of federal student aid funds." Such investigations are generally limited, Gast told me, to 30 - 35 search warrants a year. But the general public is not privy to this type of activity. (When I followed up with Gast by phone, she provided me with Press Secretary Justin Hamilton's direct line. As of this writing, a call from Hamilton has not been returned).

While Wright's estranged wife may be involved in fraudulent activity, there are two crucial points about this unfolding story. First, it spread like wildfire throughout the blogosphere because it was fueled by fear. Bloggers on the left and the right picked up on the story, and that led to major media outlets putting out reports, too. There is good reason for why it became so hotly discussed. There is a growing number of indentured educated citizens who are fast approaching financial disaster. Thousands and thousands of them have shared their stories with me over the past 2 years. The use of force by the Department resonated with countless readers. Many of them wrote on Facebook pages and tweeted, "It's scary. What if that happened to me?" . . . "I'm close to defaulting on my loans. Will the Department break down my door?"

We all know that there is no way out of this debt, especially if you fall on hard times. The system has been rigged in such a way that allows companies, like Sallie Mae, to benefit from keeping people in debt. Sallie Mae has $146 billion of federal loans on its books. One analyst said, "They have this cash cow which is the legacy portfolio." Hear that, folks? They are making money off of indentured educated people! Make no mistake - they don't want this 'cash cow' to go away. No one talks about the fact that FFELP is still alive. The administration might have put an end to it, but those loans are still out there and part of these loan sharks' portfolios. So, if you default on any federal loans, you're life is pretty much ruined, whereas the IRS has the power to resolve issues with distressed taxpayers. Both parties can come up with a solution and move on. Student debtors have no such luck. But since we're seen as a 'cash cow,' why would anyone in power want that to change? I'm sure those guys over at Sallie Mae, who live in luxurious mansions on the east coast don't want this to change. Neither do the schools. They all control the money, whereas the rest of us are victims of these hucksters. But I digress.

Second, the use of such excessive force was uncalled for. Why an individual who is being sought for fraud warrants a SWAT team -- as it was originally reported -- suggests how far right this country has moved. Wright must have been traumatized when he was handcuffed in his underwear and thrown into a patrol car for 6 hours. His children, who are 3, 7, and 11, had to have been disturbed by the incident as well.

Moreover, this story has fueled numerous and ongoing conspiracy theories. But the elements of the story, along with a great deal of speculation (which was justified), lent themselves to that. It should come as no surprise since the characteristics of American conspiracy theorists are the same as Christian fundamentalists. Fear is also what adds fuel to conspiracy theorists' fire. (They also the need to simplify complex situations. In addition, conspiracy theorists oftentimes - not always - fail to comprehend systemic issues and place too much emphasis on individual agency. Mind you, I am not suggesting that conspiracy theorists are unintelligent, but I do wish to make clear that I do not identify with this type of thinking).

One thing is clear, regardless of how you think or how you identify yourself politically, the Department is tone deaf and reviled across the board. They are as hated, as I've already stated, as Sallie Mae. I had always thought that, but yesterday's outrage drove that home. If they don't get it together, along with the politicians and self-interested lobbyists in DC, we might very well experience a revolution in this country as well. People don't like it when they feel that their future has been stolen from them. A lot of folks want their future back. DC better start listening . . .

We know what democracy means. We won't settle for economic slavery.

When I saw this article was posted by Amanda Fairbanks at Huffington Post I immediately turned my head and thought…. surly this can't be true. I'm in debt - I've been in debt since college - both credit cards and student loans. (I was irresponsible) My debt has prevented me from taking jobs I wish I could take because I can't afford them. It's prevented me from doing a lot of things like traveling the world (a dream of mine), going to law school (a previous dream of mine), and grown up things like … not moving states every year or so because I'm looking for a new or higher paying job or better benefits. I know I'm not alone.

Surly - SURELY those other young people out there wouldn't see this as a good thing. And certainly this wouldn't be something that would increase someone's self esteem?! I saw a great documentary on CNBC about students in debt that can't sleep at night and sob on camera because they feel so lost and afraid.

Via Fairbanks piece:

""Debt can be a good thing for young people -- it can help them finance goals they couldn’t otherwise, like a college education,” said Dwyer, whose findings appear in the latest issue of Social Science Research, an academic journal."

When looking up information on this study I found that you had to pay $31.50 to the damn Social Science Research magazine er research book or whatever just to see the methodology behind the survey. I put it on a credit card…. Email me if you want a free copy I'll give you mine....

Here's what I learned on page 732 under the "Data and Methods" section.

"We use multiple years of the National Longitudinal Survey of Youth 1979 – Young Adults sample (NLSY79-YA) up to 2004 to evaluate the impact debt holding has on youth during a time of high credit use. The NLSY is administered biannually by the Bureau of Labor Statistics and the Young Adults sample is made up of the children of female respondents of the 1979 NLSY cohort…..

We limit our sample to youth at least 18 years of age, who are not in high school, and are responsible for at least some of their financial obligations to ensure that all respondents included in the analysis were eligible to access credit, resulting in a sample of 3079 respondents. The age range for this group is from 18 to 34, but the majority of the respondents are in their early to mid-twenties, with a median of 22 years and 80% aged 25 or younger. We control for age in all analyses and conduct supplemental analyses stratified by age, which we discuss further in the results section."

So, how do you rank good or bad self-esteem?

"…The Pearlin Mastery Scale is composed of seven items intended to assess respondents’ sense of control over their life: ability to solve problems in life, feeling pushed around or bullied, amount of control they have in their every- day lives, ability to do what they set their minds to, amount of helplessness when dealing with everyday problems, sense of control over what happens in the future, and ability to change important things that happen in their lives (Pearlin and Schooler, 1978). The alpha value for the mastery scale is .68. The Rosenberg Self-Esteem Scale includes ten items to assess respondent self worth: I am a person of worth; I have a number of good qualities; I am inclined to feel I am a failure; I am as capable as others; I feel I do not have much to be proud of; I have a positive attitude; I am satisfied with myself; I wish I had more self-respect; I feel useless at times; and I sometimes think I am no good at all (Rosenberg, 1989). The alpha value for the self-esteem scale is .83. Measures were coded so that a higher value indicates greater mastery or self-esteem."

I take issue with this - because I'm satisfied with myself, I have done a lot I can be proud of, and I don't feel like a failure - but I feel a lot of anxiety around my debt and I've made decisions based on that debt. Yet by this classification system I would have high self-esteem around my debt. That's not exactly a great methodology...

Here's the kicker from page 733

"Because many respondents have no debt, we create spline functions for both education debt and credit-card debt. The spline splits each form of debt into two component variables: (1) a dummy variable indicating whether the respondent has any debt, and (2) a continuous measure of the total debt held with zeros for non-debt holders. The simultaneous esti- mation of the effects of these two variables models debt more accurately than a simple linear function, enables us to distin- guish the effect of having any debt from the effect of having more or less debt, and reduces the bias due to the skew of the underlying debt variables (Wojtkiewicz, 2003)"

Seriously? No….. seriously?

First of all - those who graduated between the years 1979-2004 are probably not in debt anymore! The only people I can see who MIGHT still be in debt would be people who graduated in the last 10 years with their BA and didn't get an advanced degree. Graduates in 2004 had an average rate of 66.4%. Debt keeps going up....

"About a decade year before that, it was less than half who had student loans to pay back. Also over that past decade, the debt levels for graduating seniors with student loans more than doubled from $9,250 to $19,200, which is an 108% increase."

Secondly, that dollar amount also has increased. In 2004 that number of debt was $17,600. Today that number is closer to $25,000 asFairbanks quotes.

So, essentially - a majority of these people had lower amounts of debt than today - have had more time to pay off that debt, and graduates prior to 2004 weren't being hit with the economic recession that we've been dealing with for the last since even 2006 and 2007.

This whole study seems remarkably out of touch with TODAY's youth who are saddled with high costs of education, high unemployment, predatory lending, and the Department of Education's SWAT team coming after them for loan defaults.

I call this a BS study for those reasons. I don't think it's helpful to try and pretend that young people are positive about being poor, in debt, jobless, and without health care. It does a serious disservice to economic or education policy and to those of us who do advocacy around youth or economic issues for young people.

This week President Obama signed the Student Aid and Fiscal Responsibility Act. This common-sense reform that will generate an estimated $80 billion in savings by bypassing for-profit lenders in the loan process and will instead provide loans directly to students. This reform makes government more efficient and invests the savings in the education of young Americans without raising taxes or adding to the deficit, this is the largest investment in higher education in history that will put the country on track to have the highest proportion of college graduates in the world by 2020.

However the Kansas Republican delegation continues to put the interests of Wall Street, banks, and lenders ahead of the interest of Kansas students and their families. This law will not only make college more affordable but it will also save taxpayers billions of dollars.

The Health Care and Education Reconciliation Act will eliminate wasteful subsidies to private bankers by switching to a system of direct lending of federal student loans.

It will make historic investments in America’s workforce by making college dramatically more affordable – at no cost to taxpayers. I will invest $36 billion over 10 years to increase the maximum annual Pell Grant scholarship to $5,550 in 2010 and to $5,975 by 2017. It will reduce the deficit by $68 billion over the next 11 years and meets Pay-As-You-Go fiscally responsible principles.

By standing against this law Lynn Jenkins, Todd Tiahrt, Jerry Moran and Sam Brownback have once again turned their backs on the Kansans they represent. Once again their talk of Kansas values and fiscal responsibility has proven to be nothing but empty words.

It’s unfortunate they don't support a law that will make government more efficient and effective, will allow more Kansans to pursue higher education at lower cost, and allow Kansan families to keep more of their money.

Colin Curtis
State President
Kansas Young Democrats