Arne Duncan
Washington Post
2/26/2010
For too long, bankers have gotten a free ride from the U.S. Department of Education.
Under current law, taxpayers provide as much as $9 billion each year to subsidize guaranteed student loans issued by banks. The banks earn profits on the interest; if students default, taxpayers take the loss, not the banks. In other words, working Americans pay while bankers get rich.
Meanwhile, educators, engineers and computer scientists — the backbone of the new economy — face crushing debt from six-figure college tuitions. A study of national postsecondary student aid found that in 2008, two-thirds of college seniors graduated with debt averaging more than $23,000. That number will rise as public and private college tuition costs escalate.
The banks have had plenty of help with government bailouts and other subsidies while working families and students are increasingly squeezed. President Obama wants to eliminate the subsidy for banks and use that money to help poor and middle-class students and adults attend college.
The president also wants to strengthen community colleges, give grants to states that improve college completion rates and boost early-learning programs. He wants to lower maximum monthly payments for student loans from the current 15 percent of income to 10 percent to make college debt more manageable.
The article continues at the Washington Post.
Arne Duncan is the U.S. secretary of education.
