Refer to the following excerpt from the speech:
“To make college more affordable, this bill will finally end the unwarranted taxpayer subsidies that go to banks for student loans….And let’s tell another 1 million students that when they graduate, they will be required to pay only 10 percent of their income on student loans, and all of their debt will be forgiven after 20 years — and forgiven after 10 years if they choose a career in public service, because in the United States of America, no one should go broke because they chose to go to college.”
Can you tell me how exactly these proposals, when put into action, are going to help our economy? I understand that this will help create a greater base of an educated workforce and will help bring in more efficient government employees, but what other positive aspects do these bills have?
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{ 8 comments… read them below or add one }
“Can you tell me how exactly these proposals, when put into action, are going to help our economy?
…I understand that this will help create a greater base of an educated workforce and will help bring in more efficient government employees”
You already explained yourself how this would help the economy in the long term.
The best resource of any nation is a talented, well-educated workforce.
greater base of an educated workforce
That will help the economy. This is the age of information. America is no longer 70% farmers like it was in the 30’s. We are leaders in technology and this will help us continue to be. People wont be as scared to take the financial risk of going to school.
They force everybody to deal with the IRS, because the only way you’re going to prove that you are spending 10% of your income, and thus be eligible for these benefits, is if you file the illegal 1040 forms. The IRS has seen a massive drop in return filings and are desperate to find a way that is cheaper than ‘enforcement’ to force Americans to pay unConstitutional income taxes.
There is no law requiring the average American to file a 1040. 67 million do not.
EDIT: Treetops, please get your head out of the canopy and back down here to the real world.
I like Obama but this is nuts. Instead of the banks ripping us off for subsidies for student loans, we’re now going to give the money directly to the students. Why should my money go to letting someone who’s been a surgeon or an attorney for 10 or 20 years help pay off all of his/her student loans? Also, where does he think 1 million students are going to get jobs when the college graduates today can’t find work.
The workforce makes money and pays taxes and spends their money in the local economy. Theoretically, a higher level of education will allow one to earn a larger paycheck, to pay more taxes and spend more in the economy.
The question you should be asking is why do taxpayer subsidies go to banks in the first place? By the statement they are “unwarranted”. They are a private business, not a government entity, regardless of the bailouts. And why are students being brainwashed to go that far into debt when over 80 percent will never actually work in the field that they’re educated in? Why are colleges allowed to charge that much money for what will be for most a substandard education? And how are these financial institutions going to stay in business if billions of dollars of debt are going to be “forgiven”, that’s not government money, that’s money that these banks have provided for educational purposes with the promise of repayment. These are the answers I would ask…just sayin.
typical. all bu–sh-t. just make it sound good and the romans will believe.
Sounds somewhat ‘pie-in-the-sky’. I don’t know how it will make colleges more affordable; a loan is a loan, no matter what institution services it. Would need to know more details of the ‘program’ before I could speculate about the effect on the economy.
Some people graduate with low debt, others with debt well over $200,000. What if they’ve screwed around and haven’t been diligent about working down the debt, do you think it’s fair to write it off after 20 years? I do not.
What I like about gov’t financing of student loans is that the IRS can be used to enforce repayment, so there will be more paid back. That’s better for the bottom line. I’ve known people who don’t bother to pay off their student loans, and don’t even feel guilty about it. Right now banks don’t try very hard to collect because the loans are government guaranteed. Getting the IRS involved will make a difference. The IRS will have lots to do.
Actually, they will create a drag on tax payer money since we will be forgiving a lot more money then we take in. From what I understand, for the longest time the student loan program could only lend out what it brought in. Now we will be changing that creating even more burden on the Federal Government to pay for this program.
Also, if you teach responsibility to college students that they don’t rack up greater debt then they can afford based on their degree then that helps also.