It’s time to get real. I’m a 20-something, second-generation, first-born Asian American/Pacific Islander (AAPI) woman. My parents never went to college. When it was time for me to fly the coop and obtain that “American Dream”, I did what I thought was a good idea. I took out both private and federal loans. Fast forward a few years and today I’ve racked up a sizable amount of debt. Just in student loans.
There are people out there who will unsympathetically say, “You signed the dotted line. You knew what you were getting yourself into.” Sure, I guess. I mean if I took a huge bite out of a ghost chilli pepper, the world’s hottest chilli pepper, I know the repercussions would include gallons and gallons of milk being downed, me sweating profusely, and my taste buds screaming for oh-holy-mercy. So I guess if you equate student loans to eating, then I might have known what I was getting into.
But unfortunately student loans aren’t menu items. You can’t bite into them and get a similar result to the previous individual who took a taste. You don’t know what you’re going to get after college. Will you land a job? Will that job pay enough? Will you have to decide each month between buying groceries or making a loan payment? Will you be able to defer long enough to get a better paying job? There are way too many variables at play creating a multitude of possibilities for students.
Then, there are people out there who argue that students just need to pay back their loans. I hate to break it to you, but YES, we want to pay them back. But why does education cost so much? Our country’s student debt already tops $1 trillion. It is alarmingly too easy for students to rack more than $150,000 in debt to finish undergrad and graduate degrees; degrees that would keep our economy growing and moving.
With the cutbacks on education, our students today are already facing higher tuition fees. But to make it worse, on July 1st, the interest rate on new subsidized student loans will double from 3.4% to 6.8%. To culturally appropriate a saying from someone else - STUDENT LOAN RATES ARE TOO DAMN HIGH. If banks can get loans through the government at a rate of 0.75%, why are Republicans hell-bent on making students borrow at 6.8%?
The answer: to balance the budget! I say it again. The Republican Party is using students to balance the federal budget. The same students whose parents worked way too hard to save just enough. The same students who want to become the first college graduates of their families. The same students who want to cure cancer, design the next big tech craze, or engineer clean energy solutions. Those students and their debts are the solution to the federal deficit.
The Department of Education already makes $51 billion a year in interest alone. That’s more than the profit of any Fortune 500 company. This is why I support Senator Warren’s Students Loan Fairness Act. This bill allows students to receive the same cushy deal that the government hands to the big banks, a 0.75% interest rate for federally subsidized loans, for one year. As Senator Warren and Congressman Tierney wrote:
“But students are just as important as banks to a strong recovery...If the Federal Reserve can lend trillions to financial institutions at low rates to grow the economy, surely it can float the money that will keep student loan payments low, keep us competitive, and grow our middle class.”
I dig that. Let’s give our students a more positive range of possibilities when they graduate.
For more, check out the recent video from POTUS on Student Loan Rates.