{"id":1430,"date":"2014-02-18T23:59:58","date_gmt":"2014-02-18T23:59:58","guid":{"rendered":"http:\/\/www.jlpp.org\/old_blog\/?p=1430"},"modified":"2014-02-18T23:59:58","modified_gmt":"2014-02-18T23:59:58","slug":"can-congress-rescue-students-from-drowning-in-debt","status":"publish","type":"post","link":"https:\/\/publications.lawschool.cornell.edu\/jlpp\/2014\/02\/18\/can-congress-rescue-students-from-drowning-in-debt\/","title":{"rendered":"Can Congress Rescue Students from Drowning in Debt?"},"content":{"rendered":"
\"C\/o<\/a>
C\/o Shutterstock<\/figcaption><\/figure>\n\nLate last summer, President Obama signed the Bipartisan Student Loan Certainty Act of 2013<\/a> (\u201cthe Act\u201d) into law in hopes of rectifying the severe student debt problem. Congress enacted the law after student loan interest rates doubled<\/a> on July 1, 2013, leading to an educational student debt crisis. The Act aims to prevent the already overwhelming student loan debt from rising by lowering interest rates on undergraduate and graduate student loans. After a month of arguing over the proposed legislation, Congress, acting in rare bipartisan fashion, compromised and passed the bill at the end of July. As President Obama signed the bill into law, Congress applauded. The clapping of both parties revealed that Congress felt satisfied with their ability to work together to pass the Act. Should Congress really have celebrated its passage? Is Congress\u2019 job regarding the student debt crisis complete? Absolutely not.\n\nEven with the Act in place, student debt will remain a critical problem that lawmakers will need to address again. One single law cannot and will not solve all of the American educational debt problems. First, this new law does not help out individuals who have already paid high interest rates on their student loans or who have already defaulted. Student debt exceeded 1.1 trillion dollars<\/a> before the President even signed the bill, a sum that exceeds the $798 billion<\/a> of credit card debt currently outstanding in the United States.<\/span> The amount of debt severely impacts many Americans, as individuals must postpone investing<\/a> into other areas of their lives such as houses and cars, to name a few. Although the Act aims to decrease the rate of debt that individuals will possess in the future, it does not eliminate the tremendous amount of debt that already exists. In addition, unlike other types of debt, \u201cthere is almost no way out of student loans if you can\u2019t repay.\u201d<\/a>\n\nThe new legislation lowers student debts to some extent, but the interest rates are still significantly high. Also, under the Act \u201cfederal loan rates could dramatically rise\u201d when the economy improves. <\/a> With loans increasing, the brief period of low rates will be of little comfort<\/a>. Hence, the new law does not completely cure the student debt problem.\n\nSo what are some potential solutions for dealing with the problems not addressed by the Act?\n\nThe Department of Education recently announced that it would start to contact individuals<\/a> who are struggling to pay back their student debt and educate them about various options available to assist in paying it back. The announcement reflects the government\u2019s concern that thirty-five percent of student borrowers<\/a> under the age of thirty have defaulted on payments. The Public Service Loan Forgiveness Program<\/a> is one such program, which forgives education debt for individuals who work in public service for ten years. The government\u2019s effort to educate people about student loan debt will hopefully assist individuals in making loan payments successfully without defaulting. However, the government should also attempt to inform individuals of the options available to them when they first borrow the money, rather than waiting until students face trouble after graduation. Moreover, these instructions need to be clear throughout the process. For example, instead of \u201c[having] to be a genius to figure out what to do,\u201d<\/a> borrowers should know exactly how to join government or private programs that will assist in paying back debt. The programs available to student borrowers cannot play their intended role of assisting individuals with paying their debt if people do not understand how to participate in the programs.\n\nThe current loan repayment programs can still be problematic, however, as not everyone has the ability to join the programs, and even those who do may face financial hardships that render the programs impractical. For example, the Public Service Loan Forgiveness Program requires individuals to live ten years on a low salary while still paying a certain amount of their student loans\u2014not an easy task with the expensive costs of living.\n\nThe government must do more than simply notify individuals of programs available to pay back debt. Some proponents suggest that future students should go to community college<\/a>s in order to avoid the high cost of higher education with no guarantee of securing a job<\/a> upon graduation. It is not fair for future students to lose the opportunity of attending a four-year institution simply because of tuition rates. Universities should take responsibility for the rising cost of education and make efforts to lower tuition<\/a>. With tuition costs lower, students will have fewer loans to request and consequently less debt upon graduation.\n\nAlthough the Act is a step in the right direction, now is not the time for the government to stop working to find solutions. Student debt still remains a significant problem for present, former and future students. Even President Obama admitted,<\/a> \u201cIt\u2019s all a good start—but it isn\u2019t enough.\u201d Members of Congress echoed the President by acknowledging the national problem<\/a> of student debt. Unfortunately, Congress\u2019 well documented inability to work together, which has even resulted in a federal government shutdown, does not indicate that Congress will be able to cooperate in passing additional student loan legislation. Next, Congress will review the Higher Education Act in 2014<\/a>. This Act determines federal student aid and provides an opportunity for legislators to re-visit and reform student loan laws. Let\u2019s hope Congress takes advantage of the opportunity.","protected":false},"excerpt":{"rendered":"

Jessica Flores analyzes the student loan debt crisis in the United States and explores potential solutions to this national problem.<\/p>\n","protected":false},"author":1,"featured_media":1434,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[28],"tags":[208,358,451,533,777,970,1266,1460],"class_list":["post-1430","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-student-blogs","tag-bipartisan-student-loan-certainty-act","tag-congress","tag-debt","tag-education","tag-higher-education-act","tag-loan-forgiveness","tag-public-service-loan-forgiveness-program","tag-student-loans"],"acf":[],"_links":{"self":[{"href":"https:\/\/publications.lawschool.cornell.edu\/jlpp\/wp-json\/wp\/v2\/posts\/1430","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/publications.lawschool.cornell.edu\/jlpp\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/publications.lawschool.cornell.edu\/jlpp\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/publications.lawschool.cornell.edu\/jlpp\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/publications.lawschool.cornell.edu\/jlpp\/wp-json\/wp\/v2\/comments?post=1430"}],"version-history":[{"count":0,"href":"https:\/\/publications.lawschool.cornell.edu\/jlpp\/wp-json\/wp\/v2\/posts\/1430\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/publications.lawschool.cornell.edu\/jlpp\/wp-json\/wp\/v2\/media\/1434"}],"wp:attachment":[{"href":"https:\/\/publications.lawschool.cornell.edu\/jlpp\/wp-json\/wp\/v2\/media?parent=1430"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/publications.lawschool.cornell.edu\/jlpp\/wp-json\/wp\/v2\/categories?post=1430"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/publications.lawschool.cornell.edu\/jlpp\/wp-json\/wp\/v2\/tags?post=1430"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}