After President Barack Obama proposed a plan Wednesday night in his State of Union Address to cap student loan payments, members of the MSU community expressed mixed emotions toward the plan. Obama’s plan would cut loan payments to 10 percent of a borrower’s income after graduation and forgive student loan debt after 20 years.
“It’s a really good deal for students,” said Rick Shipman, director of the MSU Office of Financial Aid. “The real advantage of the program is that it lets a person choose employment that they really care about — regardless of how much they borrowed — instead of worrying about getting a job that pays as much as possible so they can repay their loan.”
Some students thought the plan was a welcome change for graduating college students.
“Since most people are going to college because of how the economy is, I think it would be helpful because college is expensive,” said arts and humanities junior Erin Degroote.. “My friends have so many loans and are worried about paying them back. We’d go to school longer if it wasn’t so expensive.”
The new plan is estimated to cost between $1 and $2 billion federal dollars over the next five years, said Mark Kantrowitz, the publisher of FinAid and FastWeb Web sites.
Although some students supported Obama’s plan, others questioned whether it is the government’s responsibility to financially support college graduates.
“I don’t think the government is totally at fault when we are putting ourselves in debt,” political science and pre-law junior David Feenstra said. “It’s just as much our problem as the government’s problem.”
Currently graduates make a monthly payment of 15 percent of their income and loans are forgiven after 25 years. For those who work in the public sector, loans are forgiven after 10 years and this will not change, Kantrowitz said.
Obama also proposed a $10,000 tax credit for families who pay for four years of college. He also said he would increase the availability of Pell Grants. State Sen. Alan Cropsey, R-DeWitt, said the federal government cannot afford these measures given the country’s economic state.
“Why are we saying (a college education) needs to be made cheaper and cheaper?” he said. “Government can’t just hand it out in a platter without having repercussions somewhere else.”
Because of the elimination of the Michigan Promise scholarship and other financial aid funding, Michigan students need any assistance the federal government can provide, said State Rep. Joan Bauer, D-Lansing, who chairs the Higher Education Appropriations Committee.
“It’s very important that we do everything we can at the federal level and at the state level to make college more affordable and accessible,” she said.
International relations and comparative cultures and politics sophomore Jake Radecki said he was glad Obama focused on the middle class.
“The fact of the matter is that so far his stimulus plan hardly benefited the middle class,” he said. “I can say that I am glad he is kind of restructuring his agenda around economic problems.”
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