Student Loan Reform Fight Broader For Obama Than Interest Rate Debate

Student Loan Reform Fight Broader For Obama Than Interest Rate Debate:

Student Loan Reform Fight Broader For Obama Than Interest Rate Debate

by Joy Resmovits

WASHINGTON -- On Tuesday, congressional Democrats announced plans to introduce legislation that would extend the current low interest rates on government-subsidized student loans, responding to the major public relations push from President Barack Obama. But while the issue has ginned up cable news chatter and drawn attention to a host of grassroots student debt relief efforts, it is a relatively minor front in the administration's college affordability battle. In 2010, Obama took a much bolder and largely overlooked step, boosting direct aid to low-income students by eliminating $60 billion in federal money given to banks to provide loans to students.

Consumer advocates had been urging Obama's student-lending reform for decades, but the bipartisan lobbying clout of student loan servicing giants like Sallie Mae had prevented legislation from going anywhere in Congress. Today, nearly two years after the law passed, education access advocates have another target: relief for the millions of graduates drowning in debt. Tackling that problem involves another bruising political battle with banks -- and the White House has instead chosen to focus on affordability programs.

While Republican frontrunner Mitt Romney has publicly supported Obama's plan to prevent the interest rates on