Obama Poses Student Loan Challenge To Republicans
WASHINGTON -- President Barack Obama on Friday stepped into the hyper-partisan fight over student debt, warning about the economic dangers posed by rising debt burdens and urging Congress to pass legislation to prevent interest rates on some loans from doubling as a hard deadline looms on July 1.
His speech comes against a backdrop of rising tuition, increasing debt burdens, record relative interest rates on federal student loans and growing worries that student debt -- once seen as a ticket to a college degree and a well-paying job -- may be restraining the U.S. economy as debt-laden graduates curtail consumption.
The average new college graduate carries more than $26,000 in student debt, Obama said, flanked by college students at the White House. “That doesn’t just hold back our young graduates. It holds back our entire middle class,” he said.
Student loan payments “can last for years, even decades, which means young people are putting off buying their first car or their first house -- the things that grow our economy and create new jobs,” Obama added.
If Congress and the White House fail to agree, interest rates on subsidized Stafford loans for undergraduate students are set to double from 3.4 to 6.8 percent on July 1 because of the expiration of a 2007 law that had gradually lowered the rate. The hike would affect about one quarter of new federal student loan dollars. The
His speech comes against a backdrop of rising tuition, increasing debt burdens, record relative interest rates on federal student loans and growing worries that student debt -- once seen as a ticket to a college degree and a well-paying job -- may be restraining the U.S. economy as debt-laden graduates curtail consumption.
The average new college graduate carries more than $26,000 in student debt, Obama said, flanked by college students at the White House. “That doesn’t just hold back our young graduates. It holds back our entire middle class,” he said.
Student loan payments “can last for years, even decades, which means young people are putting off buying their first car or their first house -- the things that grow our economy and create new jobs,” Obama added.
If Congress and the White House fail to agree, interest rates on subsidized Stafford loans for undergraduate students are set to double from 3.4 to 6.8 percent on July 1 because of the expiration of a 2007 law that had gradually lowered the rate. The hike would affect about one quarter of new federal student loan dollars. The
