We all mostly know why so many students are struggling under a mountain of college loan debt: Between 1982 and 2007, tuition and fees increase 439% while the median middle class family income rose 147%. This according to the National Center for Public Policy and Higher Education. Meanwhile, thanks to state budget cuts to fund higher education, leaving public universities to jack up their tuition on their own- the price of in-state tuition at the typical public university has increased more than 5 percent annually in the past ten years. And it jumped 15% between a 2008 and 2010 alone.
No wonder so many recent college grads, as well as current students are barely treading water. Many sincerely believed they'd catch a break as congress recently came into session before the 4th of July recess, to pass legislation that would keep the interest on new Stafford loans at 3.4% instead of spiking to 6.8% That difference is estimated to save some 7.4 million students an average of $1,000 each over the next year.
The problem is that this relief actually ENDS after only one year. As noted in The Sunday Denver Post ('Student Loan Relief Only Temporary', July 1, p. 13A) students will get relief for a year but come next summer those interest rates will automatically jack up to 6.8%. Congress critters, mainly Reeps, weren't apologetic, insisting this wasn't their doing but rather that "lawmakers approved the automatic rate increase when they signed off in a series of reductions 5 years ago." Really? So why didn't this news circulate more widely instead of now blind siding millions? What gives?
Kati Haycock, president of the Education Trust - quoted in the article - says:
"Congress aggravates everybody, creates lots of anxiety out there and essentially gives us a one-year solution,"
Well, join the rest of us, Kati....who currently get 1 year solutions for Medicare doc fixes (we have to wait each year to see if congress will cut Medicare payments to doctors by 20%, and then hope we don't get ditched), and AMT (Alternative Minimum Tax) "fixes" - to see when tax time comes if we have to pay 2.5 times more taxes under a diferent schedule because congress never did an AMT patch.
This is now how congress operates: keeping citizens on tenterhooks year after year, so they can never - unless they're super rich or part of the one percent - feel financially secure. But if you think it's bad and uncertain now, wait until ol' Mitt gets elected and we have to have added uncertainty when yearly "fixes" must be voted on for Romney's post-Obama healthcare plan. Fixes including: who will make the cut for avoiding the pre-existing conditions acceptance threshold, or the cut for maximal insurance costs paid over a lifetime.