Friday, March 26, 2010

The Discussion On The Student Aid and Fiscal Responsibility Act Without The Fear Factor

One thing I have learned NOT to do over the years is listen to paranoia from the Democrats and Republicans. I have learned to read between the lines without fear mongering.

So while people were complaining about health care reform and protesting no one discussed the Student Aid and Fiscal Responsibility Act. For those who do not know what it is its a bill that was introduced in the U.S. House of Representatives by Congressman George Miller that would expand federal Pell Grants to a maximum of $5,500 in 2010 and tie increases in Pell Grant maximum values to annual increases in the Consumer Price Index plus 1%. It would also end the practice of federally subsidized private loans, using all federal student loan funding for direct loans and cutting the federal deficit by $87 billion over 10 years.

President Obama has pledged to make the US the most educated country in the world by 2020. The bill, which closely tracks a proposal by the Obama administration, would eliminate wasteful subsidies to student loan companies, and use the $87 billion in savings to make college more affordable, accessible, and effective.

SAFRA invests $40 billion to increase the maximum Pell grant award to $5,550 by 2010, and $6,900 by 2019. A recent report by US PIRG and the Institute for America’s Future estimated that this would mean an additional 260,000 students receiving Pell grants, and larger grants for existing Pell recipients.

Also in 2007, Congress slashed interest rates on subsidized Stafford loans, but these reforms are set to expire in 2012, causing the interest rates on these loans to jump from 3.4% to 6.8%. SAFRA would make the interest rate variable, but cap the rate at 6.8%, which means borrowers will be able to benefit from low interest rates while being protected from high rates.

Some of the highlights include:

(a) Investing in community colleges and Minority-Serving Institutions. SAFRA would create a competitive grant program for community colleges to create programs that would improve completion rates, improve instruction, create partnerships with employers, and implement other reforms. It will also invest in modernizing community college facilities and create a grant program for the creation of quality online college, high school, and job training classes.

This falls right under Detroit Public Schools Emergency Financial Manager Robert Bobb's plan to create PK-14 and PK-20 academies here in the City of Detroit. Not to mention community colleges are becoming more affordable and more popular because of the ever changing job market.

(b) SAFRA will invest these funds in the College Access Challenge Grant program, which funds state, local, and federal projects that help get low income students ready for college, able to navigate the admissions and financial aid process, and earn their degrees. In addition, these funds will be used to support programs at both the state and institutional level to that focus on improving college completion rates and financial literacy.

This falls right under the silver rights movement.

What people are complaining about is the student loans. Right now there are two different federal programs that award the same types of loans to students: the Federal Family Education Loan program (FFELP), and the Direct Loan Program (DLP). The FFELP has consistently been found to be more expensive to taxpayers than the DLP, since it uses subsidies and loan guarantees to persuade loan companies to act as middlemen. The FFELP is also more prone to corruption, backroom political deals, and instability during economic crisis (as we have seen recently). SAFRA would originate all future federal loans from the DLP.

In other words, The Student Aid and Fiscal Responsibility Act terminates the Federal Family Education Loan program, which provides subsidies and guarantees to private lenders that make student loans. Instead, the federal government would issue student loans directly to borrowers.

So how come Republicans were against this? Fears of government takeovers? Socialism? Communism? Get a grip. Would it help to let you know that 58% of the middle class supported this bill regardless of political affiliation while 39% opposed it? This is the 21st century..get with the program.

A college education is increasingly a prerequisite for a middle-class standard of living, current and aspiring middle-class students and their families are struggling more than ever to afford college. A massive $87 billion subsidy to private companies that make student loans did little to promote affordability. Unless you OWNED and OPERATED a BANK yourself why are you against someone who would piss on you in a heartbeat and KEEP you in debt?

And for the Black folks who went to school on student loans and grants and OPPOSE any level of reform is caught on an ideological plantation. Most of us have filed bankruptcy or worse because of student loans..yet you support high interest rates on the very loans that are supposed to help us with are academics.

And for the people who say we should not have pell grants, scholarships or anything to help us with college but support student loans are hypocritical unless they do not want other people going to college to create a permanent underclass of illiterate people in the United States. Maybe that is what some want in our society. A new plantation of illiterate people who the wealthy educated people can control. Is that what we want here? Please explain because opposing scholarships and grants but supporting student loans makes no sense to me.

In order to win support from lawmakers with powerful non-profit loan companies in their state, bill authors included a provision that would award these lenders no-bid contracts to service student loans. Each company would automatically get to service the loans of 100,000 borrowers or every borrower in their state (if the state has fewer than 100,000 borrowers), and in some states there would be more than one eligible lender.

My only main concern is not about SAFRA being passed. It was HOW it was passed. How come it had to be stuck in a health care reconciliation bill? I would have rather seen this important bill pass on its own with full debate. Give us a chance to actually debate the issues not slide it in a health bill for votes. And how come the GOP did not make any noise to this if they opposed it? Black Republicans (and Dems) who opposed SAFRA I would like to know why when our community is hit the hardest in terms of student loans repayments?

For those who are opposed to this bill I am curious to know how can one person pay their way through school if you are against grants, and other forms of financial aid? Furthermore, how come our GOP team did not see this coming? Are we in the bed so much with the banking industry (who do not care about anyone but themselves) that we cannot see right or wrong?

The State of Kentucky has received national coverage after the Kentucky Higher Education Student Loan Corporation (KHESLC), also known as the “Student Loan People,” overcharged the federal government $80 million, used the money to offer loan forgiveness to teachers, and then abandoned their promise, leaving many teachers with thousands of dollars of debt that they thought would be forgiven.

Is this right? I can hear the haters now. "They could have washed windows and saved for college." I will tell you what. You can go and wash windows and graduate in 15 years when you could have done it in 4 years.

Or how people are $50,000 in debt and can barely make the minimum payments without their loan going into default.

Or what about Dr. Susan B. Neuman, former assistant secretary of elementary and secondary education and a professor in educational studies at the University of Michigan who served in the Bush administration from 2002-2004?

Her comments:

"The legislation deserves GOP backing first and foremost because it eliminates government waste and saves billions — this is the bedrock of everything the party stands for. This bill will have the Education Department originate all new federal student loans instead of going through banks. The choice is simple —do we help Citibank make millions of dollars in profit from zero-risk student loans or find other ways to use the up to $87 billion in savings?"

She continues:

"Next, $12 billion would go to reform and strengthen community colleges. We know community colleges are the lifeblood for training workers and matching them to local employers. Ask any Republican governor and he will tell you. But, as they say on TV, there’s more! The bulk of the overall savings would help student loans keep up with inflation. Again, this helps us win in a worldwide economy."


"The key part of the bill, in my opinion, is the $10 billion for the Early Learning Challenge Fund. This fund will promote improvements in early learning standards and ensure students in the next generation have the skills that they need for kindergarten and the rest of their education."

So why is the GOP against this? I forgot education was placed on the backburner during the Health Care debates and saving the Republic was more important than making sure our children graduate from college. You cannot save the Republic if you are uneducated and you cannot save America if you are functionally illiterate.

It is imperative that we take educational reform seriously. Regardless if President Obama, Mitt Romney or Captain Crunch leads the way we must invest in our future. To fight against reforming the FAFSA forms and helping students reduce debt is insane.

Do we understand that by 4 years old, children from low-income families are already 18 months behind most other 4-year-olds? Education reform must include high-quality early learning opportunities from birth through age 5 to help give children what they will need to succeed. We know if they don’t succeed the outcomes can include dropping out of high school, lower wages, fewer life skills and trouble with the law.

We can no longer afford to ignore our shortcomings in these areas: the average student debt for graduates has reached more than $23,000, and at least 37 states are slashing higher education budgets which will lead to increasing tuition and less student aid.

Historically Black Colleges and Universities will receive $2.55 billion in investments from this bill. But these HBCUs cannot depend on the federal government alone to forge a new reality for our students. We must support out HBCUs by engaging in real leadership, real programs and expand graduate programs that will help us connect with both domestic and international markets. Our students deserve better.

The top 20 lenders have already spent $4,665,000 on lobbying since January, and they represent only a miniscule fraction of all student loan companies. They strongly opposed this legislation. That was money that could have went into investing in education.

In the silver rights movement we believe that the ultimate answer to eradicating poverty, right here in America, lies in an active, proactive and coordinated partnership, by and between the private sector, government and the community. At the same time we believe that individuals prefer "a hand up to a hand out," and actively promote programs aimed at helping people, people help themselves. A person getting financial aid is not a hand out but a hand up especially if they are going to school for engineering or the medical field.

Therefore, for those who choose to work and pay for college please continue to do so and we will support you. But do not block those who need financial aid to go to college in the name of ideologies and fear tactics. At the end of the day we need an educated America to compete in the 21st century against the global market.


Anonymous said...

Normally I do not learn article on blogs, but I would like to
say that this write-up very forced me to take a look at and do it!
Your writing taste has been surprised me. Thank you, quite
nice article.

my homepage: helpful golden labrador breeders tips

Anonymous said...

Howdy would you mind sharing which blog platform you're working with? I'm going to start my own blog soon but I'm having a hard time choosing between BlogEngine/Wordpress/B2evolution and Drupal. The reason I ask is because your layout seems different then most blogs and I'm looking
for something unique. P.S Apologies for getting off-topic but I had to ask!

Here is my site: additional reading

Anonymous said...

This website was... how do you say it? Relevant!! Finally I
have found something that helped me. Many thanks!

Feel free to visit my blog :: look at this

Anonymous said...

Great beat ! I would like to apprentice while you amend your
web site, how can i subscribe for a blog web site? The account helped me
a acceptable deal. I had been a little bit acquainted of this your broadcast offered bright clear idea

Here is my homepage: Important Site

Anonymous said...

My partner and I stumbled over here coming from a different web address and thought I might check things out.
I like what I see so i am just following you. Look forward to exploring your web page yet again.

Feel free to surf to my blog post; Recommended Site

Anonymous said...

It's very easy to find out any topic on net as compared to textbooks, as I found this post at this web page.

Here is my website :: Visit This Link

Anonymous said...

Hello There. I found your weblog using msn.
That is an extremely well written article. I will make sure to bookmark it and
come back to read more of your useful information. Thanks for
the post. I will definitely return.

my web page useful the golden retriever stuff

Anonymous said...

This website was... how do you say it? Relevant!! Finally I've found something which helped me. Thank you!

Also visit my web site :: black labrador golden retriever

Anonymous said...

certainly like your web-site however you need to test the spelling
on several of your posts. Many of them are rife with spelling issues and I to find
it very troublesome to inform the reality nevertheless I'll certainly come again again.

Feel free to visit my web-site :: get more info

Anonymous said...

Appreciation to my father who shared with me about this website, this website is in fact

My page :: check my blog

Anonymous said...

Write more, thats all I have to say. Literally, it seems as though you relied on the
video to make your point. You definitely know what youre talking about,
why waste your intelligence on just posting videos to your blog when you could be giving us something
enlightening to read?

Here is my web site: visit for trimming golden retriever tips

Anonymous said...

Terrific article! This is the type of information that are supposed to be shared across the internet.

Disgrace on the search engines for not positioning this publish higher!
Come on over and consult with my website .
Thank you =)

Feel free to visit my web blog :: quality lab golden mix information