Tuesday, October 25, 2011

President to Ease Student-Loan Burden for Low-Income Graduates - NYTimes.com

President to Ease Student Loan Burden for Low-Income Graduates

President Obama will announce new programs Wednesday to lower monthly loan payments for some students graduating next year and thereafter and to let borrowers who have a mix of direct federal loans and loans under the old Federal Family Education Loan Program consolidate them at a slightly lower interest rate.



    years, and have the rest of their federalstudent loan debt forgiven. That plan would start next year.

    At a press briefing Tuesday afternoon, Melody Barnes, director of the Domestic Policy Council, said the president would use his executive authority to expand the existing income-based repayment program with a “Pay as You Earn” option that would allow graduates to pay 10 percent of their discretionary income for 20

    Thank you, Pres. Obama. I mean that sincerely, as we need all the help we might possibly get. Our economic system is seriously out-of-sync with any notion of what's right, makes sense, or is fair.

    Notwithstanding, I would like to point out the expectations that new working professionals are expected to pay -- what I claim is the quite unreasonable burden:

    - 15% of income --> Federal income taxes (at least)
    - 10% of income --> Federal student loan repayments
    - 10% of income --> new Health Reform Act health insurance plans
    65% of income left
    - 33% of income should go to housing/home ownership.
    This leaves....? What you have left to support your families' needs on:
    = 32% of your income, after working 40-60 hours a week, for 20 years?

    Here's an example with numbers of how the average salary earner fares:

    The national average wage index for 2010 is $41,673.83 (according to SSA.GOV) :

    $41,673.83 x .32
    $13,335 LEFT $1,111/month!
    for ALL other expenses beyond barely-there bare basics, not including food or transportation!

    FOR SOME PERSPECTIVE, $674 is the basic amount of SSI (given to people unable to work and/or support themselves)

    This is what new working professionals have to look forward to for at least 20 years.
    This is the consequence of your choice to become educated.
    How is this possible in our country??

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