Young Americans are leaving college under crushing student loan debt, but politics is once again obstructing any chance at reform.
The Do-Nothing Congress did just that again this week when the Senate failed to advance Sen. Elizabeth Warren's student loan refinancing bill. After politicians gave their usual lip service and little else to student loan debt, Warren's bill was one of the only plans to materialize.
President Obama has his own two-pronged plan that involved supporting Warren's bill and expanding an income-dependent repayment cap to lower monthly student loan payments.
"In a 21st century economy, a higher education is the single best investment that you can make in yourselves and in your future," Obama said. "We've got to make sure that that investment pays off."
Under Obama's Pay As You Earn plan, low-income borrowers could make smaller payments for 20 years. Any balance remaining would then be forgiven. While only 200,000 participate in the plan now, Obama's moves would increase it to 5 million.
The good news is Obama can accomplish this through executive order. The bad news is anything requiring Congressional approval is usually DOA.
Republicans filibuster student loan reform. If only students were billionaires then Congress would listen. pic.twitter.com/86wMobPDQ1— Pat Bagley (@Patbagley) June 11, 2014
Republicans stand in opposition to Warren's bill and they do have one point: The plan does nothing to address college's skyrocketing cost. It would only make those exorbitant loans hurt a bit less each month. (Of course, the real opposition to Warren's bill came from a plan to close tax loopholes for millionaires to pay for it.)
Universities certainly aren't blameless. Students have proven they're willing to pay (or borrow) increasing tuition fees, and universities have little incentive to cut costs as more students compete for college acceptances.
This is hardly a trivial issue, either for college graduates or the U.S. economy. Student loan debt ticked past $1.2 trillion and the average student graduates with $26,600 of debt. Considering the average tuition bill is $30,094 at private universities, it's reasonable to conclude many students graduate with much higher debt.
Student loan debt now exceeds credit card debt and dragging down the economy as borrowers avoid mortgages and other spending that boosts the country's financial health.
As students spend the summer preparing to head back to college, how many of them truly realize what an enormous financial burden they'll suffer for their education?