Bills, bills, bills leads to loans, loans, loans
By: Danielle Jones
Issue date: 2/22/10 Section: News
Universities across the nation are feeling severe pressure from the financial crisis, causing them to make budget cuts across the board. This has also left students across the country sinking under the pressure to pay back money taken from student loans. Universities have taken drastic measure such as: freezing hiring, cutting athletic teams, and getting rid of free laundry services.
According to Time magazine, U.S. colleges and universities suffered, on average, a 23 percent endowment drop in the second half of the year. Universities are also seeing an increase in the request for student aid.
Students like Adam Broomfield, 28, who attends Eastern New Mexico University, are seeing the effects of the financial crisis in regards to the money they have taken out to go to school.
"I couldn't afford to pay my bills, because I was a nontraditional student," said Broomfield. "In order to take the amount of hours that I needed to graduate I needed to take out money so that I could spend more time in school and less time working."
According to the Project on Student Debt, an initiative of the Institute for College Access and Success, the average student debt is about $23,000. Broomfield claims that he will most likely owe around $15,000 when he is done with school.
In President Barack Obama's State of the Union Address, given on Jan. 27, he addressed the subject of student loans. According to the White House's Website issuing the State of the Union Speech, the President stated, "this bill will finally end the unwarranted taxpayer subsidies that go to banks for student loans. Instead, let's take that money and give families a $10,000 tax credit for four years of college and increase Pell Grants." He also guarantees that if a person chooses a career in Public Service their debt will be forgiven after 10 years.
A recent report in the New York Times, reveals that these modifications might be farther off than anticipated. According to the report, plans made by the White House have been questioned by an aggressive lobbying campaign that is lead by the nation's biggest student loan lenders, Sallie Mae.
The lobbying campaign does not want the government to have complete control over the loan process. This would put many people out of work, at a time when unemployment is already high. The lending companies also recommend that the counseling process be taken out of the loan process if the government took over, which could have negative results.
In this time of economic change felt around the globe, all universities and students can do is make the budget cuts necessary, and hope that everything will get better soon.
According to Time magazine, U.S. colleges and universities suffered, on average, a 23 percent endowment drop in the second half of the year. Universities are also seeing an increase in the request for student aid.
Students like Adam Broomfield, 28, who attends Eastern New Mexico University, are seeing the effects of the financial crisis in regards to the money they have taken out to go to school.
"I couldn't afford to pay my bills, because I was a nontraditional student," said Broomfield. "In order to take the amount of hours that I needed to graduate I needed to take out money so that I could spend more time in school and less time working."
According to the Project on Student Debt, an initiative of the Institute for College Access and Success, the average student debt is about $23,000. Broomfield claims that he will most likely owe around $15,000 when he is done with school.
In President Barack Obama's State of the Union Address, given on Jan. 27, he addressed the subject of student loans. According to the White House's Website issuing the State of the Union Speech, the President stated, "this bill will finally end the unwarranted taxpayer subsidies that go to banks for student loans. Instead, let's take that money and give families a $10,000 tax credit for four years of college and increase Pell Grants." He also guarantees that if a person chooses a career in Public Service their debt will be forgiven after 10 years.
A recent report in the New York Times, reveals that these modifications might be farther off than anticipated. According to the report, plans made by the White House have been questioned by an aggressive lobbying campaign that is lead by the nation's biggest student loan lenders, Sallie Mae.
The lobbying campaign does not want the government to have complete control over the loan process. This would put many people out of work, at a time when unemployment is already high. The lending companies also recommend that the counseling process be taken out of the loan process if the government took over, which could have negative results.
In this time of economic change felt around the globe, all universities and students can do is make the budget cuts necessary, and hope that everything will get better soon.