Obama plays politics with student loans
Last month, President Obama ventured to college campuses in Colorado and North Carolina — two swing states — to tout his support for extending a student loan subsidy program.
He told college students that he sympathized with their plight. He said he was committed to doing what was necessary to keep student interest rates low. What he didn’t mention was that the well-being of college students was far behind election-year politics on his priority list.
College students have had enough talk. Neither Obama’s beautifully scripted words nor his pitch-perfect cadence have improved the plight of young adults.
Under the Obama administration, the graduating class of 2011 became the most indebted in history. Average per-student debt sits at $22,900. Just this year, aggregate student debt hit the $1 trillion mark, surpassing credit card debt and auto loan debt, according to a report by the Consumer Financial Protection Bureau.
It’s not just that students are in debt, it’s that there are no jobs in the Obama economy to help them pay off that debt. The latest figures show youth unemployment stands at 16.4 percent — the highest it has been since the Great Depression. According to an analysis of government data conducted by the Associated Press, things aren’t much better for graduates. An incredible 53.6 percent of college graduates, or roughly 1.5 million young adults, are either underemployed or unemployed.
These aren’t just statistics — this is the slow death of the American Dream. The lack of career prospects is reshaping how young Americans live their lives. They are putting off getting married, delaying having kids, moving back in with their parents and waiting to make big purchases like a house or a car.
That’s why last week House Republicans eschewed talking and got on with the business of governing by passing a bill to keep student interest rates low. To ensure that the bill was fiscally sound, they made corresponding cuts to a preventive care fund tucked into Obama’s Affordable Care Act.
It shouldn’t have been controversial. The Obamacare prevention fund has been labeled a “profligate program” by Citizens Against Government Waste. It’s also been used to lobby local and state governments to increase prices on certain “unhealthy” foods like sodas and potato chips. In case you didn’t catch the sad irony there — our tax dollars are being used to lobby for higher taxes!
The fund is so ridiculous that even President Obama and congressional Democrats have supported cutting it. Obama’s “American Jobs Act” proposal included a $3.5 billion cut to the fund, and the president went as far as to say “there should be nothing controversial about [the American Jobs Act].” Likewise, in February, 147 House Democrats supported a $5 billion cut to the Obamacare prevention fund to help pay for the so-called “doc fix.”
None of that matters to President Obama, who has threatened to veto the House student loan bill because of the cuts to the Obamacare prevention fund. Apparently, reducing the size of the fund can only be done by Democrats when they want to pay for their priorities. The economic well-being of young adults must not fit the bill.
As a result of the president’s decision to play politics with student loans, as many as 7 million student borrowers have been left in limbo, wondering if their rates will jump to 6.8 percent in July.
The situation exasperates Speaker John Boehner. “There is absolutely no fight,” Boehner said on the House floor. “People want to politicize this because it’s an election year, but my God do we have to fight about everything?”
Sadly, with Obama’s at the helm, the answer is clearly “yes.” And young adults are much worse off because of it.
Alex Schriver is the national chairman of the College Republican National Committee.