TaxProf Blog

Editor: Paul L. Caron, Dean
Pepperdine University School of Law

Friday, October 28, 2011

NY Times Debate: Should College Grads Get a Break on Their Student Loans?

Room for Debate Following up on this morning's post, Obama's Education Loan Reforms of Limited Help to Law Students: New York Times, Room for Debate: Should College Grads Get a Break on Their Loans?:

The Obama administration unveiled a plan this week aimed at reducing the burden of student loan debt, which now surpasses credit card debt in the United States.

The plan will let borrowers consolidate their government loans and government-backed private loans into one monthly payment, at a lower interest rate. It will also give people the right to cap their loan payments at 10% of their income, down from a current limit of 15%, and will allow student debt to be forgiven after 20 years, compared with 25 years under the law now.

Will the Obama plan make a difference? Will it help prevent defaults or will it lead today's students to borrow more, if they view their debts as potentially negotiable and if they believe the government is assuming more of the risk? What should government do about student debt and the college loan industry?

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Only Goldman Sachs and their buddies should receive huge amounts of low interest money from the Fed, because they create jobs and keep the economy running smoothly.

just kidding.......

Trick or treat?

Posted by: save_the_rustbelt | Oct 28, 2011 4:08:30 PM