by Eddie London, business editor
|“The Republican Raid on Student
Aid… represents a significant step backwards when it comes
to creating college opportunities for all qualified students,” stated
Rep. George Miller (D-Calif).
“These budget cuts are taking place because of tax breaks for the wealthy,” commented
Congressman Ron Kind, who represents Wisconsin’s Third Congressional District.
A number of budget issues, including the $106 billion tax cut for the wealthiest
3 percent of U.S. citizens, Hurricane Katrina relief, and the Iraq war, are all
having an effect on Congress’ need to pull money from other programs such
as student aid.
Included in these cuts will be almost $8 billion in new charges to student borrowers.
These new charges will manifest as $5.46 billion to student and parent borrowers
when they consolidate their college loans; $1.82 billion in new taxes on student
loans for both student and parent borrowers; and, $505 million in interest on
student and parent loans as the maximum student loan interest rate of 8.25 percent
increases to 9 percent.
Rather than seizing an opportunity to make college more affordable for students,
this committee will make it more expensive,” Miller said.
If passed the new bill would cause typical student borrowers, with already $17,500
in debt, to pay as much as $5,800 more in interests costs over the life of their
The Student Aid Bill would also widen the college participation gap between wealthy
families who can afford to send their children to college and lower and middle
income families who depend on loans, scholarships, federal aid, and grants to
sent their children to college. This gap would grow if underprivileged children
were denied federal aid and loans. Miller and others belive this gap needs to
be closed for the United States to be prosperous as a whole instead of just prosperous
for the wealthy.
Closing the current college participation gap between minority and white students
could add $250 billion to the national gross domestic product and $85 billion
in tax revenue to strengthen our economy and improve the quality of life for
all Americans, according to “Pelosi 411,” an online bulletin from
the desk of Nancy Pelosi, the House Democratic Leader.
Pelosi 411 provides updates from Capitol Hill about the legislative issues that
impact the younger generation across the United States.
Education is a right not a privilege…(Student aid cuts) will be essentially
privatizing higher education,” said Jordan Burghardt, a senior at the University
of Wisconsin at Madison, in a press conference call with Rep. Miller and Rep.
Federal student aid and support programs such as Pell grants are some of the
few things which are helping lower-income and middle-income families send their
children to college. Even before the recent congressional activity, Rep. Miller
pointed out in the press conference call, an increasing number of students are
foregoing a college education for financial reasons. If Congress slashes aid
to students, more will be unable to attend college. “The price of college
is going up faster than families’ ability to pay for it,” Miller
Both Miller and Pelosi pointed out that for the United States to stay competitive
with other countries in the future, it is essential that it have a highly educated
workforce. Already countries such as China are graduating four times the number
of engineers as the United States, and even graduating more English-speaking
engineers. Europe in the past year has graduated three times as many engineers
as the United States.
With the new Federal Student Aid cuts, “long-term economic and national
security is at risk,” said Kind. More than half of the current science
and engineering workforce in the United States is
approaching retirement. By
2020, the United States is expected to experience a shortage of up to 12 million