Feel free to check out one of many articles on the new roll back the ‘Pro Middle Class’ ‘Pro Working Class’ ‘Pro American’ Trump Administration pushed forward today. http://www.nbcnews.com/news/us-news/betsy-devos-rolls-back-obama-era-student-loan-guidance-n745701
Betsy Devos, a Billionaire, one of the “Experts” President Trump chose to lead his team has struck a victory for big business today. I’m told this only looks like a break for the elite and in reality, like most of the agendas being pushed by Trump’s administration, will eventually trickle down to help us.
We just have to “Give him a fair chance” . I’m patiently waiting…
However in a move that shouldn’t surprise anyone, she sided with student loan providers rolling back many of the protections given by President Obama that shield borrowers from predatory practices, unfair collection tactics, and unreasonable repayment plans.
Clearly this move was in the best interest of the middle class working family who also just happens to be the main population who are in student loan debt, but I’ll elaborate more.
If you aren’t familiar with the decision, please allow me to briefly to summarize: Her cut backs take away funds from Federal programs that focused on accommodating borrows, which helped them find ways to pay back their student loans, and shifts it towards improving how Federal agencies ‘collect’ the disbursed funds.
Seems to make sense from a business perspective, however she is not running a business. There are social consequences which I will elaborate on from my time as a borrower in the bountiful times before President Obama.
I remember when I first left college in the mid 2000’s and began receiving those calls every morning around 8:05 am. Like clockwork someone on the phone would remind me of my student loan debt, which at the time was a manageable 40k after 2 1/2 unsuccessful years at a private college in Westchester, New York.
“Why a private college?” You ask, “Weren’t there many affordable state or community schools you could have enrolled at??”
At the time I enrolled at a private university because A) it was one of the few (maybe 2-3 universities) that accepted me and B) the only one that offered me a scholarship.
When faced with this as an option over a community college the choice was easy being conditioned to need a four year degree if I were to have any success in the real world.
Having left the university in my ‘trying to figure things out phase’ I did not have the means to pay back the $327/month I was required to…which is when the calls started.
They started with me, then my family, and even a few of my friends.
See they wanted their money so it would make sense to do a scorch the earth tactic to ensure that if I did not pay them what I owed, I’d suffer the consequences of being a burden to those who were unfortunate enough to have been in contact with me.
These are the types of protections Betsy Devos is removing by the way.
I’m also unsure how they got numbers of my associates…but that’s another story.
Eventually I reenlisted in college, mainly to suspend my loan payments, continued on through a masters program and accumulated another 160k in debt leaving the total at 200k.
I left my graduate program optimistic that I’d have the means to pay some of this back and was fortunate to have graduated in a time when the Income-Based Repayment program had started.
Income Based Repayment was not around when I first left college and was a saving grace for someone who’s first post grad position paid a handsome 30k annually.
The pre-income based repayment would have been somewhere in the $1,600/month category, but fortunately I was not bogged down with that amount and instead paid $75/month which was determined by my income.
While Betsy’s decision has no impact on this program (yet), I find it hard pressed to think that opportunities like the one I’m describing would be exempt from the chopping block down the road.
Getting chopped up would have dire consequences on the economy. Sure to someone like her, who doesn’t have to worry about loans impacting her quality of life, she and her friends are relatively unaffected.
Her previous positions as a business woman were about dollars and cents and from an executive standpoint one way you make up costs is to focus on collecting what is owed. Business owners rarely have to deal with the socioeconomic impacts of their decisions, it is a black and white bottom-line proposition.
However people like myself and other student loan borrows there are consequences to astronomically high student loan debts.
For instance having the ability to eat, pay rent, and afford to get to work is kind of a big deal…which is the social part I mentioned, that would be hard for someone to understand who hasn’t experienced it.
Now because I could afford those things, these luxuries, I was given the freedom of opportunity which I eventually managed to turn into enough experience to get a better paying job.
42k a year, which was a year later. Still not exactly the financial stability I thought I’d have, nor would it have been enough to pay for the amount I initially would have had to pay, but it was a jump up the pay scale.
After two years of that I was lifted to the Middle Class when I was offered a 52k/year job.
The income based program allowed flexibility in my life. The ability to relocated or travel to job opportunities I otherwise would not have been able to if I was handcuffed to the $1,600/month payment in the pre-Obama times.
Now I get what some of what you might be thinking “You shouldn’t have taken out so much, it’s your loan, you should pay for it!” .
To which I agree, and also am with a sense of gratitude that I am able to do so.
However, provisions like this, which are in jeopardy at the moment, allowed me the opportunity to grow financially as I took on better paying jobs.
Better paying jobs means I pay more taxes.
Better paying jobs means I don’t qualify for social programs like SNAP and Medicaid
And a better paying job meant I am not a burden on society as I would have been if I wasn’t free to relocate and grow into other opportunities.
There is a reason why I’m concerned when policy shifts in favor of big business to move the burden on Americans like myself who have maximized their opportunities to contribute as a result of benefits given by the Obama Administration.
Business mindsets do not work in government and I’m happy to discuss this idea with anyone willing to engage me. Maximizing bottom lines don’t lead to prosperity, programs that empower the people do. We are in big trouble if this trend continues with our administration.