During the holidays, Democrats waited in the wings, salivating at the chance to finally be in charge.
Once the first day of the season came, House Speaker Nancy Pelosi, D-Calif., and company wasted no time going through a rapid- fire legislation session that enacted a variety of projects, including legislation to cut college loan rates in half. Many celebrated in support of the government and considered it a long-awaited victory.
However the law is far from victory; it is appeasement. The legislation makes college loan interest rates decrease in phases of 0.68 percent every year, starting with loans taken in 2006 and ending in 2010.
This means that this year’s freshman class’ cheapest loan its senior year will be fixed at an interest rate of 4.08 percent.It turns out that rhetoric of “cutting interest rates in half” is true, just not for current students. For most of us, it’s more like one or two percentage points. Excuse us while we all jump up and down.
While college students should take these victories as they come, this legislature does not provide a saving grace to current students, and is little to help college students as a whole. It seems that the new Congress just wishes to give a slight nod to the younger demographic without really answering the plea for lower college costs. In fact, there is much more that could be done to help college students.
Many believe that a real victory would be to re-energize the stagnant standard Pell Grant. A Pell Grant is an award given by the federal government on a most-needed basis. Since 2003-2004 the grant has been stuck at $4,050. Given the rate, the average college tuition at a public university has increased 35 percent in the last five years.
With every passing year, those who receive Pell grants are losing money, both to inflation and the skyrocketing tuition costs. What’s more is that one of the President’s issues on the 2004 campaign was to increase Pell grants, but the amount hasn’t increased while the number of students eligible to receive the grant has decreased.
Normally, some conservatives are apprehensive of any sort of government aid, but college sits in its own world. With nearly every other good in existence there is a point where people simply will not or cannot pay any more. How many people would reconsider their eating habits if McDonald’s started selling cheeseburgers
for five bucks a pop?
College, however, is a different beast. The great thing about America is our limitless ambition. That same ambition is what makes our thirst for a college degree nearly limitless. Every year we get that letter in the mail detailing how and why Temple has raised tuition. I’d bet that most students simply take more loans and keep on trucking. It’s also the same problem
with healthcare – limitless demand.
But if Pell Grants were to increase as fast as college tuition, we would have another problem: the taxable income of the average household will not keep pace. It doesn’t take a rocket scientist to figure out that Pell Grants cannot forever keep pace with college tuition.
Then maybe we do not need to fix Pell grants; we need to fix tuition.But instead of assuring that aid keeps pace with tuition, reforming higher education, or assuring that colleges are subject to the same market pressures everything else is, Congress cuts our loans by 0.68 percent. There was an attempt to make the current legislation reflect the Pell Grant issue, but it did not succeed.
Perhaps through an act of Congress, or an act of the market, college becomes more affordable.
Otherwise I might have some explaining to do to Sean Jr.
Sean Blanda can be reached at