90.9 WBUR - Boston's NPR news station
Top Stories:
PLEDGE NOW
Sen. Elizabeth Warren: ‘Student Loan Debt Is Dragging Down The Whole Economy’
Sen. Elizabeth Warren, D-Mass., center, joined by other women of the Senate, prepares for a news conference on her bill, the Bank on Students Emergency Loan Refinancing Act, that would allow people with outstanding student loan debt to refinance at the lower interest rates currently offered to new borrowers, at the Capitol in Washington, Wednesday, June 4, 2014. (AP)

Sen. Elizabeth Warren, D-Mass., center, joined by other women of the Senate, prepares for a news conference on her bill, the Bank on Students Emergency Loan Refinancing Act, that would allow people with outstanding student loan debt to refinance at the lower interest rates currently offered to new borrowers, at the Capitol in Washington, Wednesday, June 4, 2014. (AP)

As President Barack Obama weighs in on college costs in a first-ever Presidential Tumblr chat Tuesday afternoon, U.S. Senator Elizabeth Warren (D-MA) is trying to push a new bill that supporters argue would change the scale and shape of student loan debt in America.

She joined us Tuesday morning to explain her bill, her choice of interest rates and why the politics of the proposal shouldn’t be in question.

“It’s a pretty simple proposal,” Sen. Warren told us. “It says that for all those people who have outstanding student loan debt — some of it’s at six percent, eight percent and even higher, depending on when you took those loans out — we propose to refinance it down to the current rates for new borrowers, that’s 3.86% for undergraduate loans…and basically do for student loan borrowers what homeowners have all done: refinance down in a current interest rate environment.”

Sen. Warren plans to pay for the loan adjustment process by putting in what she calls a “minimum tax.”

“People who are earning more than a million dollars a year in adjusted income would have to pay a minimum tax of about 30%,” Sen. Warren said.

And the rate adjustment continues to allow student loans to provide a profit source for the Federal Government, Sen. Warren said.

“Even at 3.86%, the United States government will still make a profit on student loans” Sen. Warren. “It will just be much, much smaller than the profit it makes now…I think it is obscene that the United States government is making billions of dollars off the backs of people who just tried to get an education and who weren’t fortunate to be born into families were daddy could write a check for the cost of college but had to borrow money in order to get their education.”

Plus, the Senator noted, as the economic debate on Capitol Hill continues to swirl around different proposals for a larger economic boost, changing the student loan system to benefit loan recipients could dramatically shift larger economic concerns the nation over.

“Student loan debt is dragging down the whole economy,” Sen. Warren said. “Young people can’t buy homes, can’t start small businesses, can’t buy cars, can’t take the economic steps that are not just good for themselves individually but good for the economy overall.”

What do you think of Sen. Warren’s proposal? Is it the right way to tweak the student loan problem in America? Or does more need to be done to help students both afford college and afford to pay off their loans after the fact?

Let us know in the comments below, or on Facebook, Tumblr and @OnPointRadio.

 

Please follow our community rules when engaging in comment discussion on this site.
  • frankgado

    Warren is proposing to convert contracts entered into under fixed rates now provide for flexible rates. Would the proposed alteration hold when/if the cost to the government of borrowing money (from the Chinese, no doubt) rises, consequent to the riskiness to the dollar resulting from unsustainable national debt?

    The current problem is the result of good intentions, insufficiently analyzed as to future effects under variable circumstances. Federal largesse in the area of student grants and loans has been a principal cause of accelerating the cost, and eroding the quality,m of college education.

  • Duras

    Student loans are a way of taxing working Americans. This is how republicans tax working people: interest rates on student loans. This is a backward attempt at funding the government. It promotes unequal opportunity and a nation of debtors.

    In fact, socialism is industry by government, and republicans have turned the university system into a for-profit industry for the government. If you tax the wealthy and provide a free college education, you are promoting equal opportunity and establishing the necessary public institutions Adam Smith advised in “Wealth of Nations.”

ONPOINT
TODAY
Jul 24, 2014
Youths seen playing basketball through bars on a window at the Wisconsin Department of Corrections Ethan Allen School in Wales, Wis. (AP file)

The cold hard facts about juvenile prisons. And the case for shutting them all down. Plus: former Secretary of State Hillary Rodham Clinton is with us.

Jul 24, 2014
Orchid (Galileo55/Flickr)

We’ll look at the new science of what plants feel, smell, see – and remember.

RECENT
SHOWS
Jul 23, 2014
Actor Wallace Shawn attends special screening of "Turks and Caicos" hosted by Vogue and The Cinema Society at the Crosby Street Hotel on Monday, April 7, 2014 in New York.  (AP)

From “The Princess Bride” to “My Dinner with Andre “and “A Master Builder,” actor and writer Wallace Shawn joins us.

 
Jul 23, 2014
In this Saturday, July 12, 2014, photo, migrants walk along train tracks and boxcars after getting off a train during their journey toward the US-Mexico border, in Ixtepec, southern Mexico. (AP)

Crisis at the US border. What do Latinos on this side of the border have to say? We’ll ask our special roundtable.

On Point Blog
On Point Blog
Hillary Clinton: ‘The [Russian] Reset Worked’
Thursday, Jul 24, 2014

Former Secretary of State Hillary Rodham Clinton took time out of her global book tour to talk to us about Russia, the press and the global crises shaking the administration she left two years ago.

More »
Comment
 
Where Did Nickel Creek Go?
Thursday, Jul 24, 2014

The Nickel Creek interview originally scheduled for Thursday, July 24 is rescheduled for an as-of-yet undetermined later date. We explain why.

More »
2 Comments
 
Our Week In The Web: July 11, 2014
Friday, Jul 11, 2014

As we prepare for a week of rebroadcasts, we reflect on Facebook posts, misplaced comments and the magic of @ mentions. Internet, ASSEMBLE!

More »
Comment