Obama signs the Education Reconciliation Act March 30, 2010. Photo c/o CBS
There are some big things happening in Washington, D.C. that could benefit college students in the long run. As part of President Obama’s health care bill, there are several provisions that will make higher education more accessible and affordable for students.
“By cutting out the middleman, we’ll save American taxpayers $68 billion in the coming years,” said President Obama today at a Alexandria, Virginia community college campus. “That’s real money, real savings that we’ll reinvest to help improve the quality of higher education and make it more affordable.” With these new changes, student loans will now be accessible directly to students, ending the government subsidies to banks, and effectively freeing up $68 billion dollars. In other words, the government will become the originator of the loan, instead of private banks.
From these savings, billions of dollars will be funneled into Pell Grants to assist low-income college students in funding their education. Currently 8.5 million students are benefiting from Pell Grants, which do not need to be repaid. When the bill comes into effect in 2014, student loan borrowers will only need to pay back 10% of their income, rather than the 15% in effect today.
“For a long time, our student loan system has worked for banks and financial institutions,” Obama told college students at the Alexandria, VA campus. “Today, we’re finally making our student loan system work for students and all of our families.”
We’re curious what college students have to say about this new bill. Will these changes have a positive impact on America’s future?