President Barack Obama unveiled several new initiatives Tuesday which focus on making college more affordable and helping students pay back incurred debt.
In a speech at the Georgia Institute of Technology, Obama called his efforts “a student aid bill of rights” and said a college education is critical for today’s workforce but more costly than ever.
“Higher education has never been more important, but it’s also never been more expensive,” Obama said, according to a White House transcript of the remarks. “The average undergrad who borrows money to pay for college graduates with about $28,000 in student loan debt.”
Obama tasked Secretary of Education Arne Duncan ’87 with creating a feedback and complaint system where loan borrowers can comment on federal loan lenders, collections agencies, or colleges themselves. By October 2017, per Obama’s memorandum, the Department of Education will publish a report summarizing comments and the responses provided. Obama has directed Duncan to publish a performance report on private debt collection agencies used by the department by 2016.
Obama outlined proposals to increase disclosures when people fail to make loan repayments or do not finish applications for repayment plants. The memorandum also called for Duncan to establish “as soon as practicable” a centralized place for federal loan borrowers to view their loan and payment information.
“We’re going to mobilize a coalition around this country to get this process moving, because there are a lot of good ideas right now but they’re stalled, or they’re happening piecemeal, or they’re happening in one university, or they’re happening in one state, and they have to happen everywhere,” Obama said in his speech.
Obama’s focus on higher education is not new. In his January state of the union address, he unveiled a plan to offer two years of free community college to students. During Obama’s presidency, the Department of Education has, among other things, raised the maximum amount for federal pell grant awards, shortened the Free Application for Federal Student Aid, overseen college affordability “scorecards,” and launched a $75 million program to provide funding for universities across the nation to develop programs at making college more affordable.
In response to Obama’s outlined initiatives, Faculty of Arts and Sciences spokesperson Anna Cowenhoven wrote in an email that most Harvard students graduate without debt. About 70 percent of students receive some form of aid, and the financial aid office does not expect any students to take out loans, according to the the College’s financial aid website.
Still, qualifying students may take out federal loans or fixed five percent interest rate Harvard loans up to the amount they are expected to earn from term or summer work or savings. The median amount of federal loans a family borrows to finance a Harvard undergraduate education is $11,000, and only 2.3 percent of students who take out federal loans end up defaulting on them within three years of starting the repayment process, according to the Department of Education’s online college scorecard.
—Staff writer Theodore R. Delwiche can be reached at email@example.com. Follow him on Twitter @trdelwic.
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