Senator Blumenthal Jumps into Student Debt Fray

Typically whenever we discuss as a famous Senator making noise about student loans it is Senator Customer advocates of Massachusetts.? Yesterday we been told by somebody new.

Senator Richard Blumenthal of Connecticut announced a plan to grow the general public Service Education loan Forgiveness Program.? Currently, people employed in public interest jobs, such as non-profits and for the government, might have their student loan balances forgiven if they make making payments in time on an eligible arrange for ten years.? Senator Blumenthal’s plan requires servings of the loans to be forgiven along the way… rather than everything at the conclusion.

Under his proposal:

  • 15% of your student loans could be forgiven after two years of public service
  • An additional 15% could be forgiven after 4 years of public service
  • An additional 20% would be forgiven after six many years of public service
  • An additional 20% would be forgiven after eight many years of public service
  • The remaining 30% would be forgiven after 10 years of public service

In short, the plan is a perk for individuals to go in public service, even when they aren’t willing to invest in the ten years required under the current system.

What’s Good?

Perhaps the best part relating to this bill is the fact that a Senator is referring to expanding the general public service program instituted by President George W. Bush.? The Federal government has sent signals out that it could look to lessen the program (we shared our thoughts using the President about this plan).

As usual, it is also nice to see any pursuit on student education loans at the federal level.? Student education loans seem to be have less the priority list for those in power, so it’s always beneficial news when some ideas they fit out for public debate.

What’s Bad?

This proposed legislation seems more aspirational than anything.? As nice as the program would be, there is no analysis how much it might cost, neither is there any proposed funding mechanism.? This bill appears like it’s dead on arrival.

Another trouble with the bill is that it addresses the one area of current student loan law that’s already very good.? Handling problems like bankruptcy, private loans, and for-profit scams ought to be a place of emphasis.

Bottom Line

This looks like a non-event.? The proposal is one thing that would be nice, but is more likely to be something long forgotten in a few months.