DEMOCRATS RELEASE REPORT ON "THE COLLEGE COST CRUNCH"

On eve of one of the largest interest rate hikes on outstanding student loans, report provides state-by-state analysis of rising college costs and student debt

June 28, 2006

FOR IMMEDIATE RELEASE

 Full Report

Washington, DC—On the eve of one of the largest interest rate hikes on outstanding student loans, Democrats urged students to consolidate and unveiled a report on the state of student debt and the increasing cost of attending college in the United States.

The report provides a state-by-state analysis of the rising cost of college, the erosion of the Pell grant, the average student loan debt incurred by college graduates and the percent of family income needed to pay for college after financial aid. The Democrats also discussed their initiatives to combat the student debt crisis and increase support for students, not banks.

Senator Kennedy said, "Families across the country are pinching pennies so they can afford to send their children to college. They are willing to sacrifice a lot for a college education, but this report shows that it is getting harder and harder as costs go up, and student debt goes up too. The federal government needs to do more to help families. The American Dream is at risk if we fail to make college more affordable. Graduates should not have to choose between paying off their college loans and buying a home or having a family."

“If we want to move ahead in a global economy, we are not going to do it by importing talent from overseas,” Senator Durbin said, “We have home-grown talent in America. This is a land of opportunity so long as we create the opportunity in schools across America, including our colleges and universities. The policies on student loans pushed by the Bush-Cheney administration go in the wrong direction. An investment in our kids' education is an investment in our future.”

“Student debt is like quicksand – it swallows you up before you have a chance to gain your footing,” Schumer said. “Graduating from college should kick start a young person’s professional life, but massive debt will just bog you down for decades. Graduates are not only leaving college with a diploma this year, they’re also leaving campus with mountains of debt. The bottom line is, at a time when a college education is becoming more and more expensive, we need to do everything we can to ensure that our nation’s young people all have access to high quality, affordable education.”

Senator Clinton said, "At a time when incomes are stagnating, when people are losing benefits like health care and pensions, when gas prices are rising, and when the minimum wage hasn't increased in almost a decade, American families can ill-afford to pay higher rates for college loans. Instead of increasing the burden on families, we should be doing everything we can to make college more affordable so we can open the doors of higher education to more students."


The report also lays out how each state would benefit from the implementation of Democratic proposals by showing the amount of savings generated if loan interest rates were cut in half, the increase in the average Pell Grant award and number of eligible students if the Pell were increased to $5,100, the reduction in monthly loan payments for starting teachers if repayment was capped at 15% of income, and the number of students and families who would benefit by the re-institution of the college tuition tax deduction.

Senate Democrats spoke with reporters today about the urgent need to focus on the findings of the report, and to implement proposals to address the debt crisis and ensure cost is not a barrier to getting a college degree. Senators pointed to the near-two percentage point student loan interest rate hike scheduled for Saturday as yet another reminder that the time to act is now, and reminded students that they have only a few days left in which to lock in today's lower rates through consolidation.

Press Contact

Laura Capps/Melissa Wagoner (202) 224-2633

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