Ron Paul is Not ‘Ending’ Student Loans

though he abolishes the Department of Education along with four other federal departments, the student loan part is taken out and handled elsewhere.

Everyone recognizes we have major problems with Social Security and Medicare, and yet when anyone attempts to address these problems, they are immediately accused of “ending,” “slashing” or “getting rid of” such programs. Ron Paul is not suggesting this for anyone currently reliant on these programs or for those who will be in the near future. In fact, Paul’s opt-out for Social Security in his budget plan is age 25—not exactly imminent doom for the program or those on it.

The same is true of student loans

But the costs must be addressed—and not simply what the government spends, but the massive debt incurred by those in this country who just want a college education. To be sure, the countless Americans who are now slaves to education-related debt can tell you there are substantial problems with our current system.

Ron Paul simply wants to fix them.

www.ronpaul2012.com...

Thought I should post this since there were many threads about student loans
I think at the very least the federal portion of student loans should be abolished, because it makes no sense.

Since there have been many talks about Ron Paul ending student loans I thought it would be a good idea to post this comment from Ron's Administration.

Thanks
MA

Thanks for the post. I was already aware of this, but, I'm glad its being brought to light. He's absolutely right. As a college graduate, I'm deeply in debt, and have not successfully found a career in my chosen profession due to the amount of competition, and lack of jobs.

On the outside it looks like a bad idea, but when you listen to his explanation of why, it makes sense. Its all a byproduct of the economy and society that is bringing the US down right now. In the long run this will help successful college graduates. Lower tuition, less competition, and more jobs will become available in the public sector. Thats the plan anyway.

Originally posted by ModernAcademia
though he abolishes the Department of Education along with four other federal departments, the student loan part is taken out and handled elsewhere.

Where is it "handed?" How is Ron Paul going to do this? This sounds like pure rhetoric to me, but I see no evidence of an actual plan in regards to student loans. Please correct me if I am ignorant.

I am a former college student, 40k in debt (half of that because i couldn't find a job in town so had to live off it, and living expenses from the actual loans themselves). Finding a job here in the city without a college or uni education is hard, i remember applying everywhere for months and months. Finally got a security job that almost made me lose my mind (i suggest not doing security)

I personally think that college costs should be downsized significantly, while more of the cost goes towards actually improving the educational institutions. I have no complaints, i have a decent job (31k a year to start, not really that bad.. not really that good), but im alive..

I'de probably be a little worse off if i didnt apply for RAP (repayment assistance plan), in which i only pay a fraction of the actual costs of my loans. But once my student line of credit turns into a loan, ill be forking out almost 200 a month for that. Which hits me right where it hurts. Guess i'll be paying it for the next 10 years.. I actually just want to go back to school tbh, i love learning. If school were free, i'de be going for far more than 'my dream job', i'de be going to learn everything i can. Because there is so much to learn, and i dont have the money to learn it =P

I'de be enrolling for Astrophysics
And probably Computer science.
After i get upgrade courses to bring my math back to where it once was (i used to own math, but lost it when i left highschool)

Thanks for posting this obvious information OP. I cant believe the ignorance of people who think Ron Paul is just dropping student loans.

Ive known this information since the inception. Thanks for taking the time to create a thread. I just love reading the knee jerk reactions from people. The utter panic from their fantasy created by what someone told them to believe.....

People please take 10 seconds and look this up...Ron Paul is the ONLY one to sit a budget on front of anyone that is real....(if that alone isn't good enough for you, well then your really not worth the information)

We have got to get this out to people no matter how stupid you need to be to believe this lie. A lie created by ignorant fools could actually hurt Ron Paul....I could'nt stand the thought of Ron Paul not getting a chance because of a ton of idiots running around spreading lies about the only candidate with a soul.

Quick before this gets to the second page I must teach everyone about the 90/10 rule!

This is the REAL reason a college education is so expensive today!

Here is an article that explains it: The Hidden Factor Driving up the Cost of a College Education

The 90/10 rule is a regulation that limits nontraditional schools from receiving more than 90% of their funding from Title IV funds (Pell grants and Stafford loans). These nontraditional schools are more commonly known as career colleges or trade schools and operate on a for-profit basis.

All well-intentioned so far, lets see what happens.

So how does the 90/10 rule drive up the cost of a college education? The effect is achieved in 2 ways. First, there's the percentage of students that attend a school who receive Title IV aid. If most of the students who attend a school are financially able to pay their own way without receiving federal aid, the 90/10 rule doesn't come into play. When an increasing percentage of students start receiving federal aid, problems result. I'll explain in a moment. The second component that comes into play is when Congress increases the amount of Pell grant money or Stafford loan money that a student is eligible to receive. If a student can get more money then that edges the total funding closer and closer to 90% federal coverage.

So... there comes a problem when government funding gets too close to 90%. Lets see what happens.

Here's what happens. In either scenario, the school begins taking in a greater portion of its total funds as federal aid dollars. It doesn't matter whether that money is coming as a result of more students attending who choose to apply for federal money or whether the increase is coming from a higher funding eligibility as a result of congressional legislation. More federal dollars are coming in. If that amount gets uncomfortably close to 90% of the total funding the school has to do something to decrease that percentage. A school is not going to turn students away in order to address a 90/10 problem, so the alternative is to raise the tuition. By raising the tuition the federal money that students receive doesn't go quite as far. In order to attend the school the students will have to come up with more money out of pocket to cover the cost of their education. They typically come up with this money by taking out private loans or using personal credit cards.

So when the government funding gets too close to 90% the "college board" has a meeting and decides to raise the tuition costs to avoid problems with the law, got it.

As a result college tuition gets harder to pay, gotcha.

In response to the increase in tuition by the schools, Congress reacts by increasing the student eligibility for Pell grants and Stafford loans. In response to the increased grant and loan money coming in, these schools increase their tuition in order to stay within the 90/10 regulations. It becomes a vicious cycle with the net result being that tuition continues to increase because it has to.

So when the tuition cost goes up... so do the government backed loans, got it. And of course the colleges have to raise the tuition in response in order to avoid problems with the law. Just rinse and repeat as they say.

How does this affect traditional 4-year and 2-year colleges? As the career colleges and trade schools increase their tuitions and are able to pay their instructors better it drives up the salary expectations of the traditional schools. A rising tide lifts all ships and rising tuition spreads across the board.

Wow, look at the market forces at work there.

Something this screwed up could only have been spawned by government.

You know why a Univ education can get really expensive?

For me the biggest surprise was the cost of textbooks.

I was paying like 125-150$ on one book in a class I needed 2-3 things in. 300+$ on a single semester of a single course.

Oh and I took an elective credit in music theory, and we were required to purchase a 20 disk set compilation of music throughout history, it was like 150+ $ as well.

This isn't even tuition costs. It was actually sort of rare to get a course where we were allowed to purchase older used texts or materials, because there are always "new editions" released so often.

I honestly think that someone is getting major kickbacks in this system and ripping us all off. $$$