Monday, January 18, 2016

Scott Walker's "College Affordability" plan is a taxpayer Giveaway to Big Banks, while Minnesota pours saved interest back into state economy!!!

Scott Walker's playing his voter base for saps again, and they'll never know what hit them.

Playing up to big money special interests, Walker's "college affordability" initiative makes taxpayers foot the bill, so banks can continue to rake in high interest profits on sky high student loans.

Wisconsinites are now supposed to swoon over saving a possible $165 on student loan interest? If you like that, Walker's got a one dollar savings on your property tax bill he'd like to give you...oh, that's right, he's already tried that insulting voter bribe.

In a transparent sop to their campaign contributors, Republicans want to pluck another $5.2 million in state revenues, which Rep. John Macco (R) describes as "a little bit of extra money," for the purpose of saving banks a cut in their interest rates.

Democrats warned us that something like this would happen, but again no one listened. In fact, Politifact helped Walker, by playing dumb in the 2014 election claiming Walker never came right out an said he opposed a big government state refinancing program:
The group acknowledged it has no evidence that Walker opposed a 2013 Democratic proposal to create a state student loan refinancing authority. Walker may not support the idea, but he hasn’t fought it, either -- as the group claimed.  We rate the statement False.
Of course Walker's incredibly short sighted tuition freeze gimmick can't last forever either, but he'll never tell you that:
As reported by US News:“[This is] why such tuition freeze promises don’t last long – they generally don’t work… Opponents say tuition freezes are fine for a short-term fix, but shouldn’t be extended for long periods and don’t really solve the problem with the high cost of college.”
Minnesota's common sense plan even convinced many Republicans to create a state refinancing program. They reasoned that putting saved interest back into their states economy was just smart government:
Nearly 500,000 Minnesotans carrying large amounts of student loan debt could be eligible for a new state-run refinancing program, "SELF Refi," intended to cut interest rates and potentially save a borrower tens of thousands of dollars. The state is fifth in the nation (WI is 3rd) when it comes to the debt students accumulate over their college years, and the average student graduates with about $30,000 in debt. 
"It makes it just so much more difficult for them to do so much more in our economy, whether it is buy a house or start a small business or buy a car." Lt. Governor Tina Smith said. "If we want to have an economy that works for everyone in Minnesota, we cannot allow these high debt loads to put a crunch on our competitiveness."
On the flip side, Walker wants to get government out of the way. Look at the potential student savings in Minnesota, cash Walker is willing to give up:
Under the plan, a student who took out a $40,000 loan at 8 percent could reduce monthly payments by $200 to $300 and total interest costs by $25,000. In another example, a student who carries $70,000 in debt at 9 percent could save $52,000 refinancing.
Fox11 interviewed Walker:

States with refinancing of student loan programs like Minnesota's will no doubt cut into the obscene profits banks were making on interest, but that doesn't mean the banks will stop contributing massive amounts of money to Republican lawmakers everywhere to block or kill these programs eventually. 

Funny thing, a banks political spending to maintain higher interest rates for struggling students - Good; Union political spending supporting struggling students - Bad: Go figure:


lufthase said...

It's great MN and other states are taking action on student debt re-financing, but the real story is state divestment from the UW System...

2001-02 Avg Cost of Instruction = $7,943 (from 2003 LFB Report, pg. 21)
Inflation-adjusted to 2013$ = $10,448
2001-02 Avg Tuition = $2,976 = 37.5% of cost

2013-14 Avg Cost of Instruction = $10,349 (from 2015 LFB Report, pg. 14)
2013-14 Avg Tuition = $7,317 = 70.7% of cost

The actual cost of providing a UW education has been unchanged for the last 15 yrs. What has changed is how the cost has shifted away from the state and onto students. If state aid to the UW had kept pace with inflation and enrollment, there'd be an extra $500 to $700 Million/yr, which would take a big bite out of tuition and debt.

Democurmudgeon said...

Thanks, nice relevant angle that really gets to the point.

Shell game basically, but the burden falls on families with college students, and not the state as a whole. Republicans don't get the "society benefits" concept, don't care...or both. Freeloaders all the way.