On Obama’s Student Loan Reform

25 Apr

President Obama said something awesome yesterday.  No, I’m not talking about his slow jamming the news on Jimmy Fallon last night, although if you haven’t seen it, click that link and watch.  Whether you like Obama or not- that is a funny video.

I am referring to the fact that President Obama, while speaking to university students yesterday, said “…check this out, all right, I’m the President of the United States—[I] only finished paying off [my] student loans about eight years ago.”

Let’s pause for a moment and do some quick math.

President Obama graduated with his J.D. in 1991 (thanks, Wikipedia).  That’s twenty-one years ago.  He says that he finished paying off his loans eight years ago.  That means our President, who spent 7 years as a State Senator and 3 as a US Senator (and I think we can all agree those are not minimum-wage type jobs), took THIRTEEN YEARS to pay off his student loans.

Thirteen years, people.  That’s a long time to be stuck owing someone money, especially when that someone is a faceless company with an army of lawyers and form letters at their disposal.

Anyway, after I heard President Obama’s speech, I wanted to know how much his student loans had totaled.  As that’s not a sum that Google easily spits out, I did some quick research and came up with some numbers of my own.

  • President Obama spent two years at Harvard Law School.  At roughly $14,500 per semester in 1990, President Obama would have paid $58,000 in tuition.  Add in standard university fees, and President Obama’s Law degree from Harvard in 1991 likely cost about the same as my Public Health degree from Emory in 2011- $60,000.
  • Before that, President Obama spent four years at Columbia University.  In the 1980s, the average yearly tuition at a four-year private school was just over $8,100 (thanks again, Wikipedia).  Since we’re talking about Columbia here, let’s bump that up to an even $9,000 per year.  That’s $36,000 over four years.
  • If President Obama only used loans to pay his tuition and fees at both schools, he would have graduated with a debt total close to $100,000.  Stretched out over 13 years and assuming an average fixed interest rate of 9% (this number comes from here) equals a monthly payment of about $1,089, or a grand total of $169,884.

You know what?  I’m starting to see why President Obama has spent so much time talking about student loan reform.  I’ve only spent two years paying on my student loans, and I talk about them and the need for reform all the time too. (The difference here is that only a few hundred people listen to me.  The similarity is that Congress doesn’t listen to me either.)

The big issue right now is the student loan interest program.  If it expires in July, the average student will pay $1,000 more on their loans in pure interest.  For those who are struggling just to make the minimum payment each month, this could put them dangerously close to defaulting on their loans.  President Obama is urging Congress to not let this program expire.  This is one of those times when even through my congressman can be an elitist … (well, it rhymes with stick), I’m still going to pick up the phone and send an email asking him to vote to extend the program.

Perhaps you could do the same? (Call your congressperson, I mean.  Don’t call mine unless you have to- he’s not a very nice person.)

If you want to know more about the issue, here are some links:

While you all read and discuss, or do whatever it is you do on the internet, I’m going to set a new goal for myself: pay off my student loans faster than the President.

Two years down, eleven to go.

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