To: President Donald Trump, The United States House of Representatives, and The United States Senate
Support the 6-Pack of Government Expenditure-FREE Student Loan Debt Reform Measures
Congress should enact the following measures to reduce student loan debt.
The 6-Pack of Government Expenditure-FREE Student Loan Debt Reform Measures:
1. Allow all federal student loan borrowers to reconsolidate their student loans to a 2% interest rate.
2. Modify the Income Based and Income Contingent Repayment Programs to calculate discretionary income as follows:
Discretionary Income = Adjusted Gross Income - Taxes - Necessities (where necessities include expenses for food, rent or mortgage, utilities, healthcare, transportation, and other basic needs).
3. Allow one-time, non-taxable, penalty-free withdrawals from retirement accounts for repayment of federal and private student loans.
4. Make student loan interest payments fully tax deductible.
5. Afford at least partial credit for Public Service Loan Forgiveness for long-time public service employees.
6. Restore bankruptcy protection for private student loans.
Why is this important?
Approaching $1 trillion, student loan debt has eclipsed credit card debt in America. Economic observers are finally paying attention, citing student loans as a looming bubble that could present another obstacle as the U.S. tries to recapture its economic footing. Yet, there are simple and cost effective ways to fix America’s broken student loan system. Studentloandebtreform.org has developed the six proposals above to reduce student loan debt (see http://www.studentloandebtreform.org for details).
The problem is simple: too much money is loaned at too high interest rates to students who have to pay too high tuitions. Student loan debt represents a crisis that our government so far has been unwilling to address. By neglecting to deal with the student loan debt issue, our country and its leaders are effectively ensuring that millions of Americans will live out a good measure of their lives under crushing student loan debt. This debt does and will continue to prevent borrowers from achieving the financial position necessary to start a family, buy a house, or otherwise contribute in a meaningful way to the economy. Government officials have not shown that they fully understand or appreciate the very real drag that student loan debt has on the overall economy.
Student loan borrowers do not have a lobby. We do not have the money to fund congressional campaigns. There is no super PAC to fight for us. This fight is ours and ours alone. It is more critical than ever that we make our voices heard, especially to members of Congress. We need action now.
The proposals above do NOT call for any government expenditures. Nor do they call for a massive program of student loan debt forgiveness. Rather, they strive to create a student loan repayment system that is fair to borrowers and taxpayers and that would provide an immediate stimulus for the American economy.