Kerry Seeks End to 'Windfall' on Loans

Yahoo! News ^ | 4/14/04 | Mike Glover - AP

[NormsRevenge]

NEW YORK -

Democratic presidential candidate John Kerry (news - web sites) said Wednesday he would pay for his plan to give a free college education to young students who agree to public service by ending a $13 billion "windfall" that banks earn for making government-backed student loans.

Kerry contended that as many as 500,000 young men and women would be lured into public service by his plan, which he said would reinvigorate the nation's commitment to such service. He announced his plan at a roundtable in New York City, saying he was stepping forward with proposals to finance his effort.

Joining Kerry in Harlem at City College of New York were Sen. Hillary Rodham Clinton (news - web sites) and Rep. Charles Rangel, both New York Democrats.

"We are going to bring about the largest increase in domestic national service in our history," Kerry said.

"If you're willing to do right by America, then America is willing to do right by you," he said. "If you will serve your country, we will pay for your college education."

Steve Schmidt, a spokesman for President Bush (news - web sites)'s campaign, said the plan is badly flawed. "It leaves students more than $5,000 short of the full cost of attending college," Schmidt said.

Kerry is spending the week focusing on the spiraling cost of a college education. One linchpin of his package is a proposal to offer a free college education to young students who agree to a period of public service.

He conceded the proposal is expensive — with a $13 billion pricetag — but said it can be financed by restructuring the federally guaranteed student loan programs. Congress sets the terms of student loans.

"Every penny paid for, with money to spare," Kerry's campaign said of his plan.

The federal government guarantees student loans at an interest rate of 3.4 percent. If bank collections fall below that level, the federal government will make up the difference.

With real interest rates higher than that level — and collection levels relatively high — banks are essentially guaranteed a profit under the program, Kerry said.

"This is a windfall that creates excess profits for the banks," he said.

Kerry said he would force banks to bid in an auction for the business of offering student loans, substituting the marketplace for congressional action in setting terms of student loans.

Kerry's campaign estimated that 220,000 young people have been priced out of a college education over the last three years. Offering the prospect of a free college education would lure those people back to higher education, he said.

Campaign officials said projections showed that 200,000 young people would agree to serve a two-year public service commitment, which would pay for the full cost of a four-year college education. Another 300,000 would perform part-time service to get assistance with tuition costs, the campaign said.

[NormsRevenge]

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On the Net:

http://www.johnkerry.com

[Semper Paratus]

Ketchup economics.

[PeterPrinciple]

200,000 young people would agree to serve a two-year public service commitment,

And what would these "bright young minds" be doing????

[camle]

"vote for me and I'll make the largest program of indentured servitude ever seen. Heck, I'll make it permanent if I can."

what a maroon!

[NativeNewYorker]

John Kerry wants to tax your bank account to pay young people to work in the government.

What a winner!

[TnMomofTwo]

What would they be doing AND how would they pay their rent? Let's see, in Kerry's world profit (i.e. banks) is BAD BAD BAD while college graduates selling off 2 years of their lives for "free education" (slavery?) is GOOD. Hmm...wonder which liberal institutions of "higher learning" these students would be required to attend in order to qualify for this new entitlement.....

[JeeperFreeper]

Join the military and get help with college( a program already in existence) Now that's an idea that fails to connect with liberal youth. It's too blase and risky. Might be dangerous and require discipline and hard work, too. On the other hand, go hobnob with the the hoipolloi, feel smug in superiority, drink beer, smoke dope in "community service" near home in return for college help. Now that's an idea the Kerry Kids can endorse. And, like daddy's credit card bil, who cares how it's paid for?

[BlueNgold]

So if offering student loans is no longer profitable for the institutions, who then will be offering student loans? So we will benefit a few who are willing to join the ranks of the professional socialists to buy their education, and we will punish those willing to work hard and carry their own weight...

[Arrowhead1952]

"If you're willing to do right by America, then America is willing to do right by you," he said. "If you will serve your country, we will pay for your college education."

If you will serve your country, we will pay for your college education equates to another liberal entitlement. This is nothing but trying to get the "full-time students" to vote for him.

Just another thing to remember, once an entitlement is in place, it will never be done away with by congress.

[T.Smith]

You sort of beat me to it. I was going to say that a program like this already exists. It's called "The GI Bill" and "Tuition Assistance".

Tuition assistance paid for my undergraduate degree and the GI Bill was enough to pay for graduate school. All I had to do was serve my country for four short years. Not a bad trade.

[NormsRevenge]

Democratic presidential candidate Sen. John Kerry (news - web sites) , D-Mass., raises his hands as he arrives at a rally at City College in the Harlem section of New York, Wednesday, April 14, 2004. (AP Photo/Gregory Bull)

[Badeye]

Kerry's getting more desperate with each passing day.

With good reason.

[So Cal Rocket]

What would they be doing AND how would they pay their rent?

Well, the same way that Kerry does... find a wealthy widow.

[soozla]

NO KIDDING!! What an idiot!!

[debg]

There is plenty of money out there for students to obtain without having to commit to "community service." There is a huge infrastructure already in place to support students who apply themselves and show initiative.

I teach at a small public arts magnet school where last year $5.2 million in scholarship dollars were offered to a graduating class of 121 seniors.

This is just a huge socialistic plan to recruit new members to their ideology.

[sticker]

Kerry's idea? Or maybe

[Renegade]

"We are going to bring about the largest increase in domestic national service in our history," Kerry said.

Wonder if they will all wear brown shirts ??

[Right_in_Virginia]

John Kerry wants to tax your bank account to pay young people to work in the government.

Exactly!

[GailA]

Increasing the number of college students is nice...until the locals get the price tag with higher property taxes and higher state taxes to build NEW buildings and hire more liberal union profs to brainwash more people.

And just where would we get the profs, we are told there are not enough now?

[sticker]

Let's try this again: Kerry's Idea Or Maybe: