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  1. #1
    CareerRuined is offline Newbie 510 points
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    Stafford Loan's Being Cut

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    huffingtonpost.com/mark-kantrowitz/president-O-proposes-_b_823236.html
    Mark Kantrowitz: President O Proposes Cuts in Aid Programs to Preserve Pell Grant

    The new proposed budget for FY 2012 includes a lot of cuts - most notably, cutting certain aspects of both the Pell and the Stafford Loans. The president wishes to keep the Pell grants at $5,550, which is great, but he wants to reduce the number of awards given out per year. To be exact, O wants to cut $100 billion over a decade from Pell Grants and other higher education programs (Chicago Tribune, Feb. 13). This follows a recent Republican proposal that wanted to decrease the Pell grants by $845 (to $4,705 from $5,550).

    The budget proposal would also eliminate the subsidized interest benefit on low interest Stafford Loans which help medical students across the nation. This elimination significantly increases the debt burden of graduate and professional students; namely you guys. The interest rate is 6.8%. This means that losing the subsidized interest benefit will add $1,676 to each $8,500 loan balance by the time the student enters repayment, a 19.7% increase. To add insult to injury, the US Dept. of Education says that the subsidized interest benefit for graduate students is "poorly targeted" at financial need. An average debt burden of $160,000 isn't financial need? We are future providers drowning in debt.

    O's recent statements that Children being the Future ring hollow in light of these budget cuts.

    I guess there is some solace in his announcement - he wants to simplify the FAFSA application process by eliminating certain questions not available from the IRS. However, this proposal (a very similar one to it) fell flat with the Health Care Education and Reconciliation Act of 2010 (around March of last year). I doubt, though, that this outweighs the budgetary restraints outlined above on pre-med and medical students alike.

  2. #2
    Jagoda9193 is offline Junior Member 519 points
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    What about the people who actually NEED the money to finance their education? Where are we supposed to get it from? I do not understand any of this. Can someone explain?

  3. #3
    Glokta is offline Member 515 points
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    I haven't bothered going through the article so I'm taking your post on faith.

    Wouldn't it make more fiscal sense to increase the maximum amount of subsidized loans that can be borrowed and shave some off the pell grant? That way the govt. gets to make rather than merely save $ and students can still pay for their education.

  4. #4
    CareerRuined is offline Newbie 510 points
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    Here is the catch, they are reducing the amount of loans given out, not cutting them. This is because a lot of IMGs do not make it back to America.
    It isn't a solid investment.

  5. #5
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    pope is offline Junior Member 510 points
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    i dont believe everything i hear... there are those people who post things like this to confuse us and make us as americas deprive ourselves of our own rights. check this video out!
    YouTube - Med student perspective of health care reform.

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