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Education and Student Debt

Education

Since the passage of No Child Left Behind, schools have experienced unprecedented levels of stress and pressure as educators have narrowed curriculum, decreased the time spent on actual instruction, and even resorted to “gaming the system” and cheating in order to meet the law’s stringent testing requirements. The quality of instruction has suffered as the emphasis on rewards and sanctions based on test scores has increased.

And, contrary to his campaign trail rhetoric, the Obama administration’s Blueprint and its Race to the Top program continue to emphasize the worst aspects of No Child Left Behind. Furthermore, by requiring states to implement unproven “reforms” and compete for Title I funds, the current policy destroys the original intent of the Elementary and Secondary Education Act: equalizing educational opportunities for all by supplementing the resources and funds available to our nation’s neediest students and schools. 

(The text of the above paragraphs was taken from the Save Our Schools website).

Groups like Save Our Schools and United Opt-Out have been pushing to save pubilc education in the United States.

Read more about the Save Our Schools platform by following the links on their "About" page. And there are excellent reading resources and tools at the United Opt-Out Reading and Resources page.

 

Student Debt

Since 1980, the cost of a college education in the U.S. has risen 900%, many times higher than inflation. Over the same period, federal student aid programs, such as Pell Grants, have shrunk from covering approximately 70% of total public college costs to only 34%. As a result, more and more students have been forced to take out loans to pay for school, loans that have become much harder, if not impossible, to pay back. The average student today graduates with $25,000 of debt, and default rates are as high as one in three.

This situation is no accident. Private lending corporations have turned higher education financing into a predatory lending system where they—and the government—make more money when a borrower defaults. This is because of exorbitant penalties and compounded interest that continues to accrue after default, and because congress has stripped away all basic consumer protections from student borrowers and sanctioned draconian collection powers never allowed before in U.S. history. Student loans are not dischargeable in bankruptcy, nor are they subject to statutes of limitations, state usury laws, or the Fair Debt Collection Practices Act. Furthermore, the lending system can take a borrower’s wages, income tax returns, Social Security and even Disability income, as well as exclude her from public employment, decertify her professional credentials, and more.

Such unprecedented collection powers have resulted in an 85% recovery rate on defaulted student loans, at amounts that are often two to three times higher than the original principal borrowed. This earns windfall profits for private lenders and collection agencies, as well as a sizable return for the Department of Education (DOE), which earns, according to one estimate, about $6,500 more in interest from a $10,000 loan that defaulted than if it had been paid in full over a 10-year term. In a predatory system like this, where both the loan servicer (private corporations) and the loan guarantor (the US Government) profit from defaults, not only is there no motivation to change, but there is a financial incentive to make more and larger loans. This is what happened during the housing bubble that artificially drove up home prices, and this is the primary reason higher education costs are skyrocketing today. As colleges raise tuition in response to congressionally-approved increases in Stafford loan ceilings, private debt servicing corporations like Sallie Mae (who lobby for higher ceilings and whose former executives hold key staff positions in the DOE) are making millions in profit while relegating an entire generation to indentured servitude.

The causal relationship between rising tuition and institutionalized predatory lending is becoming more widely recognized as a growing student movement has begun to challenge the privatization of higher education. Students from California to New York are organizing, with demands ranging from tuition freezes to complete student debt forgiveness (“jubilee”) and a return to a fully-funded, free public university system. The Student Loan Forgiveness Act of 2012 (H.R. 4170) is a step in the right direction and would cap student interest rates at 3.4% as well as forgive student debt for those borrowers who make payments equal to 10% of their discretionary income for 10 years. Other proposals include returning bankruptcy protections to student borrowers and closing the “revolving door” at the DOE’s Office of Federal Student AID, which is composed largely of former Sallie Mae executives and other private financial industry representatives. Even these modest reforms, however, are being fought by private loan servicing corporations, and given the corruption within congress, will require a mass movement of community education, protest and civil disobedience.

References & external links:

http://www.thenation.com/article/167142/colleges-withhold-transcripts…

http://www.usnews.com/usnews/edu/articles/031027/27loans…

http://online.wsj.com/article/SB1000142405274870472…

http://www.dailykos.com/story/2011/05/05/973554/-Tuition…

http://studentloanjustice.org/defaults-making-money.html

http://www.nytimes.com/roomfordebate/2011/10/27/should…

http://www.nontradlaw.net/blog/index.php/archives/583

http://www.commondreams.org/archive/2007/04/21/674

Source: Occucards.com

 

The Corporate Assault on our Teachers

Its Our Economy
August 11, 2012
 
A massive assault on American teachers, their unions, and their standard of living has been underway now for several years and has continued to intensify. Since the so-called ‘end’ of the recession in June 2009, nearly 700,000 public employees have been laid off, more than 400,000 of whom have been teachers. Teachers’ health care and pension benefits are especially in the ‘cross hairs’ target. States continue to dump their fiscal problems onto cities and school districts, leading to a growing trend toward municipal bankruptcies and defaults, which will eventually lead to a crisis in the $3 trillion dollar municipal bond markets as well.
 
As dire as the short term crisis for teachers and American education is, corporate America and politicians across the board in both parties have a longer run plan for reducing spending on k-12 education, levied on the backs of teachers in particular. The following article–’The Corporate Vision for American Education’ — outlines the fundamentals of this long run plan that has been in development for more than a decade now, and fully embraced by both the Bush and Obama administrations.
 

 

 

The Big Business of Charter (when you see the word "charter" think "corporate") Schools

By Valerie Strauss
Washginton Post, August 17, 2012
 
(Excerpts)
 
If you are wondering why you should add charter schools to your investment portfolios, here’s David Brain, head of a major investment concern called Entertainment Properties Trust, to tell you.
 
Entertainment Properties. . .  website . . . says this: “Our investment portfolio of nearly $3 billion includes megaplex movie theatres and adjacent retail, public charter schools, and other destination recreational and specialty investments.
This is why some people see the growth of charter schools run by for-profit management companies as part of a movement to privatize the country’s public education system, which has been the country’s most important civic institution. 
 
Above is a video — with the headline “Invest in Charter Schools?” — that shows an interview that Brain did with anchors at CNBC. Here is part of the dialogue:

DB: . . . it’s a very stable business, very recession-resistant. It’s a very high-demand product. There’s 400,000 kids on waiting lists for charter schools ... the industry’s growing about 12-14% a year. So it’s a high-growth, very stable, recession-resistant business. It’s a public payer, the state is the payer on this, uh, category, and uh, if you do business with states with solid treasuries. then it’s a very solid business.

 

Anchor: David, there has been somewhat of a public backlash to charter schools in some areas given their use of public money, as you noted. Any risk to the growth of charter schools generally?
 
DB: I don’t — there’s not a lost of risk, there’s probably risk to everything but the fact is, this has bipartisan support. It’s part of the Republican platform and Arne Duncan, secretary of education in the Obama administration, has been very high on it throughout their work in public education. So we have both political parties very solidly behind it, you have high demand, high growth, you have good performance across the board. Most of the studies have charter schools at even or better than district public education. So, I think it has some risk because it’s new and it’s emerging and it is a high-growth category. But at the same time I think ... much more’s going forward so it’s still a safe area for investment.
 

Privatization of Public Schools

How are corporations undermining K-12 public education in these bills?
 
Through ALEC, corporations, ideologues, and their politician allies voted to spend public tax dollars to subsidize private K-12 education and attack professional teachers and teachers' unions by:
 
Promoting voucher programs that drain public schools of resources by using taxpayer dollars to subsidize private school profits, and specifying that those schools must remain unregulated. Voucher programs have been pushed in the following ways:
 
Offering private school vouchers with "universal eligibility" (using taxpayer dollars to subsidize private schools for the rich and others); " means-tested scholarship," (using poverty as the first domino in an effort to privatize public schools); and "universal eligibility with means-tested scholarship." (Here, "scholarship" means using taxpayer dollars to pay private school tuition and/or profits.)
 
Giving tax credits to parents who send their kids to private schools, (see this bill, this bill, and this bill) and to corporations that donate to scholarships for private schools.
 
Creating a scheme to deem public schools "educationally bankrupt" to rationalize giving taxpayer dollars to almost completely unregulated private schools, rather than addressing any problems.
 
Back-dooring privatization by creating voucher programs to subsidize unregulated, for-profit schools or religious schools for specific subsets of students, such as foster children, or children of military families.
 
Evading requirements under the Individuals with Disabilities Education Act (IDEA) by preying on parents of children with special needs through subsidies for unproven and profit-driven private schools, which are not covered by the IDEA. (See this bill, this bill, and this bill.) Nearly identical bills have been introduced in Wisconsin and other states.
 
Segregating students with disabilities from non-disabled students by incentivizing the creation of largely unregulated private schools for students with disabilities, and then allowing private schools to refuse children's admission such that the private testing/evaluation scores can be higher than for public schools that must take all students.
 
Setting up low-income students for failure in college by incentivizing early graduation for the students in need of a complete high school education.
 
Taking charter school authorization away from local school boards in favor of a statewide advisory committee, that a governor can pack with pro-voucher people.
 
 
Certifying individuals with no education background as teachers, a move that would weaken the quality of education, that fails to recognize there is more to teaching than knowledge of a subject, and that would undermine the role and competitiveness of professional teachers (see also this bill).
 
Eliminating tenure for teachers in favor of "performance," allowing districts to fire older teachers in favor of lower-cost young teachers.
 
Undermining teacher's unions indirectly through the above bills, and directly through bills like this one, this one, and this one. See also the anti-union bills on the Worker Rights page.
 
To see a full list of these bills, click here.
 
Source: ALEC Exposed

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