Obama responds to the 99 percent

Band-aids or benefits?
By DEIRDRE FULTON  |  November 9, 2011

In announcements that could be interpreted as gifts to the Occupy movement, President Barack Obama recently introduced three measures to help struggling students, veterans, and homeowners.

All of these executive actions are part of the Obama Administration's "We Can't Wait" platform that criticizes Congress for stalling on (or outright blocking) key pieces of the president's jobs plan.

According to the White House press office, more than 7000 current students in Maine will be able to lower their monthly loan bills through the "Pay As You Earn" program that would reduce payments to 10 percent of a borrower's monthly income. The program, which was scheduled to begin in 2014 and will affect about 1.6 million students, will now go into effect next year.

An additional 19,000 borrowers in Maine will able to reduce their interest rates and consolidate their student loans starting in January 2012.

Student-loan debt, which currently surpasses credit-card debt in this country, is now estimated to be between $550 billion and $829 billion, according to the Federal Reserve Bank of New York and FinAid.org. About 65 percent of college graduates have at least some student debt. Default rates are rising. According to the Project on Student Debt, Maine ranks third-highest in the country in average student debt.

The issue "is a recurring theme" on #OWS websites, forums, and signs, says University of Southern Maine philosophy professor Jason Read, who spoke at the October 10 Occupy Maine teach-in. In New York City and elsewhere, #OWS folks have called for widespread student-debt forgiveness or a massive halt to payments.

"I do not think that there is a direct causal connection [between the executive actions and the Occupations], but I do think that Obama has been able to utilize the way in which the Occupy movement has made student debt more visible," Read says.

Over at the Lincoln Park encampment (which will be open for "tours" this Saturday — see "8 Days A Week," page 14), Occupiers weren't too familiar with the specifics of Obama's executive actions, but they are skeptical of so-called "quick fixes."

"In order to get an education you have to take on massive debt," says Steve Demetriou, 55, who lives in Portland and is helping the Occupy Mainers set up some winter structures. Of Obama's student-debt plan, he says, "Band-Aids don't work. It's a step in the right direction, but it doesn't acknowledge the systemic problems we have in this country."

Jennifer Rose, a 28-year-old former student staying at the tent city, estimates that she has taken on about $60,000 in debt. Such a financial burden only adds to growing inequality, she says.

"Free education should be available to everyone," she says.

Meanwhile, while federal data showed last week that unemployment rate for veterans is climbing (it's at 12.1 percent for post-9/11 vets, and more than three points higher than for civilians), the White House is working to publicize programs that offer tax creditsto employers that hire veterans.

And on October 24, the administration announced actions that would help homeowners refinance their mortgages with low-interest rates and help unemployed borrowers stay in their homes longer without fear of foreclosure.

More Band-Aids? We'll see.

  Topics: This Just In , Barack Obama, Student Loans, Money,  More more >
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