Biden, Obama plan to assist students financially

Jennifer Shore

Vice President Joe Biden

Listen to Biden talk about education.

In 1961, Joe Biden, a high school senior at the time, visited his father at work to borrow the car for his prom, which was that night. His “graceful, well read, elegant,” father was pacing in the parking lot, and he looked up and said, “Joey. I’m so sorry. I went to the farmers’ bank to see if I could borrow money to get you to school, and honey, they won’t lend me the money. I’m so sorry. I’m ashamed.”

Now, as vice president, Joe Biden believes no parent should be ashamed in this country if his or her child is academically qualified to get to school.

“It’s in the overwhelming interest of this country that everybody who is able to get a college degree get one,” Biden said on Feb. 2 in a conference call for student journalists.

Biden added to the higher-education reforms President Obama briefly spoke about during the State of the Union address on Jan. 24, which emphasized a need for tuition aid reform – especially for those students who have parents unable to afford the cost of tuition.

“Of course, it’s not enough for us to increase student aid,” Obama said during the speech. “States also need to do their part, by making higher education a higher priority in their budgets, and colleges and universities have to do their part by working to keep costs down.”

There are three primary incentives to helping students pay for school and universities to lower tuition: low interest rates, raising the number of work-study programs and tax credits.

Low Interest Rates

“Right now the interest on student loans is supposed to literally double this summer, from 3.4 percent to 6.8 percent,” Biden said. “If we don’t act, 7.4 million borrowers are going to see their payments go up and go up significantly.”

Although the president asked congress to suspend the hike for a year, the government will still receive revenue off of the existing interest rate, which is expected to be poured back into funding programs for students.

Work-Study Programs

“Another thing we’re doing to help ya’ll is we are — to help, actually, the nation — is we are going to double the number of work-study programs that we have in play,” Biden said.

Approximately $1 billion is spent each year on the work-study program, which allows 710,000 students to earn money while working toward a degree.

“The school has to provide some matching funds for this, but we’re going to double those programs, so that you guys, who are busting your neck to stay in school, who are good students and qualified but having trouble, that you’ll be able to find another vehicle,” Biden said.

Student Tax Credits

More than 9 million college-paying Americans take advantage of the Obama administration’s American Opportunity Tax Credit, according to the White House fact sheet.

During the address, Obama asked Congress to extend the tuition tax credit through 2012 to save the middle-class thousands of dollars each year.

“Higher education can’t be a luxury,” Obama said. “It’s an economic imperative that every family in America should be able to afford.”

Contact Jennifer Shore at [email protected].