On Tuesday, UNC played host to Obama as he pitched his plan for interest rates on student loans. The speech was interesting for several reasons. The first reason it was interesting was that it was largely uninteresting. To be honest, I could care less about whether the interest rate on Stafford loans will be 3.4% or 6.8%. Admittedly, this is partly a selfish consideration on my part. If the interest rates are allowed to revert, the change will only affect new loans. As a graduating senior, I have no plans to accumulate any more educational debt.
However, even if this were not the case, the change itself is quite mild. First, the change only affects subsidized Stafford loans (and only those issued to undergraduates), not un-subsidized loans (which currently have an interest rate of 6.8%) and not PLUS Loans (which currently have an interest rate of 7.9%). Second, even the dollar amount involved is fairly small. Assuming that the average student completes his degree in four years, the maximum amount of subsidized debt he can accumulate in those four years is $19,000. Assuming he has $19,000 in subsidized debt, his monthly payments (which, incidentally, start 6 months after graduation) will increase by about $53.83. Of course, it would be nice to be able to keep that extra $53, but when your country is almost $16 trillion in the hole, something’s got to give.
To be honest, the fact that the President is running around campaigning for what is ultimately a trivial change is kind of infuriating. Lower interest rates on your loans won’t do you any good if you don’t have a job that makes money to pay back those loans. A recent report by the Associated Press reports that half of all new college graduates are either completely jobless or underemployed. With such a depressing job outlook, it won’t matter how high the interest rates on college loans are; no one will be able to afford to pay them back anyway. During his speech, Obama implored the audience to begin using the #DontDoubleMyRate hashtag on Twitter. I’d like to suggest a slight modification: #DontDoubleMyUnemploymentRate. Job prospects are dismal, and Obama has done nothing but exacerbate the situation.
However, what was most striking about the whole event wasn’t the triviality of the speech, but the reception Obama received from the approximately 8,000 assembled students. After nearly four years of this man’s economic mismanagement and botched “fixes” (not to mention a “recovery summer” or two), students still adore him. The tone of the speech was quite weird. It bounced from droning policy wonkishness to sports talk to some sort of pseudo-revival. And the crowd ate it up. From the “amens” to the mutual declarations of love, the crowd was almost electric. Many students camped out overnight just to get a ticket and then stood in line for over 8 hours just to get a seat. Because of this, I have trouble believing that there is some sort of enthusiasm problem for Democrats in this election. Based on what I saw in what is technically a swing state, the Democratic Party is doing just fine.