'As a student having insufficient income, you are entitled to financial aid for covering the cost of your studies. You should not miss out on any opportunity to get additional funding for your studies. The Pell Grant is now more easily accessible than ever before given that the eligibility criteria have been lowered. The important thing is to apply on time in order to get the money when you need it'.
Consequences of Default
There are very harsh consequences of default on federal student loans. The government has extraordinary power to collect student loans and charge very large collection fees. Most crimes can only be prosecuted for limited periods of time, but there is no time limit for collection on federal student loans..
The three most common government collection tools, Tax Refund Offsets, Administrative Wage Garnishment, and Federal Benefits Offsets, all occur outside of court. It is less common for the government to sue to collect on student loans because it has so many tools to use outside of court. Still, litigation is an additional collection power and the government does use it sometimes.
Lawsuits are the main collection tool that private lenders have. The government and private lenders will also hire collection agencies to try to pressure you to pay.
There may be other consequences of student loan default depending on the type of loan and where you live. For example, a number of states allow professional and vocational boards to refuse to certify, certify with restrictions, suspend or revoke a member’s professional or vocational license and, in some cases, impose a fine, when a member defaults on student loans. The state laws apply to members of the various professions working in that state. Some of these states’ provisions apply to particular professions or vocations such as attorneys, health care professionals, teachers, insurance professionals, state officers, and commercial fishermen. Others apply more generally to anyone whose profession or vocation requires licensing. You should check the laws in your state for more information.
The fact that the economy is coming to a crash is pretty mainstream now----it was created by a bond leverage bubble designed to take out the public sector and wipe out pension and retirement funds for most people. My talk on education policy will address today Obama and Congressional neo-liberals and the Federal Student Loan Interest Rate being changed to market-based tied to the 10 year Treasury ----remember, Clinton neo-liberals, like Republicans use citizens as revenue with corporations paying nothing so this policy was designed to profit from student loans with a higher interest rate. Obama earned hundreds of billions of dollars from the Department of Education each year from Wall Street collection agencies targeting defaulting students. What people need to think about with this market-rate policy is how it is timed to the economic collapse and that bringing very high interest and inflation rates. As this article states------rates on Treasuries are expected to soar. To make sure Obama is clear for whom he works-----they removed the cap on the rate so it can go as high as it can. Now, who will be able to afford these kinds of fees tied to student loans?
'As I write this, the yield on 10 year U.S. Treasuries has risen to 2.51 percent. If that keeps going up, it is going to be like a mile wide lawnmower blade devastating everything in its path. Ben Bernanke’s super low interest rate policies have systematically pushed investors into stocks and real estate over the past several years because there were few other places where they could get decent returns. As this trade unwinds…we are going to see unprecedented carnage. Stocks, ETFs, home prices and municipal bonds will all be devastated and, of course, that will only be the beginning'.
April 9, 2013
Calls Mount for Changing How Interest Rates Are Set on Federal Student Loans
By Kelly Field
President Obama's budget for the 2014 fiscal year, due out on Wednesday, is expected to propose moving to market-based interest rates on federal student loans.
Under current law, student-loan interest rates are set by Congress. On July 1 the rate on one type of loan will double, to 6.8 percent, unless Congress acts to avert the increase.
Congress already postponed the rate increase once, in the midst of the 2012 campaign season. Now, with the one-year reprieve about to expire on subsidized Stafford loans to undergraduates, some interest groups and members of Congress are calling for changes in how the rates on all types of federal student loans are set, to better align them with the government's cost of borrowing.
Last month the U.S. House of Representatives' education committee held a hearing that focused on a plan, proposed by the New America Foundation, to switch to a rate pegged to the 10-year Treasury note.
But some Democrats favor extending the current rate on the subsidized loans. Rep. Karen Bass, a California Democrat, has offered a bill that would permanently cap the interest rate on all federal loans at 3.4 percent. Senate Democrats would extend the 3.4-percent rate on subsidized loans indefinitely, though their budget doesn't include money for the plan.
On Tuesday morning several student-advocacy groups released a report arguing that the government should not profit on student loans, especially at a time when default rates are rising and many recent college graduates are struggling to find work. The report cites recent Congressional Budget Office projections that the government will make 31 cents on every dollar it lends to students next year, for a profit of $34-billion. (The budget office expects the profit to decline to 6 cents on the dollar as interest rates rise.)
In the report, the groups call on Congress to come up with a "comprehensive student-loan solution," or at least a "short-term agreement that is good for students" if a permanent fix "proves politically impossible."
Switching to a market-based rate could save taxpayers billions over the next decade, provided that rates rise, as expected. But it would probably cost taxpayers in the short term, while interest rates are low. It could also cause rates to rise on subsidized loans, at least above the current 3.4 percent.
To protect borrowers when market rates rise, student groups want to cap the maximum rate. Ethan Senack, higher-education fellow for the U.S. Public Interest Research Group, said his organization's priority was to come up with a policy "that is good for students now and good for students down the road."
Given the complexity of crafting a formula that's fair to both borrowers and taxpayers, there's a good chance Congress will put off changing the policy until the next reauthorization of the Higher Education Act, expected to begin next year.
On Tuesday afternoon, Rep. Joe Courtney, a Connecticut Democrat, introduced a bill that would postpone the interest-rate increase for two years, to give Congress "time to craft a thoughtful long-term solution to address this growing problem," according to a news release.
Correction (4/10/2013, 10:24 a.m.): This article originally misstated part of a plan proposed by the New America Foundation. Under the plan, student-loan interest rates would be pegged to the 10-year Treasury note, not the three-year Treasury note. The article has been updated to reflect this correction.
Meanwhile the bond market is getting closer to collapse and all that Baltimore School building bond leverage of $1billion dollars will lead to default-----handing Baltimore's newly constructed public schools to private investment firms to use for charter chains no doubt.
Bond Market Facing Scrutiny; Why Stocks Could Face Same Future
By Michael Lombardi, MBA • Friday, June 5, 2015 Email Over the past few years, buying bonds was the trade. Be it government bonds, municipal bonds, or high-yield corporate bonds. Thanks to the Federal Reserve, every time interest rates were lowered, or every time there was an announcement of new quantitative easing by the Fed, bond prices soared and investors in those bonds made a lot of money.
Now bond investors aren’t looking so happy. The Federal Reserve, with its repeated statements about raising interest rate this year, has sent bond prices down and investors in U.S. bonds have been running for the exit door for weeks now.
According the Federal Reserve, the bellwether federal funds rate is expected to increase to 0.625% this year from its current 0.25%. Then, it’s expected to rise to 1.625% in 2016, and reach 2.625% by 2017%. (Source: Federal Reserve, March 15, 2015.)
Understand this: the hike in the federal funds rate may not sound like much, but on a percentage basis, between 2015 and 2017, interest rates set by the Federal Reserve are expected to increase by 950%! Rising interest rates are bonds’ biggest enemy. As interest rates rise, bond prices plummet.
I am definitely not against funding trade apprenticeships and vocational certification. What we are seeing is simply job-readiness that should be on-the-job training taking more and more of what was higher education funding. I am just pointing to the movement for most families away from any access to higher education funding and the increase in low wage job tracking that is connected to these community college programs. This Clinton neo-liberal remake of the Federal loan structure will send much of Federal funding to research facilities to subsidize corporate universities ----AND THAT IS WHAT A NEO-LIBERAL SEES AS THE FUTURE OF FEDERAL SPENDING FOR THE AMERICAN PEOPLE AND HIGHER EDUCATION.
Remember, this Federal funding is Constitutional and it should be Equal Opportunity and Access across the board in higher education, but Clinton and Obama use the Federalism Act to ignore these Federal requirements and instead make these Constitutional benefits into corporate profits with taxpayers paying for all corporate Human Resources and corporate Research and Development.
States like Maryland had Governor O'Malley and the Maryland Assembly just throwing all of the state funds for higher education into this same path------with state financial aid being called 'unaffordable'.
'Similar to last year’s proposal, the budget plan also calls for a Race to the Top for Higher Education program, which would provide $1 billion to support competitive grants to states that “commit to driving comprehensive change in their higher education policies and practices.”
All eyes on Pell Grants, job training funding
By Times Staff, Published February 14, 2011
Although the Obama administration on Monday released its proposed budget for fiscal year (FY) 2012, community college advocates are focused on the House of Representatives, which will likely vote this week on a bill that would slash current-year funding for Pell Grants and eliminate or cut most federally funded job training programs.
The bill, H.R. 1, would reduce the Pell Grant maximum by $845, to $4,705, for the award year that starts July 1, 2011.
“The legislation has the worthwhile goal of reducing the federal deficit, but it goes about it in ways that community colleges cannot accept,” said Walter Bumphus, president and CEO of the American Association of Community Colleges. “At a time when community colleges are struggling to serve the unprecedented numbers of students who have turned to our institutions in these difficult economic times, I believe that this is a seriously misguided approach.”
Reducing the maximum Pell Grant by $845 is equal to increasing tuition for the community college students who are most in need of financial assistance, he said.
“This is unacceptable and will only serve to hurt our economy, and our communities, over the long term,” Bumphus said.
H.R. 1 proposes other cuts to programs important to community colleges. For example, the bill would terminate funding for the rest of FY 2011 for the major Workforce Investment Act (WIA) Title I formula programs, which serve adult, dislocated workers and youths. It would also nix most WIA grant programs—such as appropriations for Tech Prep and predominantly black institutions—in addition to deeply cutting other areas, such as funding to Hispanic-serving institutions.
Keeping the Pell maximum
Obama’s FY 2012 budget would keep the maximum Pell Grant amount at $5,500, but to do so the administration wants to stop providing the grants yearround. In order to sustain the program in a responsible way, administration officials said they are proposing saving billions by eliminating subsidies for graduate students with loans and eliminating a provision that enables some students to receive two Pell grants in a single year.
"These are very tough choices but with rising demand, we have to stretch our dollars as far as possible and do more with less," said Education Secretary Arne Duncan.
The U.S. Department of Education expects demand for Pell Grants to reach 9.6 million students next year, up from 6 million in 2008. The president's budget protects recent increases in the maximum grant to $5,550 while ensuring that all eligible students continue to be served, according to the department.
At a budget briefing on Monday, Obama noted that the grants are needed to help eligible students succeed in programs such as engineering and math, which are critical to U.S. economic competitiveness.
“That’s why we’re protecting the more than $800 increase that we added to the most widely used federal scholarships, and making the tough choices to put them on a firm footing for years to come,” he said in reference to Pell Grants. “And that’s why we’re on track to meet the goal that I set when I took office: By 2020, America will once again have the highest proportion of college graduates in the world.”
In other areas, the proposed budget would increase funding for: adult education state grants to $635 million; minority-serving institutions to $653 million; and TRIO programs to $920 million. However, it would cut funding or career and technical education and Tech Prep.
A new workforce fund
The president’s budget also calls to create a new $380 million Workforce Innovation Fund. States, regions and localities would compete for funding by showing their commitment to transforming their workforce systems, testing new ideas and replicating proven strategies to deliver better employment and education results at a lower cost. The initiative would be co-run by the U.S. Education and Labor departments.
“Like the new Trade Adjustment Assistance Community College and Career Training Grants, the Innovation Fund will create incentives for grantees to consider evidence in designing their programs, collect better data to know what is working well and what is not, and find ways to make program dollars stretch further,” according to the budget outline.
The president is also requesting increased funding for the National Science Foundation to encourage students to considering careers in science, technology, math and science (STEM). The proposed budget includes $20 million for a science and technology workforce program geared toward undergraduate students from historically under-represented groups in those fields, including students at Hispanic-serving institutions.
When Obama and Clinton neo-liberals say they are restructuring Federal funding for higher education they are saying ----WE ARE DISMANTLING THE GOAL OF THIS ACT WHICH IS EQUAL OPPORTUNITY FOR HIGHER EDUCATION AND WE ARE MAKING IT ABOUT ALLOWING THIS MONEY TO BE USED FOR ANYTHING.
Everyone had the ability to be hired and trained on the job-----everyone had the right to join a trade union apprenticeship ------so all of this money is now wasted and will not provide opportunity or access to higher education.
Meanwhile, using all of this community college job training as a degree, Obama and neo-liberals are claiming graduation with degrees are soaring under these policies!
Published: 21-12-2010, 16:00
Equal Educational Opportunities Act (EEOA)
The struggle for equality and nondiscrimination in education at all levels has a long history in the United States. Following Brown v. Board of Education (1954) and the ensuing civil rights struggles of the 1950s and 1960s, Congress passed Title VI of the Civil Rights Act of 1964, which prohibits discrimination based on race, color, age, creed, or national origin in any federally funded activity or program. In addition, the Fourteenth Amendment to the U.S. Constitution, adopted in 1868, declares that no state may deny any person the equal protection of the laws. This amendment protects the privileges of all citizens, provides equal protection under the law, and gives Congress the power to enforce this amendment through legislation.
In 1974, Congress enacted the Equal Educational Opportunities Act (EEOA) to champion the rights of all children to have equal educational opportunities. Insofar as the EEOA addresses the rights of students who may hope to continue their studies in colleges and universities, this entry reviews the act’s background and impact in K–12 settings. While focusing largely on K–12 issues, this entry is designed to provide educators and others who are interested in higher education with the ability to understand how the EEOA might impact the rights of the students with whom they interact on their campuses.
Background In 1968, the Department of Health, Education and Welfare (HEW), now the U.S. Department of Education, which has authority to disseminate regulations prohibiting discrimination in federally assisted school systems, issued a guideline clarifying that school officials are responsible for ensuring that students are not denied educational opportunities that are equal to those of their peers due to their race, color, or national origin. Later, HEW issued a memorandum on May 25, 1970, in an attempt to clarify the responsibilities of school board officials to provide equal educational opportunities to English language learners under Title VI. According to the memorandum, programs for students whose English is less than proficient should be designed to teach them English as soon as possible. The memorandum added that this approach should be carried out in a meaningful way that affords students who are non-English speakers the academic and social language skills that they need to succeed in school and life. The memorandum further stipulated that school boards have the duty to communicate with parents regarding their children’s education in a language the parents can understand. The memorandum also explained that students could not be placed in special education programs based solely on their inability to speak English.
In March 1972, President Nixon addressed the nation on two companion proposals. The proposals were aimed at providing the judiciary with a new and broader base on which to review future cases relating to equal educational opportunities, to place the emphasis on providing better education for all children, and to set forth alternatives to busing. The president’s definition of equal educational opportunity set the stage for what in 1974 would become the EEOA. The alternatives to busing were intended to preserve “neighborhood” schools.
In its landmark decision on the rights of language minorities, the Supreme Court in Lau v. Nichols (1974) held that students with limited English proficiency (LEP) who were not provided with special programs to help them learn English were being denied their rights under Title VI of the Civil Rights Act of 1964. In Lau, the Court held that the San Francisco Unified School District should have provided instruction in English to non- English-speaking Chinese students or provided them with instruction in their native language. The Court also pointed out that merely providing students with the same facilities, textbooks, teachers, and curriculum does not constitute equal treatment. In other words, the Court reasoned that students who do not understand English are effectively foreclosed from any meaningful education. At the same time, the Court upheld HEW’s 1970 memorandum as a valid interpretation of the requirements of Title VI. Lau v. Nichols was also important because it renewed interest in Nixon’s proposal to focus on equal educational opportunity for all students.
Provisions of the Equal Educational Opportunities Act Shortly after Lau, Congress passed the EEOA. This act, along with the Bilingual Education Act, was part of the 1974 amendments to the Elementary and Secondary Education Act. The EEOA affirms that no state shall deny educational opportunity based on race, color, sex, or national origin by engaging in deliberate segregation by an educational agency; failing to remedy deliberate segregation; assigning a student, other than to a school closest to his or her residence, that results in a greater degree of segregation of students on the basis of race, color, sex, or national origin; discriminating by an educational agency on the basis of race, color, or national origin in the employment of faculty or staff; transferring students from one school to another, voluntarily or otherwise, if the purpose and effect of doing so would have increased segregation on the basis of race, color, or national origin; or failing to take appropriate action to overcome language barriers that impede equal participation by its students in its instructional programs.
The EEOA allows individuals who have been denied equal educational opportunities to file civil suits in appropriate federal trial courts against such parties as may be appropriate. In addition, the attorney general of the United States may institute civil actions on behalf of individuals. However, this power is rarely implemented, because most challenges emanate from parents and advocacy organizations. Despite the intent of the law, the vague language of the EEOA has left it to the courts to decide and shape the concept of equality in education for LEP students. The constitutional issue is the right of national origin minorities to have equal educational opportunities, a question that is making its presence felt in many institutions of higher education, because a significant number of enrolling students are lacking in basic skills.
Litigation In 1981, in Castañeda v. Pickard the Fifth Circuit established a three-prong test to evaluate whether educational officials have violated the rights of students who were LEP. The first prong inquires whether officials are pursuing a program informed by educational theory that is recognized by experts as sound. The second examines the steps that officials are taking to implement the approach, including whether they are providing the resources necessary to implement it effectively. The third question concerns whether, after a “legitimate trial” period, officials have examined the results of the program for results and modified it if results were not forthcoming. Furthermore, the court determined that students who are LEP should have not only the opportunity to learn English but also full access to the school system’s educational program.
When evaluating programs for students who are LEP, the courts require educators to meet all three of Castaneda’s prongs for both the teaching of English and the teaching of the entire curriculum. Although most courts relied on the Castañeda standard, the three-prong test is not without its judicial critics, as illustrated in Teresa P. v. Berkeley Unified School District (1989). This case also raised the issue of discrimination against Mexican Americans in the hiring and promotion of teachers and administrators.
Using the Castañeda standard in Keyes v. School District Number 1 (1983), the federal trial court in Colorado was of the opinion that traditional bilingual educational programs that taught English and provided understandable instruction in content areas was a sound educational theory. Nevertheless, the court remarked that the implementation system was inadequate due to a lack of emphasis on reading and writing, an apparent lack of regard for the curriculum needs of students who are LEP, and a lack of testing. Because school board officials had not provided the mandated program, the court did not address the third prong, holding that evaluating results at that point would be premature. The Keyes court decided that although the facts of the case did not require bilingual education as an exclusive means of access to students who were LEP, it might be required in specified circumstances. The court concluded that the issue was not whether bilingual programs were the least reparative manner for providing language instruction but whether the degree of separation is necessary to achieve the educational goal of the program in light of the fact that the students spoke Spanish.
State education agencies have been included in the enforcement of the EEOA. In 1982, in United States v. State of Texas, the Fifth Circuit required state education agencies to adopt guidelines regarding services provided to students who were LEP and to ensure that these guidelines were monitored and enforced. Previously the Ninth Circuit had posited, in Idaho Migrant Council v. Board of Education (1981), that state educational agencies have a duty to supervise local school boards to ensure compliance with federal mandates ensuring that the needs of students who are LEP are being met.
A current long-running case, Flores v. Arizona, was filed in the federal trial court in 1992 as parents and others alleged that state officials failed to provide students who were LEP with instruction making them proficient in English and enabling them to master the standard academic curriculum. In 2000, the court ruled that officials neither adequately funded the program nor provided enough teachers, paraprofessionals, classrooms, resources, or tutors for students who were LEP. The court thus ordered state officials to complete a cost study to establish the needed funding to implement programs for students who were LEP. As a result, the parties entered into a consent decree on nonmonetary issues, including a requirement that the state board and the department of education adopt rules and regulations for English language instruction, compensatory instruction, and monitoring by the department to ensure that students who were LEP had equal educational opportunities.
During the next phase of the litigation, in 2001, the cost study was released. However, because the study was of limited usefulness, the court ordered the state to provide adequate resources to educate students who were LEP by January 31, 2002, or by the end of any special session, whichever came first. After the legislature failed to appropriate sufficient funds, additional litigation ensued, culminating in the Ninth Circuit’s ultimately affirming that the state of Arizona was required to fund programs for English language learners fully in order to comply with the EEOA (EEOA). On further review in Flores v. Arizona (2009), the Supreme Court reversed and remanded the dispute for further consideration. In other words, the Court ruled that in light of legal and factual changes, such as Arizona’s shift away from bilingual education to structured immersion for ELL students and changes mandated by the No Child Left Behind Act with regard to the finding and programs for these children that took place since the lower courts agreed that state officials violated the EEOA, the state was entitled to present its position that it was entitled to relief from those earlier judgments.
Since the enactment of the EEOA, litigation has addressed issues of proper identification of LEP students for services, oversight and monitoring of programs, teacher quality and training, and funding. As more litigation ensues, it appears that because local and state educational agencies have continued to fall short of providing adequate services to LEP students, the responsibility of better educating these students will be felt when they enter institutions of higher learning, from community colleges through research universities, because these students are very likely to need remedial instruction in order to ensure their access to equal educational opportunities.
At the same time national AFL-CIO leaders are supporting Clinton neo-liberals at all levels and acting as cheerleaders for this restructuring of higher education----they are becoming the source for loans whether student loans, home mortgage loans-----I saw AFSCME partnered with Wells Fargo and I am sure these AFL-CIO student loans are partnered to a Wall Street bank. This is what has killed labor unions in the US-----these unions are structured to be banks and act as investment firms, and community development sources paired with Wall Street community development. Meanwhile, Clinton neo-liberals are killing their labor members and all US workers. Union Plus LaborCorps Education Grants
With student loan debt surpassing $1 trillion, Union Plus is now offering grants to assist young labor activists with the high cost of their student loans.
Young labor activists who work full-time for an eligible labor union or affiliated labor organization can apply for a grant of up to $2,000 to help pay off their student loans.
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- Current full-time employees of an eligible labor organization for a minimum of two years.
- 35 years of age or younger.
- At least $10,000 in outstanding federal or private student loan debt.
- See full eligibility details below.
- Amounts are based on the number of years employed at a qualifying labor union/organization job:
- Two years - $500
- Three years - $1,000
- Four years - $1,500
- Five-plus years - $2,000
- Grants are paid directly to the financial institution that holds the student loan.
- Lifetime limit: one LaborCorps Grant.
Register to create your LaborCorps Education Grant online application. You can complete your application in steps, saving your information and then submit your completed application.
Required items include employment, union and student loan information, plus two required essays.
If you meet the requirements, you’ll receive a grant—but grants are only available for as long as funds last.
**LaborCorps Grants are only available for as long as funds last.**Grant Award Date:
Labor Day, Monday, Sept. 2, 2013. By Labor Day, grant recipients will be notified individually.