The cost of college has skyrocketed in recent decades, and few higher education observers say they know how to reengineer the affordability problem.
A chart produced by Bloombergshows that tuition expenses have spiked 538 percent since 1985. That's compared to a 286 percent increase in medical expenses and a 121 percent increase in the consumer price index.
After doubling on July 1, student loan interest rates for millions of Americans will be restored to 3.86 percent.
President Barack Obama signed a student loan bill late Friday afternoon designed to keep interest rates low - at least for now - by tying them to the financial markets.
Economists predict the new rates for undergraduates will remain lower than expected in the coming years.
The U.S. Senate has reached an agreement on a bill that would tie student-loan interest rates to market-based rates. The deal comes just three weeks after interest rates doubled on July 1, concerning everyone from high school seniors to their parents.
Under the plan, interest rates would roll back to 3.8 percent. If the market goes up, student loan rates would go up, and they’d be capped at 8.25 percent for undergraduates and 9.5 percent for graduate students.
“To get it through Congress, we had to agree to a cap,” said Republican U.S. Sen. Tom Coburn of Oklahoma, part of the bipartisan group of senators that supported the bill. Speaking on WGBH’s The Takeaway, Coburn said the deal would prevent any new taxpayer losses.
After a group of senators announced a deal on student loan interest rates last week, Massachusetts Senators Ed Markey and Elizabeth Warren continued to attack the plan on Monday that they say would create ‘outrageous profits’ for the federal government.
It was only his fifth day on the job, so you couldn’t blame Senator Ed Markey for trying to redirect questions about student loans to the senior senator from Massachusetts.
Looking over Marina Bay in Boston, Markey stood with Senator Warren during a press avail, and credited her for asking why the government is raking in billions of dollars on federally subsidized student loans.
College students may have dodged a bullet. Senators reached a tentative deal with President Obama Thursday that would roll back interest rates on new federal student loans.
The stalemate in Congress forced student loan interest rates to double on July 1. This new deal would cap rates at 8.25 percent for undergraduates and 9.5 percent for graduate students. It would also tie loans to market-based rates. So if interest rates go up, student loans would also go up.