DENVER — As anticipated, President Obama Wednesday morning detailed his plan to use an executive order to ease the burden of student loan debt that presently presses down on tens of millions of Americans. Speaking in shirtsleeves and drawing on his own struggles with student debt as a young man, husband and father, Obama told the energized crowd in an event center hall on the downtown university Auraria Campus that he was determined for the foreseeable future to act wherever possible to relieve economic distress in the country without going through the gridlocked Congress.
“The reason I’ve been hitting the road so much is because the people I’ve been talking to in cities and small towns, in communities all across America, let’s face it, they make a lot more sense than the people back in Washington.”
Revving up to full campaigning form, Obama said people around the country are hurting, looking for work for months and years, and he reiterated the point, underscored by the Occupy Wall Street protesters lined up outside the building and at the back of the hall, that the deck has been stacked in favor of the wealthy and powerful and that it has been that way for decades, to the detriment of the country.
“For decades too many of our institutions, from Washington to Wall Street, failed to adapt [to the globalized world] or they adapted in ways that didn’t work for ordinary folks… We had a philosophy that said if we cut taxes for the very wealthiest and we gut environmental regulations and we don’t enforce labor regulations, that somehow, you know, if we just let Wall Street write the rules, then somehow that was going to lead to prosperity. Instead, it led to the financial crisis and the deepest recession since the Great Depression.”
The status quo has to change, he said, and added that Republican lawmakers “don’t share our sense of urgency.”
“We’re not going to wait for Congress. I’m going to act with or without Congress. Where they won’t act, I will, through a series of executive orders…. We’re going to look every day to see what we can do without Congress.”
Taking action now on skyrocketing debt
The plan Obama laid out today will speed up student loan repayment reforms passed last year but not scheduled to take effect until 2014. His executive order will lower to 10 percent the maximum percentage of income students will have to pay toward their student loans and it will lower the number of years to 20 from 25 that must pass before student loan debt can be forgiven. Loans can also be consolidated in new ways where the combined amounts of the loans will be tagged with lower interest rates.
The proposal drew roars from the “generation debt” crowd that packed the hall. Auraria is an urban campus that hosts students at several different colleges and universities and that attracts a large number of returning students — people who work their way through school and depend heavily on federal assistance to pay expenses.
Obama made the point that the reforms will affect not just hundreds of thousands of current students but also the millions of former students now well into their careers and adult lives but who still shell out to their student loan holders. The reforms could save individuals hundreds of dollars in loan payments each month.
The executive order is the sort of move bound to draw praise in homes throughout the country. Student loan debt in the United States has recently overtaken credit card debt. There is roughly $1 trillion in outstanding loans and this year’s crop of university graduates holds the highest average debt to date. Parents who aren’t themselves paying student loans are saving to pay the loans their children will soon carry.
“The very fact that you are here investing in your education, making an investment in your futures tells me you all share my faith in America’s future. You inspire me,” Obama said.
“We live in a global economy where businesses can set up shop anywhere there’s an internet connection. We live in a time where over the next decade 60 percent of new jobs will require more than a high school diploma.
“Other countries are hustling to out-educate us so they can out-compete us tomorrow. They want the jobs of the future. I want you to have those jobs. I want Americans to have those jobs. I want us to win the future. That means we should be doing everything we can to put a college education within reach for every American.
“It’s never been more important, but let’s face it, it’s also never been more expensive,” he said.
The middle-class connection
The president spoke informally about the debt he and his wife Michelle wracked up as students. He said together they owed well more than a hundred thousand dollars in student loans when they married.
“We combined liabilities, not assets,” he joked.
It was a life-reference that resonated especially well with the crowd and that suggested the difficulty an electoral opponent like son-of-privilege Mitt Romney, for example, would struggle to match.
Although the October snow and sleet piled up high on the roadways all around Denver, the standing-room-only crowd — mostly students and faculty — was fully energized, dancing in groups and shouting positive responses back to the opening band and to the president during his remarks.
Whether or not Obama will be able to energize youth voters more generally the way he did in record numbers in 2008 remains an open question, but it’s unlikely that any of Obama’s opponents could announce a speech like this one a week or so in advance and draw the numbers of young people who came out today and filled the event with rock-show vibrancy.
“It is great to be back in Colorado. It’s great to be here at CU Denver,” Obama said when he first stepped to the microphone. “I tend to have some pretty good memories of Denver. We had a little gathering here a few years ago at Mile High,” he said, jokingly referring to the 2008 Democratic National Convention, where he was chosen to be the party nominee for president.
“So coming here gets me fired up even when it’s snowing outside,” he said. “I don’t know where else you can go sledding on Halloween.”