¶ … Federal Student Tuition Loan Limits Current federal student loan limits make it difficult for many students to pursue the educational program of their choice. Therefore, student loan limits must be raised.

Despite financial aid and federal loans, a college education remains beyond the reach of many Americans.

Illustration of problem - Many colleges fix their loans at levels very low levels, without taking into account the effects of inflation.

Individual level - Many students, particularly those from out of state, cannot afford college even in public and state colleges.

Society level - Many students drop out of programs such as education, in order to go into more "highly paying" majors such as business.

Pointing - By decreasing the number of younger people who go to college or into field such as social work and education, society loses valuable human resources.

Satisfaction - Federal student loan limits must be increased.

Action

We should join coalitions calling for increasing federal student loan limits.

We should campaign Congressional representatives about the need to increase student loan limits.

University of Kansas freshman Anne Iverson was initially attracted to the school for its social welfare program. However, because she is from Iowa, Iverson had to pay out of school tuition rates. Iverson, who is paying her own way through college, soon ran into difficulty when the freshman federal loan limit of $2,625 was inadequate to pay for the tuition and living expenses of her first year.

Unless federal student loan levels are increased, Iverson will have to choose between dropping out of school or borrowing from banks and becoming mired in debt.

Calls for increases in federal student loan limits were formerly limited to private colleges, which had more expensive tuition fees in the first place. However, even students at state and public colleges are running into the same problem. The costs of a college education have far outpaced the rise in student loan limits.

This speech argues that federal student loans need to be increased, in order to keep a college education within the reach of students. In the first part, this paper discusses the limits of loan programs like the Stafford Loans and Pell Grants, in comparison to the cost of a college education today. The next part then argues that this discrepancy leads to many people dropping out of college. Others leave socially-oriented occupations like education and social welfare.

The drop-out rate and the loss of potential educators and social workers are then a significant loss to society as a whole.

Because of these factors, this speech calls on all Americans to join in the coalition to increase federal student grant limits.

This will help to ensure that a college education is a right that remains available to all Americans, regardless of financial status.

Body

Students around the country are experiencing Iverson's problem. Currently, various federal loan programs place their maximum allowable student loans at very low limits. Currently, student loans are limited to $2,625 for the first year and rises to $5,500 by senior year. There is a limit $22,625 over an undergraduate education. These limits were set more than a decade ago, and understandably lag behind the current tuition and college living expenses.

Similarly, Kendra Buscho recalls how inadequate the $2,625 freshman limit was for taking care of school-related expenses. Books alone, said Buscho, could cost up to $1,500 depending on the subjects.

In fact, limits on the Federal Stafford Loans have not changed since 1992. Furthermore, the freshman loan limits have not been increased since 1972. Students are also being charged hidden loans like the "origination fee," which adds to the loan burden of those who avail of the subsidized Stafford loans.

To pay for their education, many students have to take additional jobs in order to augment the inadequate federal loans. This is particularly true for students who are working and paying their own way through college.

Many of those who have to work longer hours or...

Others are turning to private loans, which have higher interest rates and more restrictive payback conditions.
At the relatively small Northwest Missouri State University, for example, 250 out of 6,000 students have already taken private loans after having exceeded the federal loan limit. Heather Schmidt, for example, has already been forced to take out $15,000 in private loans from the Sallie Mae foundation to help pay for her college tuition and her living expenses. She states that if the overall federal loan limit was increased, "then maybe more people would actually go to college, stay for four years, get their degrees, and not have to worry so much about their economic problems." This number will surely increase, as the costs of education continue to go up.

Unless the federal student loan limits are increased to reflect the real expenses of colleges today, students like Heather Schmidt, Kendra Buscho and Anne Iverson will continue to suffer.

In many ways, however, Heather, Anne and Kendra are the lucky ones. They are still in school, pursuing the degree of their choice. A number of their peers, in contrast, have been forced to leave.

Many colleges are already seeing higher drop-out rates among its freshman population. The low limits of federal student loans, particularly for first year students, could be partly to blame for this problem.

Current freshman students are also far more likely to default on their student loans.

The demographic data on students taking loans shows that most of the students who go beyond the limit of federal loans are also those who are struggling the most to get through college. Many belong to racial and ethnic groups that are underrepresented in higher education. Furthermore, many of these students are the first in their families to go to college.

A failure to raise current federal student loan limits thus does a great disservice to these citizens. After all, even those who are not rich are entitled to college education just as much as more affluent members of society.

A refusal to raise the Stafford and other federal loan limits is tantamount to keeping higher education the purview of the elite.

In addition to keeping education from low-income and working-class students, the current federal student loan limits also has long-term detrimental effects on the rest of society. Kelly Pierson, for example, initially went to the Northwest Missouri State University to attend the school's prestigious education program. Pierson, who had wanted to be an elementary school teacher since high school, shocked her family when she dropped out of the education program in her junior year to study business. Pierson stated that she still wanted to be a teacher, but eventually chose business due to financial reasons. She realized that being a teacher in a small rural town would make it a constant struggle to pay off her $20,000 post-graduation student debt.

Examples like Pierson's case illustrate how failing to make education more accessible has high social costs as well. Already, public schools point to the growing class sizes and the dearth of qualified teachers.

This has significant implications for the future of the economy, which depends a lot on ensuring that the next generation of Americans is skilled and educated.

To help alleviate the financial costs of a college education, several groups have made several proposals. These include longer and more lenient payment periods. In this case, the American Council on Education suggests an extended repayment plan, instead of forcing graduates to repay all their loans within a 10-year period.

The Council also additionally recommends the creation of a $1 billion emergency fund for students who choose to enter "lower-paying, high need career fields" such as education in low-income areas.

The Coalition for Better Student Loans also recommends the abolishment of the origination fee. In addition, the Coalition calls for the freshman student loans to start at $4,000. Down the road, the coalition would like to increase the freshman limit to $10,000.

Surveys show that more than 90% of college students…