Obama Urges More Investments In Infrastructure & Education (Weekly Address Video)

Weekly Address: Pushing Congress to Create Jobs, Keep College in Reach for Middle Class

President Obama discusses legislation he signed on Friday that does two important things: It keeps thousands of construction workers on the job rebuilding our crumbling infrastructure, and it stops interest rates on federal loans from doubling this year for more than seven million students.


Sources: White House.gov, Youtube

#Don'tDoubleMyRate! Obama Urges Congress To Act On Student Loans NOW!

You could owe an extra $1,000 unless Congress takes action soon.

Taking out Stafford Loans to help pay for college?

Interest rates on new subsidized loans are scheduled to double on July 1 and more than 7 million students around the country will rack up an average of $1,000 of extra debt each. Congress has the power to stop that from happening. Unfortunately, so far, Republicans in Congress have voted to let those rates go ahead and double in order to pay for tax cuts for millionaires and billionaires.

President Obama knows that’s not acceptable. Today, higher education isn’t a luxury – it’s a necessity that every American family should be able to afford. But it’s also getting more and more expensive.

For the first time ever, Americans owe more in student loans than in credit card debt. That’s why the President is calling on Congress to keep interest rates low so that every hardworking student gets a fair shot at the skills and training needed to get a good job in today's economy.


Sources: White House.gov, Twitter, Facebook, Youtube

Obama Urges Congress To Act NOW On Student Loans & Construction Jobs: Weekly Address

Congress Must Act on Transportation Bill and Student Loans

President Obama discusses the urgent need for Congress to act now on two common sense measures to help middle class families: preventing interest rates on federal student loans from going up and putting hundreds of thousands of construction workers back on the job.


Sources: White House.gov, Youtube

Young Voters: Obama & Romney Woo College Crowd Burdened With Debt; Decision 2012

Courting young voters in 2012 election

President Obama is counting on a lift-off in the economy to get re-elected. A poll out this week shows while most Americans have a gloomy view of current conditions, nearly 6 in 10 believe things will improve in the coming year.

These are especially tough times for new college graduates. And as CBS News' Terrell Brown tells us, jobs are sparse and young votes are up for grabs.

As they head home for the summer, the class of 2012 faces an uncertain future. For many, it's one filled with job searches and student loan payments.

"The uncertainty is scary," said Kevin Ward, who graduates from St. Anselm's College in New Hampshire this weekend. "It's the abyss. I'm jumping in the deep end."

He said this uncertainty will affect how he votes in November's presidential election: "The economy will really be on the top of my list, but also social issues are really up there."

Ward is one of the millennials -- 18-29-year-olds -- whose votes in 2008 helped President Obama take the White House.

"There were 2 million more youth voters than there had been in 2004," said Neil Levesque of the New Hampshire Political Institute. " I don't think that's going to happen again. Some of the shine has certainly diminished from the president."

Though a recent poll has President Obama with a sizable lead over Mitt Romney, Levesque thinks he could still be in trouble with the youth vote.

"Right now, he's up about 17 points with youth voters," said Levesque." But he's still only maxing out at a 43 percent rate within that demographic group."

Ward is not totally convinced. "It's different than it was before. I was younger, so I think I was easily influenced."

President Obama knows the youth vote is an important constituency. Mitt Romney's supporters are also pushing for the young vote.

"This time I'll be voting for Mitt Romney," said Justin Colella, who doesn't need a super PAC campaign to convince him to vote for Romney. "Mitt Romney possesses the qualities as well as the experience, both with business as well as politics."

And to emphasize how creating new jobs is the number one issue for young voters: Millennials say it's more important to them than health care or reducing the deficit.



Obama, Romney focus on student debt as campaign issue


President Obama and Republican rival Mitt Romney battled for the attention of young voters on Monday in hopes of capturing the enthusiasm they displayed four years ago that helped shape the arc of the presidential election.

Both candidates are homing in on concerns about mounting student debt as a key issue that could sway the college vote. Obama is making a full-court press this week to extend low rates on government-subsidized student loans through next year, with stops at universities in North Carolina, Colorado and Iowa over the next several days.

On Monday, Romney announced that he also supported the measure even though some Republican lawmakers have opposed it — marking one of the first significant policies on which the two can agree.

“I think young voters in this country have to vote for me if they’re really thinking of what’s in the best interest of the country and what’s in their personal best interest,” Romney said at a campaign event outside Philadelphia.

Obama won young voters by a wide margin four years ago, and they provided much of the grass-roots legwork that helped propel him to victory. They were more likely than older voters to attend a campaign event, and nearly one in 10 donated to a presidential candidate, according to Pew Research Center for the People and the Press.

“We think that he has the right vision and the right answers that are going appeal to those voters. The topic that we’ve been discussing today is a great example of why,” said James Kvaal, policy director for the Obama campaign.

However, a survey released last week by Georgetown University and the Public Religion Research Institute found that fewer than half of young voters say they are certain to show up at the polls this time. They rank jobs and unemployment as their most critical issue, according to the survey, with the federal deficit and education nearly tied for second place.

The debate over what to do about the nation’s $1 trillion in student loan debt speaks directly to all of those concerns. Many graduates have struggled to find jobs in the tight labor market — and have fallen behind on their college loans in the process. Another study by Pew found that those debts have made it harder for many young people to buy a home and have affected their career choices.

That has prompted rallies at college campuses across the country calling for an extension of low interest rates on federally subsidized Stafford loans. The rates were reduced to 3.4 percent in 2007 but will double on July 1 for new loans. According to the White House, about 7 million students would be affected, and the increase could cost them as much as $5,000 over the next decade.

Democratic lawmakers have proposed bills in both chambers that would extend the current rates through next year, but some Republicans have balked at the $6 billion price tag. On Monday, Sen. Tom Harkin
(D-Iowa), chairman of the education committee, said he would introduce new legislation on the issue later this week.

Romney’s support for the issue could help push it through the partisan gridlock on Capitol Hill. However, the candidate cautioned that the extension should be paid for in a way “that doesn’t harm the job prospects of young Americans.”

Still, the Obama campaign accused Romney of switching positions and supporting cuts to popular Pell Grants. And some Democratic lawmakers remained skeptical of Romney’s intentions.

“If they’re just going to say we’re for it, but not for paying for it any way that can pass and not for not paying for it, then it’s a game,” Sen. Charles E. Schumer (D-N.Y.) said. “But if they’re serious, we want to pass this.”

Harkin said that he opposed cutting other areas of education to pay for the extension but he had not yet identified another source of revenue.

Nevertheless, Romney’s comments fueled hope among consumer activists for the bill’s prospects.

“This should send a clear message to Congress that this is a common sense nonpartisan issue,” said Rich Williams, higher education advocate for U.S. PIRG.


Sources: AP, CBS News, PBS News, Russia Today, Washington Post, Youtube

Obama & Jimmy Fallon "Slow Jam" To Voters About Student Loan Debt

Sources: NBC, VH-1

Mitt Romney Loves For-Profit Colleges/ Student Loan Mill Scams! (Video)

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Sources: Youtube, Google Maps

College Affordability Linked To Federal Student Loan Reform? YES! Eliminating Student Loan Mills!

Mixed Reviews of Obama Plan to Keep Down College Costs

In a Campus visit Friday morning, President Obama outlined his plans to keep college tuition costs in check, getting a wildly enthusiastic response at the University of Michigan-Ann Arbor.

Students cheered his oratory on the importance of a college degree, expanded student aid, affordable college costs — and, of course, his many references to Michigan, a key swing state.

But out in the world, the reaction to the president’s proposals — tying colleges’ eligibility for certain federal aid programs to their affordability and outcomes — was far more tempered.

Most people stressed that they, too, wanted to make college education more affordable. But when it came to the particulars of the plan — and paying for it — there was no consensus.

“The idea of helping students and families pay for college is very popular,” said Terry W. Hartle, vice president of the American Council on Education. “On the other hand, nobody would bet on Congress passing much of anything this year, given the poisonous political atmosphere we are living in.

The problem is, many of the president’s ideas are fairly pricey.”

Briefing reporters on Friday afternoon, Department of Education officials said they would release information next month on how the plan could be financed, as part of the budget process.

Generally, in academia, there was strong support for the President’s plan to double work-study jobs and to expand the pool of money available for Perkins loans.

And some leaders, like Bill Powers, president of the University of Texas, liked the administration’s idea of tying aid to results.

“He’s proposing a form of performance funding for a portion of federal spending, and my view is that, whatever level of funding we’re talking about, that’s the approach we ought to take,” he said.

But others said they felt public higher education would suffer from tuition increases that were an inevitable result of state budget cuts. And while they appreciated the president’s advocacy for affordable higher education, many were wary of his plan.

“The answer is not going to come from more federal controls on colleges or states, or by telling families to judge the value of an education by the amount young graduates earn in the first few years after they graduate,” said David L. Warren, president of the National Association of Independent Colleges and Universities.

He warned of unintended consequences: If colleges are forced to cut corners, educational quality could decline.

In Congress, reaction to the plan seemed to divide along party lines.

“The president is saying that people can’t afford to go to college anymore, and that just simply is not true,” said Representative Virginia Foxx, the North Carolina Republican who is chairwoman of the House Higher Education subcommittee. “Tuition is too high at most schools, but it isn’t the job of the federal government to punish those schools. It’s very arbitrary, and the president sounds like a dictator.”

Senator Lamar Alexander of Tennessee, a Republican and a former federal secretary of education, offered his own ideas of improving academic efficiency: “I’ve suggested that they could offer three-year degrees to some students. Colleges could also operate more in the summertime, which would make more efficient use of campuses and reduce their costs.”

Many Democrats offered only the blandest of statements praising the president for tackling the affordability issue. “The president’s higher education proposal rightly calls on colleges, universities and states to maintain a commitment to keep college costs low making it easier for American families and their children to afford a college education,” Representative George Miller, Democrat of California, said in a statement.

Past efforts to rein in college costs have not fared well on Capitol Hill. Nine years ago, Representative Howard P. McKeon, a California Republican, proposed to cap colleges’ tuition increases at twice the rate of inflation, with sanctions including the loss of federal aid, but colleges protested, and the bill died in committee.

At the American Council on Education, there are concerns that Mr. Obama’s proposal to track outcomes by collecting information on graduates’ debt and earnings would harm institutions that train Head Start teachers and other important but low-paid professionals, while rewarding business schools.

Molly Corbett Broad, the council’s president, said many complex questions remained to be answered, among them, how affordability should be judged, and what the effect would be on public institutions that had had to raise tuition because of deep state funding cuts.

Furthermore, she said, even if the administration’s Race to the Top grant competition may have worked in leveraging change in K-12 schools, higher education is so different that it is not clear that the president’s proposal for a similar competition to spur state higher-education reform would be a good tool.

“The devil’s in the details,” she said. “And we don’t know the details yet.”


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Sources: NY Times, White House, Youtube, Google Maps

Solyndra Scandal Linked To Valerie Jarrett (Did She Rush DOE Loan Procedure?)

Solyndra: A Big Story for the Wrong Reasons

A bankrupt green energy company will create both real and political problems for President Obama today, as the U.S. House of Representatives continues its investigation into how Fremont, California-based Solyndra LLC used its access to the president and his inner circle in order to secure and lose half a billion taxpayer dollars.

Until last Thursday, the investigation into Solyndra had been coming only from the legislative branch of the federal government. In February, House Energy and Commerce Committee Chairman Fred Upton (R-Michigan ) opened a probe into a $535-million loan guarantee awarded to the maker of innovative solar panels by the Obama Department of Energy. That loan followed multiple visits to the White House by Solyndra officers and by George Kaiser, a Tulsa, Oklahoma billionaire and Obama fundraiser. Late in August Solyndra announced it would declare bankruptcy.

Last week, following a cycle of negative news coverage and revelations about the company’s close ties to the president, the executive branch response began with a raid on Solyndra’s headquarters by the Federal Bureau of Investigation and the Department of Energy’s Inspector General. News coverage highlighting DoE Inspector General Gregory Friedman’s hawkishness about insufficient due diligence in making lending decisions suggests the Obama Administration’s image management apparatus is making an effort to show the president takes the Solyndra scandal seriously.

Because of the depth and documentation of Obama’s relationship with Solyndra, as well as new House revelations that White House officials pressed the Energy Department to expedite its lending to the troubled company, the effort to distance him from the scandal will almost certainly fail.

Obama did a photo opp at Solyndra headquarters last year and has emphasized the company’s cylindrical solar panels in his propaganda for green energy subsidies. Kaiser, whose Argonaut Ventures owned a 35 percent stake in Solyndra, bundled nearly $100,000 for Obama’s 2008 campaign. Solyndra executives met with White House executives about 20 times. In the period before and just after the March 2009 loan guarantee (Solyndra eventually borrowed and blew through $527 million), Kaiser met with senior advisors Austan Goolsbee, Pete Rouse and Valerie Jarrett; chief of staff Rahm Emanuel, and others.

FBI and Energy both report to the president. While suspicion of overt crime could have triggered the executive-branch investigation, the involvement of these two departments clouds what had been a straightforward congressional investigation. In addition to the risk that Obama appointees can steer investigators away from evidence harmful to the president, the involvement of a competing presidential investigation detracts from what has so far been very effective work by the House.

Shortly after Solyndra announced its bankruptcy, I made the none-too-daring prediction that this scandal would prove to be durable. The figure of a half-billion dollars is easy to understand yet still incomprehensibly large. There is no distance between the president and the scandal. And the company name is memorably goofy enough that there’s no need to add the lame suffix “-gate.”

Ron Bailey remarked earlier that Solyndra is already getting shoehorned into Republocrat he-said-she-said. Although it would be a shame if this lesson in the folly of subsidizing industry degenerated into simple point-scoring, it’s also true that in this case it is because of competitive politics that we know about the scandal at all. Solyndra’s dim financial prospects, its dubious technology and its unlikely survival as anything other than a ward of the state were known before the loan was approved. (In a Business Insider article, Bruce Krasting says the company’s only valuable item may be its net operating loss.) Yet in the period after that loan, Solyndra continued to behave as a green-energy market leader, even attempting an initial public offering. Who knows how much longer the company could have gone on wasting public money, deluding investors and delaying formal bankruptcy, if not for Upton’s investigation?

It’s also clear that “contextualizing” the Solyndra scandal in the way Bailey regretted (by noting that Republicans do it too) only makes the story more infuriating. While Solyndra will be useful as a campaign issue, the real outrage is that the government is proudly putting your money into companies that private investors are unwilling to put their own money into. Once this violation of common sense has taken place, the story can only end, as it appears to have ended here, in suffering and crime. That’s not a corruption of the system. It’s the natural way the system works.




Solyndra's loans were rushed

Republican lawmakers, escalating the political furor over the collapse of a solar equipment manufacturer that received a $528 million government loan, released excerpts from Obama administration emails Wednesday suggesting that the White House pressed federal officials to wrap up their review of the loan quickly for political purposes.

In the emails, officials at the Office of Management and Budget expressed frustration that they were being put under time pressure to sign off on the loan to the company, Solyndra, two years ago so that Vice President Joe Biden could announce its approval at a groundbreaking for a factory.

The White House wanted an announcement that would show progress on job creation.

The disclosure became a focus of a House Energy and Commerce subcommittee hearing Wednesday about the loan to Solyndra, which has developed into a political headache for the Obama administration. The administration used the company as a prime example of stimulus-bill dollars creating "green jobs."

But Solyndra recently filed for bankruptcy protection and closed its factory, and its headquarters was raided by the Federal Bureau of Investigation, apparently in connection with the loan.

The bankruptcy filing and the raid "clearly show that the committee was more than justified in its scrutiny of the deal," said the panel's chairman, Rep. Fred Upton, R-Mich. "Why did the administration think Solyndra was such a good bet?"

Critics of the loan have focused on whether political considerations played a role in awarding the loan to Solyndra, which the Obama administration denies. But the hearing also cast doubt on the government's competence to assess how sure a bet it is making, regardless of politics.

Officials of the Energy Department's loan office and the White House budget office defended their decisions, which they said were carefully reviewed and not politically inspired. The administration said the emails showed only that the White House wanted to know when a decision would be made for its planning.

"As the emails indicate, there was interest in when a decision would be made because of its impact on whether an event involving the vice president could be scheduled for a particular date or not," said Eric Schultz, a White House spokesman. "But the loan-guarantee decision was merit-based and made by career staffers at the Department of Energy, and the process for this particular loan guarantee began under President George W. Bush."

Suspicions that the administration might have pushed the loan for political reasons have centered on the fact that a major investor in the company is a charitable foundation associated with George B. Kaiser, a billionaire from Tulsa, Okla., who raised $50,000 to $100,000 as a "bundler" for President Barack Obama's 2008 presidential campaign.

Logs show that Kaiser visited the White House on several occasions during the spring and summer of 2009, while the loan to Solyndra, based in Fremont, Calif., was being considered. Among the officials he met with were chief of staff Rahm Emanuel and Pete Rouse and Valerie Jarrett, both senior advisers to Obama.

"It seems like crony capitalism was trumping the smart decision-making," Rep. Steve Scalise, R-La., said at the hearing.

Campaign finance records analyzed by OpenSecrets.org show that there were about 235 other bundlers for the Obama campaign in Kaiser's range, while about 326 bundlers raised significantly larger sums.

Administration officials said the White House meetings were not about Solyndra but rather were related to Kaiser's charitable interest in policy matters such as early-childhood education. The George Kaiser Family Foundation has said that Kaiser "did not participate in any discussions with the U.S. government regarding the loan."

Three factors pushed the market price of solar arrays below Solyndra's cost of production, according to experts. The cost of silicon, a key ingredient in competitors' cells but not in Solyndra's, fell sharply. The economic crisis in Europe cut demand for solar cells. And China subsidized a huge increase of solar equipment production, producing a surplus.




Furor Over Loans to Failed Solar Firm

Republican lawmakers, escalating the political furor over the collapse of a solar equipment manufacturer that received a $528 million government loan, released excerpts from Obama administration e-mails on Wednesday suggesting that the White House pressed federal officials to wrap up their review of the loan quickly for political purposes.

In the e-mails, officials at the Office of Management and Budget expressed frustration that they were being put under time pressure to sign off on the loan to the company, Solyndra, two years ago so that Vice President Joseph R. Biden Jr. could announce its approval at a groundbreaking for a factory. The White House wanted an announcement that would show progress on job creation. The emails were first reported by the Washington Post and on the Web site of ABC News, in partnership with iWatch.

The disclosure became a focus of a House Energy and Commerce subcommittee hearing on Wednesday about the loan to Solyndra, which has developed into a political headache for the Obama administration. The administration used the company as a prime example of stimulus bill dollars creating “green jobs.” But Solyndra recently filed for bankruptcy protection and closed its factory, and its headquarters was raided by the Federal Bureau of Investigation, apparently in connection with the loan.

The bankruptcy filing and the raid “clearly show that the committee was more than justified in its scrutiny of the deal,” said the panel’s chairman, Representative Fred Upton, Republican of Michigan. “Why did the administration think Solyndra was such a good bet?”

Critics of the loan have focused on whether political considerations played a role in awarding the loan to Solyndra, which the Obama administration denies. But the hearing also cast doubt on the government’s competence to assess how sure a bet it is making, regardless of politics.

Officials of the Energy Department’s loan office and the White House budget office defended their decisions, which they said were carefully reviewed and not politically inspired. The administration said that the e-mails showed only that the White House wanted to know when a decision would be made for its planning.

“As the e-mails indicate, there was interest in when a decision would be made because of its impact on whether an event involving the vice president could be scheduled for a particular date or not,” said Eric Schultz, a White House spokesman. “But the loan guarantee decision was merit-based and made by career staffers at the Department of Energy, and the process for this particular loan guarantee began under President George W. Bush.”

Suspicions that the administration might have pushed the loan for political reasons have centered on the fact that a major investor in the company is a charitable foundation associated with George B. Kaiser, a billionaire from Tulsa, Okla., who raised $50,000 to $100,000 as a “bundler” for President Obama’s 2008 presidential campaign.

Logs show that Mr. Kaiser visited the White House on several occasions during the spring and summer of 2009, while the loan to Solyndra was being considered. Among the officials he met with were the chief of staff, Rahm Emanuel, and Pete Rouse and Valerie Jarrett, both senior advisers to Mr. Obama.

“It seems like crony capitalism was trumping the smart decision-making,” Representative Steve Scalise, Republican of Louisiana, said at the hearing.

Campaign finance records analyzed by OpenSecrets.org show that there were about 235 other bundlers for the Obama campaign in Mr. Kaiser’s range, while about 326 bundlers raised significantly larger sums.

Administration officials said the White House meetings were not about Solyndra but rather were related to Mr. Kaiser’s charitable interest in policy matters like early childhood education. Mr. Kaiser has declined to comment directly about the meetings. But the George Kaiser Family Foundation has said that “he did not participate in any discussions with the U.S. government regarding the loan.”

While Mr. Kaiser’s connection to the Obama campaign and to Solyndra, based in Fremont, Calif., have helped draw attention to the loan, he was not a major topic of discussion at the hearing on Wednesday. Republicans did, however, press those testifying on whether the Solyndra bankruptcy offered proof that the government should not be lending to companies that have trouble raising money from private investors.

“In this time of record debt, I question whether the government is qualified to act as a venture capitalist, picking winners and losers in speculative ventures and shelling out billions of taxpayer dollars to keep them afloat,” Mr. Upton said.

Three factors pushed the market price of solar arrays below Solyndra’s cost of production, according to experts. The cost of silicon, a key ingredient in competitors’ cells but not in Solyndra’s, fell sharply. The European economic crisis cut demand for solar cells. And China subsidized a huge increase of solar equipment production, producing a surplus.

While taxpayers could lose the $528 million the company borrowed from the Treasury, Jeffrey D. Zients, deputy director of the Office of Management and Budget, said that the system for evaluating such loans was sound. He said it was inevitable that some cutting-edge firms would fail but that over all, the investments would prove worthwhile. He did allow, “The lesson learned here is that marketplaces can change even more rapidly than one would have anticipated.”

Executives from Solyndra are scheduled to testify before the subcommittee next week.

Meanwhile, the White House provided about 900 pages of e-mails this week to the committee, which had asked for all correspondence between Obama aides and Solyndra executives. Most of the correspondence concerned logistics for a visit by Mr. Obama in the spring of 2010.

However, several e-mails from the company to the White House flagged and sought to discredit a handful of articles that had questioned the company’s financial viability as far back as July 2010. A Solyndra official, David Miller, called one such report baseless and noted that Solyndra “had no intention of going out of business” and that its goal was to be “a true success story for this administration to point to.”

Another Solyndra e-mail, from this past May, informed the White House that “things are going well” at the company and that it had “good market momentum, the factory is ramping up and our plan puts at cash positive later this year. Hopefully, we’ll have a great story to tell toward the end of the year.”

A White House official, Greg Nelson, replied: “Fantastic to hear that business is doing well — keep up the good work! We’re cheering for you.”



Solyndra "Scandal" Is Washington Business as Usual

I haven't written much about the California solar company Solyndra, which recently went bankrupt after receiving over $500 million in taxpayer money as part of the Department of Energy's program of loan guarantees for renewable energy companies. Short story: the sudden demise of the California-based company—which went out of business on Aug. 31, costing more than 1,000 employees their jobs—raised speculation that the Obama Administration may have channeled money toward Solyndra for political reasons.

Republicans in the House launched an investigation, and turned up emails that seemed to show White House staffers pushing officials at the Office of Management and Budget to sign off on the loans in time for a major public appearance by Vice-President Joe Biden at Solyndra's headquarters.

On Sept. 14 , a House subcommittee held hearings on the Solyndra affair, and Republican representatives tried to portray the Solyndra loans, and the White House's renewable energy support policy, as an expensive, politically motivated failure.

My response: meh. TIME's Michael Grunwald has covered this from the start, and while he's unhappy—to say the least—with executives at Solyndra for misleading the government on its financial health, the solar industry more broadly is doing well, thanks in part to the money the Obama Administration has channeled towards more successful companies. And it's worth noting that in addition to government loan guarantees, Solyndra also scored over $1 billion in private capital—including from GOP-friendly investors like the Walton family of Wal-Mart.

Solyndra turned out to be a bad investment—the company failed in part because it made the wrong bet on solar technology, failing to foresee that silicon prices would drop drastically.

Bad investments are a part of business, especially a cutting-edge industry like renewable energy, and failure is a necessary ingredient for innovation. (Just ask the famously fired Steve Jobs.) The idea that the collapse of one solar company discredits the entire solar industry is absurd.

Still, many Republicans would argue that the real question here is whether government policies like loan guarantees and subsidies can actually help support companies and create new jobs rather than simply engendering failure and waste. That's a fair debate to have. But the haters are being hypocritical.

Nosing for federal money and federal support is the name of the game in Washington—otherwise the expense accounts of lobbyists on K Street wouldn't be so generous.

Oil and gas and coal companies all spend millions in lobbying, putting former government regulators on their payrolls to ensure that policy goes their way.

House Speaker John Boehner himself has received more than $1.5 million from the coal industry—money that was spent well. It's not just Republicans—Democrats from oil or coal states know to look out for industry.

And it's not just the energy industry either—every major business sector is happy to lobby in Washington and bend legislation to their favor. That's the way things work—or don't, I suppose.

If Solyndra threw its weight around Washington to pull in that $500 million-plus loan guarantee, the firm was only copying its more entrenched competitors. In fact, maybe it was a sign that the renewable energy industry was finally ready for prime time. You can criticize the White House for spending public money foolishly in support of one of the President's signature policy objectives: building green jobs. But there's nothing here that makes the Solyndra debacle special. It's business as usual.


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Sources: Bloomberg TV, CNN, NY Times, Open Secrets, Reason.com, TIME, Twin Citizens.com, USA Today, Washington Post, Youtube, Google Maps

For-Proft College Student Loan Defaults Skyrocket! Scams! Cosmetology Schools Too!

Student Loan Defaults Reach Highest Level In More Than A Decade

Students at for-profit colleges are more than twice as likely to default on federal loans as their peers at public institutions, according to new data released Monday by the Department of Education that also shows the highest percentage of students defaulting on loans in more than a decade.

The overall student loan default rate increased from 7 percent last year to 8.8 percent -- the highest rate since the government released similar data in 1999. An outsized share of that increase came from the for-profit college sector, which had both the highest percentage of defaults and the greatest increase in defaults, compared to public universities and private nonprofit schools.

Defaults at for-profit schools jumped from 11.6 percent to 15 percent this year, as opposed to an increase of 6 percent to 7.2 percent at public institutions and 4 percent to 4.6 percent at private nonprofit schools, raising questions about the degree to which for-profit schools are preparing students for careers that will allow them to pay off debts.

Because the government must track loan repayment over two years, Monday's data represents the first full assessment of students' ability to repay college loans in the Great Recession. And the numbers were bleak: the overall student loan default rate increased at the highest rate in two decades.

"We do think the economy is a big factor in the growth of these student loan default rates," said James Kvaal, a deputy undersecretary of education. "Another trend worth highlighting is the growth in for-profit colleges. Many of those colleges offer excellent, innovative programs, but we do also see disproportionate default rates among students who are enrolled in those programs."

For-profit colleges have been conspicuous beneficiaries of the economic downturn, as many of the publicly traded corporations that own such institutions expanded enrollments rapidly as legions of unemployed Americans looked to college as a way to improve their fortunes.

The high number of student loan defaults at for-profit institutions has prompted heightened government scrutiny in recent years, amid evidence that some schools aggressively market their programs to students but fail to deliver on the promise of careers. For-profit schools typically cost nearly twice as much as public colleges and universities, and students on average graduate with much higher student loan debt.

Because of the high costs, students at for-profit colleges borrow at much higher rates than those who attend public or private nonprofit schools. According to an analysis of federal education data by The Institute for College Access and Success, 92 percent of students at for-profit colleges took out student loans in the 2007-'08 school year, compared to 27 percent of students at public colleges and 60 percent at private nonprofit colleges.

For-profit colleges have also aggressively targeted minority students. Black and Hispanic students make up 28 percent of undergraduate students nationwide, but they represent nearly half of all students in the for-profit college sector.

"When you see 15 percent of borrowers at for-profit colleges are defaulting, its important to remember that almost all students at those colleges are borrowing, so that shows a much more significant problem in that one sector," said Debbie Cochrane, program director at the Institute of College Access and Success.

Nearly half of all student loan defaults measured by the Department of Education could be attributed to students at for-profit colleges, even though students at such schools represent less than 28 percent of all borrowers.

The federal government measures student loan default rates as a way to gauge student success, and to determine whether certain schools should be eligible to receive federal student aid dollars.

Student loan debt is among the most difficult to discharge, persisting beyond even bankruptcy. Borrowers in default on student loans can be subject to wage garnishment as well as deductions from federal income tax refunds, and they are ineligible to receive federal student aid in the future.

"What is really sad about this is that most of these people are done -- this is their last chance, because they have now defaulted," said Anthony Carnevale, director of Georgetown University’s Center on Education and the Workforce. "That will follow them to their grave. You can default on your house, but you can’t default on a student loan."

The Department of Education data released Monday is a snapshot of students over two years: the government tracked those who began repaying loans between October 2008 and September 2009, and measured whether they defaulted on those loans before October 2010. A loan is considered in default if no payment has been made after 360 days.

In a statement, Brian Moran, the head of the Association of Private Sector Colleges and Universities, which represents for-profit colleges, said he was "disappointed" to see the data but noted, "we believe that the default rates will go down when the economy improves and the unemployment rate drops."

"Despite today's disappointing news, we should remain focused on the overarching missions, which is to help individuals rise as high as their talent, ability and ambition will take them," Moran’s statement read.

Under current regulations, schools that have student loan default rates in excess of 25 percent for three consecutive years can face sanctions or lose access to federal student lending programs. Five schools were subject to sanctions this year, four of which were for-profit schools.

Beginning in 2014, the Department of Education will start to analyze student loan default rates over three years, as opposed to the current two-year window. Data from the Department of Education shows that many more students default in the third year after entering loan repayment. And some schools have actively managed their default rates by putting students into loan deferment or forbearance plans that prevent defaulting within the two-year window, but do little beyond that timeframe.

"That’s a good thing if that helps those students manage their student loan responsibilities, but in some cases it may serve just to delay the default and increase the amount of the loan," said Kvaal, the deputy undersecretary of education.


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Sources: ABC News, Huffington Post, Youtube, Google Maps

For-Profit Colleges Vs. Obama: Student Loan Jackpot!

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Its About Time Pres. Obama & Congress Has Decided To Crack Down On Corrupt, Greedy For-Profit Colleges.

i.e., Student Loan Mills!

Most For-Profit Schools (NOT ALL) Are Nothing More Than Fake Institutions Of Learning, Established ONLY For The Sole Purpose Of Fattening Pockets Of Company Investors.

Like Predatory Lenders During The Housing Boom, Most For-Profit Schools (Not All) Target Low Income Black & Hispanic Students Sincerely Seeking To Earn College Degrees Or Trade School Diplomas But Can't Afford To Attend Traditional Colleges.

Such Lying, Fake Institutions Of Learning Often Hold Classes In Raggedy, Unsafe Buildings, Lack Proper/ Necessary Materials, Hire Poorly Trained, Unqualified Staff & Due To Providing Very Little Support To Students Have Very HIGH Drop-Out Rates!

In Other Words The Crooks Running Those Schools Could Actually Care Less If The Students Complete The Programs Or Not!

Just As Long As Students Sign On The Dotted Line Allowing Those Schools To Get Federal Student Loan Funding, It Doesn't Matter To Administrators If Students Graduate!

If The Students Don't Graduate Who Is STILL Responsible For Repaying Those Federal Student Loans Back To The Government?

That's Right!

THE STUDENTS!

So Yes!

I'm Happy To See Pres. Obama & Congress Begin To Crack Down On Crooked For-Profit Schools Which Prey On Low Income Black & Hispanic Students Sincerely Seeking An Education In This Country.

In Fact I Would Love Them Put Out Of Business!!

VOTE OBAMA IN 2012!






NEW FOR-PROFIT COLLEGES PERFORMANCE REQUIREMENTS TO RECEIVE FEDERAL STUDENT AID:

TO PROVIDE ADDITIONAL PROTECTION, FOR-PROFIT PROGRAMS MUST PASS AT LEAST ONE OF THE THREE METRICS TO REMAIN ELIGIBLE FOR FEDERAL STUDENT AID FUNDING:

1) Repayment Rate:
At Least 35% Of Former Students Must Repay Their Loans.

2) Debt-To-Discretionary Income Ratio:
The Annual Student Loan Payment Does Not Exceed 30% Of Typical Graduates' Discretionary Income.

3) Debt-To-Total Earnings:
The Annual Student Loan Payment Does Not Exceed 12% Of Typical Graduates' Total Income.

IF A PROGRAM FAILS ALL THREE METRICS:

1) After One Failure:
The Institution Must Disclose The Amount By Which The Program Missed Minimal Acceptable Performance & Establish A 3-Day Waiting Period Before Students Can Enroll.

2) After Two Failures Within Three Years:
The Institution Must Tell Students In The Failing Program That Their Debts May Be Unaffordable, The Program May Lose Eligibility & What Transfer Options Exist For Them>

3) After Three Failures Within Four Years:
The Program Loses Eligibility For Federal Student Aid. Institutions Can NOT Re-establish The Program's Eligibility For At Least Three Years. However, The Programs CAN Continue To Operate Without Receiving Federal Student Aid.

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For-Profit College Regulations: Obama Administration Issues Rules

The Obama administration on Thursday issued a series of highly anticipated regulations aimed at cracking down on for-profit colleges and other career training programs that leave students saddled with unmanageable debts and contribute to an unequal share of federal student loan defaults.

The final rules issued by the Department of Education, however, are significantly less stringent than a draft version released last year, giving college programs an additional three years to come in line before possibly losing access to lucrative federal student aid dollars. The changes come after an unprecedented lobbying and campaign finance offensive over the past year by the for-profit college industry, which derives a vast majority of revenues from federal student loan and grant programs and has sought to protect that income by gaining influence in Washington.

Education Secretary Arne Duncan said the changes came after discussion with "lots and lots of different folks," not just the industry, and he pointed out that the colleges were not unanimous in their suggestions for changes.

"What we really wanted to do was give people a chance to reform ... this was not about 'gotcha,'" Duncan said. "We tried to be very thoughtful, very reasonable and give people every opportunity to succeed, but be very clear where we wouldn't permit ongoing failure."

The rules have been in the making for nearly two years, amid evidence that students at for-profit institutions default on federal loans at a significantly higher rate and pay higher tuition than their counterparts at public universities, despite for-profit schools devoting significantly less money toward instruction.

The rules were derived as a way to bring accountability to the federal student aid system and to protect students from unscrupulous programs that sought only their federally subsidized tuition.

"The for-profit education sector business model invokes much of the same characteristics of what happened with subprime housing and securitization, namely that the schools can capture all of the upside of increased volume while shifting all of the downside risk somewhere else," said Gene Sperling, director of the National Economic Council. "In this case, that somewhere else is to students and taxpayers."

Specifically, the rules will measure student outcomes at such programs in two ways: whether students repay at least a portion of their student loans and whether a graduate has an excessive debt burden compared to his or her income.

In order to be disqualified from the student loan program, more than 65 percent of students would have to be delinquent in repaying their loans, and graduates would need to have loan debts that comprise more than 30 percent of their discretionary income, or more than 12 percent of their total earnings.

A program would have to fail each of those three metrics in three out of four years in order to completely lose eligibility for federal student aid, as opposed to potentially losing eligibility after one year under the draft rules from last year.

That means programs cannot be disqualified from receiving federal student aid until 2015, as opposed to 2012 under the draft rules.

Groups that have criticized for-profit colleges expressed disappointment that the rules did not go far enough in protecting students from harmful programs, but said the reform will still address some of the worst abuses in the industry.

"I think it means that more bad programs that don't serve students well will continue, but that many bad programs will be put out of business, or be forced to reform," said David Halperin, a senior vice president at the Center for American Progress who directs the group's Campus Progress arm. "It would have been better if the rule was stronger or kicked in sooner, but nevertheless I think over time, hundreds of thousands if not millions of students will be protected because this rule was issued."

Sen. Tom Harkin (D-Iowa), who has led a series of hearings probing abuses in the industry, called the regulations "a modest and important first step to protect students and taxpayers from subprime academic programs that have a demonstrated track record of failure."

Groups representing the for-profit college industry largely reserved judgment on the rule. Harris Miller, president and chief executive of the Association of Private Sector Colleges and Universities, said it appeared that the Department of Education listened to concerns they had raised.

But he said his group will bring on a third-party researcher to study the potential effects of the rule on students. Miller's group has sued the Department of Education over a series of other for-profit regulations relating to compensation of recruiters and misrepresentation of a program's benefits.

"The bottom line is not whether the department makes changes or not, but what are the impacts of those changes to student access to higher education?" Miller said.

He did not say whether the group would file a lawsuit over this set of regulations.

Lanny Davis, a former special counsel to President Clinton who has lobbied against the regulations for for-profit colleges, noted that "there appears to have been some second thoughts" by the administration. Davis now lobbies for the National Black Chamber of Commerce, which has argued that the rules would restrict access to minority students who attend such institutions in greater numbers than in other sectors of higher education.

"We hope we can continue to see some changes in what is essentially a targeted regulation that has a disparate impact on low-income and vulnerable students," Davis said.

For-profit schools and their lobbying groups engaged in a vicious fight over the past year, accusing the Department of Education of coming up with the rules as part of a conspiracy with Wall Street short sellers, based on e-mails and a handful of meetings where Department officials viewed presentations. The Department of Education's Inspector General disclosed at a hearing in March that she is investigating any potential improper communications, after Sens. Tom Coburn (R-Okla.) and Richard Burr (R-N.C.) brought up the matter last fall.

The industry also publicly attacked the Government Accountability Office, Congress' investigative arm, over a series of corrections made to an undercover report that found widespread abuse and deception among recruiters at for-profit schools. The industry spent more than $8.1 million on lobbying in 2010, more than doubling spending of $3.3 million from the year before.

In addition to increased government regulation, the industry is facing a joint probe by attorneys general in at least 10 states, and the Justice Department has intervened in a lawsuit filed against Education Management Corp., a Pittsburgh corporation that owns numerous colleges across the country.

The original draft of the rules would have restricted growth at certain programs that failed loan repayment and debt burden measurements. The rules released Thursday require schools that fail to meet all standards to provide disclosures to students.

For example, although it takes three years of failure for a program to be ineligible for student loans, after one year of failure a school must tell students how the program failed to meet the regulation. And the school is required to give students a three-day waiting period before they are able to enroll.

After two years of failing to meet standards, a school must warn students that they may be unable to afford their debts and explain transfer options.

The regulations apply to individual degree programs, not entire schools. Although the rules are expected to have the most impact on for-profit colleges, there are more than three times as many public and non-profit vocational programs also subject to the new regulations.


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Sources: CBS News, Huffington Post, MSNBC, Youtube, Google Maps

Grameen Bank Microloans: Job Creator & Pathway Out Of Poverty

Lending Plan Won Prize, But Will It Work Here?


The maroon couch was big enough to take up half the living room, but by the time the 10th woman arrived it could hold no more.

The room temperature was rising from all the body heat. Chairs were brought in from the kitchen. Even the floor was called into service.

“I’d like to start the collection,” Alethia Mendez announced after the last of the 15 women had arrived on a recent Saturday morning.

Therese Prentice counted out crisp bills, divided them, tucked them in envelopes and recorded the amount in a flimsy green book. The next woman repeated the exercise, until all 15 had made their payments for the week.

Then the money was handed to Ms. Mendez, the group’s 24-year-old banker.

“This is the way it was done in Bangladesh, so we do the same thing here,” Ms. Prentice said. “It’s our ritual.”

The women are clients of Grameen Bank, the international organization that pioneered “microloans” to third-world entrepreneurs and that, along with its founder, won the Nobel Peace Prize in 2006.

But the women were not in one of the abjectly poor villages in Bangladesh where Grameen usually does business; they were in a modest two-story brick house in St. Albans, Queens.

Since the beginning of January, 11 Grameen lending groups have sprung up throughout Queens in the bank’s first venture in the United States. They have lent more than $250,000, in amounts ranging from $500 to $3,000, to more than 100 women for income-generating activity like elder care, housecleaning and flower-arranging businesses.

“Of the entire U.S. population, 40 percent is underbanked, and as a result end up using payday lenders, check cashers and other, more expensive services,” said Vidar Jorgensen, president of Grameen America. “We’re here to meet this huge need.”

If the program works well, Grameen intends to expand nationwide. But while it has flourished elsewhere, it is not clear whether Grameen’s model — which relies on peer pressure rather than collateral to make sure women repay their debts — will work here, and whether such small loans can actually help lift its borrowers out of poverty.

“In parts of the United States it may very well work, but I have real doubts about it working in places like New York City,” said David R. Jones, president and chief executive officer of the Community Service Society of New York.

His group gives cash grants averaging $3,000 to city residents in financial distress — for instance, to people who have fallen behind on their rent or who cannot pay their medical bills. But Mr. Jones said that $3,000 is generally not enough to stabilize a New York resident.

Still, Grameen’s experiment here is being closely watched. Elaine L. Edgcomb of the Aspen Institute in Washington, who co-wrote a 2005 study of more than 100 microlending programs in the United States, said that borrowers do “move out of poverty, and the business can be an important contributor to that, but it’s not always the only contributor.”

“For many families, the increase in income is sufficient to take them above the poverty line,” she said.

Grameen’s distinguishing feature is its mandatory weekly meetings at which borrowers learn money management skills from their banker and from one another and must make their payments in front of everyone else in the group. If one person defaults on a loan, Grameen will not call a lawyer or a collection agency or confiscate any assets. Instead, no one in the group will be eligible for a new loan.

“You have 30 eyeballs who are looking at you and making you accountable,” said Myriam Pericles, a 41-year-old first-generation Haitian-American, who will use her $3,000 loan to expand her computer consulting business. She was a little skeptical about the process. “Maybe all this works in Bangladesh, but this is America, where people are different — our value system gets warped, our word is not our bond.”

Nicole Brown, 30, who immigrated from Jamaica as a child, is using her $2,000 loan to start a day care business. “I didn’t have it in my head to start my own business, but if you want to be great in life, you have to have your own stuff,” she said. She added that she was drawn to Grameen through her sister, Wendy Brown, who is using her $3,000 loan to expand her apartment-cleaning business, Meticulous Cleaning Service L.L.C.

As the other group members looked on, Wendy Brown, 36, made her first payment on the $3,000 loan: $60 toward principal, $6 for interest and $2 toward a savings account. If she makes all her payments, she will retire the debt within a year and be eligible for another loan. “It’s very simple, as opposed to getting it through a normal bank and going through the red tape and getting denied,” she said.

Grameen America’s managers, who are based in Jackson Heights, say that all the women in Queens are paying back their loans on time. But adapting its model to the United States has not been easy.

While Grameen officially requires a home visit to verify that borrowers are truly poor — they must fall below the United States Census Bureau’s poverty line, currently defined as $21,027 for a four-person household with two children — some borrowers at the St. Albans meeting still had not received a visit. Grameen organizers said last week that all borrowers would receive home visits in the next few weeks.

Finding potential borrowers has been another challenge.

“Here, the women are not working in the community where they are living,” said Shah Newaz, the general manager of the Jackson Heights office, who has worked with Grameen for 26 years all over the world. It is hard to meet with the women “because they are not in their houses in the daytime, and in the evening they are very tired and preparing meals, taking care of children and getting ready for the next day.”

Grameen aims its loans at women, saying it has found them more responsible than men and more comfortable with the group model. So far, the Queens operation has lent only to women.

But the organization says it will lend to men here, and is aware that it cannot discriminate on the basis of gender. “We want a female candidate, but in the U.S. you can’t say that in advertisements,” Mr. Newaz said. “That is a problem.”

The idea behind Grameen Bank began in Bangladesh in 1976, when Muhammad Yunus, an economics professor, lent a total of $27 to a group of 42 women in Jobra, a southern village. All of the women repaid their loans. Since 1983, when Mr. Yunus formally founded Grameen, it has lent $6.8 billion to 7.4 million Bangladeshis; 97 percent of its borrowers are women.

Mr. Yunus tried to start a microlending program in the United States in 1985, when he was invited to rural southern Arkansas by Bill Clinton, who was then the governor. But the program Mr. Yunus helped start, called the Good Faith Fund, failed. The group lending model never caught on. If given the choice, “any human being on earth would want to borrow as an individual rather than as a group member. It didn’t work very well in this country,” explained Mary Houghton, founder of ShoreBank, who helped advise the Arkansas experiment.

Another microfinance organization, Acción USA, which has lent money to more than 20,000 people since 1991, also attempted the group lending model in its early days. “We found that the group methodology did not work well because there was a general lack of trust among potential borrowers and an unwillingness to guarantee another person’s loan,” said Bill Burrus, president and chief executive of Acción USA. The organization has since adopted a more traditional individual lending model in almost all cases, and its default rate has ranged from 4 to 7 percent in recent years. Grameen says its default rate in Bangladesh was less than 1 percent, though higher in times of flooding.

Grameen America is aiming to reach 21,000 borrowers within five years, the number that its organizers say would allow it to break even. To improve its chances of success, it relies upon dense social networks, the kind often found in immigrant communities, to help form its groups of borrowers. The center in St. Albans consists predominantly of Caribbean and African-American women.

Not long ago, they would wait out winter afternoons between cleaning jobs on subway platforms, unable to afford lunch or dinner.

“We’d starve until we got home,” Nicole Brown said. The sisters, who had moved back in with their mother, did not want to ask for more help from her, so they turned to Grameen.

“Last year, I had $3 in my pocket,” Wendy Brown said. “This loan could help be the turning point.”


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Sources: Grameen Bank, NY Times, Youtube, Google Maps