Anyhoo, this Forbes Article offers a primer of his proposed solution:
The president's plan would cap payments on federal loans at 10% of a borrower's income for those earning above $33,075 (which is 150% of minimum wage). Under the president's plan someone who earns less than $33,075 would owe nothing on a monthly basis. Those with higher incomes would have monthly student loan payments that equal 10% of their income above $33,075. The plan also allows loans to be forgiven after 20 years instead of 25.
So, this is great news for the plethora of unemployed attorneys who are earning $0 a year. This is also great news for the poor attorneys that have managed to snag "experience traps," a.k.a. associate type positions earning $30K that claim to be a good experience.
The bad news, of course, is that you will be paying the mounting principal and interest one day. In our beautiful Capitalist model, banks don't take risks and they never lose. Remember that!
By the way, the plan does not apply to private loans. So, since most law students have maxed out on federal loans at the undergrad level, I'm not sure how much that will help my readers. Maybe this will help reinforce that private loans are to be avoided like the plague--as if you didn't know.
So, in conclusion, I'm happy if he manages to get this passed. However, I will never be satisfied until private loans are dischargeable in bankruptcy. To have it any other way is a testament to our government's bow to big business.
Thanks Obama! I realize that the New World Order owns you, but just try a little harder.