Shankland, Dems Repeat Call To Allow Student Loan Refinancing
By Larry Lee, WSAU Radio
MADISON, Wis. (WSAU) -- Last week, Governor Scott Walker signed new laws designed to reduce college debt and get students into the workforce more quickly. Supporters say the new laws are a good step in the right direction. Governor Walker said, “The best way to keep student debt down is to not borrow it in the first place.” Opponents, including most Democrats, criticize Walker because that doesn't help the students who have dug themselves a large financial hole already.
The new laws signed last Monday include the creation of a student loan debt specialist position in the state Department of Financial Institutions, additional coordination between education institutions for more internships, additional Department of Workforce Development Fast Forward worker training dollars for internships, and over $320,000 dollars towards emergency grants for students already in college but in danger of not finishing their programs because of financial hardships.
Assistant Assembly Minority Leader Katrina Shankland of Stevens Point repeated their party's call for more student aid and changes to the law so students and families could refinance student loan debt. "Republicans have voted against it or tabled it, and said that it won't help, but what we do know is the vast majority of the people of Wisconsin support refinancing, and we also know it will save every person who has student loan debt up to hundreds of dollars a year, both on their taxes and by refinancing."
The regulation that prevents student loans from being refinanced is a federal regulation, but Shankland says the states have the right to legislate this change, like Minnesota and Connecticut have done. "There is also a bill in Congress that would accomplish the same thing. It would allow for refinancing, and I think that's a great place to start, but I also know that states are innovation labs, and that it's state's rights to create legislation that benefits the people."
Shankland says if we have legislators that are working for the people, they should be working on simple, market based changes like allowing refinancing of student debt.
The Stevens Point Democrat says young people often can't contribute more to the growth of the economy because their income is going towards loan payments. "Whether it's starting a business, buying a new car or house, starting a family, these things are crucial to the economy, and they stimulate the economy when you make these financial decisions, but if you have an average of $28,000 in student loan debt, you can't do that."
Shankland says she doesn't understand why the majority party has not supported this one, market-based solution at the federal or state level that would help thousands of families reduce student loan debt.