Friday, April 26, 2013

Ripple Effects Of The Sequestration

As we all know that the law that triggered the ongoing Sequestration was passed by US Congress and signed by US President back in 2011 during the end of the year Grand Bargaining. Many of us and the media have put the focus of the ripple effects mainly on the Defense and recently FAA. But this very bad piece of legislation, as we know it, is bad for everything and every aspect of human life to all Americans.  For example, l just received this email from the Department of Education stating the following:

“Dear ………(student name), Our records indicate that you either recently received or are scheduled to receive a Direct Loan from the U.S. Department of Education to help meet your educational expenses. We want to bring to your attention some recent changes in the law that will affect your Direct Subsidized and/or Direct Unsubsidized Loan.

On August 2, 2011, Congress passed the Budget Control Act of 2011, which put into place automatic federal budget cuts, known as the "sequester." While this law does not otherwise change the amount or terms or conditions of your Direct Loan, it does increase loan fees on Direct Subsidized and Direct Unsubsidized Loans first disbursed after March 1, 2013. Specifically, the fee on your loan will increase from 1.0 percent of your loan amount to 1.051 percent. For example, the fee on a $5,500 loan will increase by $2.80 from $55.00 to $57.80.

If you accept the loan that has been or will be disbursed for you, you will be agreeing to this higher fee and there is nothing you need to do at this time. However, if you wish to cancel or reduce your loan, you may do so by contacting your school's financial aid office. Requests for cancellation should be made as soon as possible. If you have additional questions about your loan, please do not hesitate to contact your school's financial aid office.
We wish you good luck in your educational pursuits. Sincerely, U.S. Department of Education”

All it says is that US Congress raised taxes to the students in the form of paying higher interests during repayment. If you pay attention what politicians says, during campaigns (Very often)  and on the Congress floors as they are legislating (not often at all), you will notice that they discussed H.R. 4170 (112th): Student Loan Forgiveness Act of 2012 but did not pass.

Since there are not lobbyists for students and parents who can go give legislatures legalized bribes imposed by themselves like financial industries, pharmaceuticals, energy, contractors and so on, families are left to fend for themselves on this one. All I can say is ‘Go Figure!”

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