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Monthly Archives: July 2016

Education

‘I’m A Student-Debt Slave.’ How’d We Get Here?

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Most everyone knows someone adversely affected by student debt: More than 40 million Americans are shouldering a crippling $1.3 trillion in loans.

That burden is obstructing careers, families, dreams, employment and even retirement.

Uncle Sam and Wall Street have made lots of money off the crisis.

We’ve covered this issue in many ways, including the debates, the players, tips for easing debt, how debt is affecting young people’s decision making and a lot more.

But how did we get here? Who has profited most and how?

The Center for Investigative Reporting and its weekly radio show Reveal recently dug deep into these questions and profiled people who’ve been affected. I reached out to CIR reporter Lance Williams, who co-investigated the story with journalist James B. Steel. Here’s an excerpt of our conversation.

Let’s talk about the student lending giant Sallie Mae. You report how the decision to privatize Sallie Mae in 1997 played a huge role in helping to create this debt crisis. Explain.

Sallie Mae was a government-affiliated corporation whose board was made up in part of public officials. When it first came into existence, it was supposed to help create a market for the student debt that the feds were issuing. But after privatization, it became a full-service, for-profit corporation that really “verticalized” its involvement in the student debt industry, everything from issuing loans to running collection bureaus. The concern now is we replaced a program whose real purpose was to help people go to college with something where that’s kind of a secondary goal. The primary goal, of course, for for-profit institutions is the bottom line.

Privatization of Sallie Mae was a key victory for banking and financial industry lobbyists when the Republicans controlled Congress in the mid-’90s, yes? President Clinton tried to maintain his new direct-lending program, which made Uncle Sam the lender — not just insurer — of the loans.

Yes. President Clinton wanted to take back the issuing of federal student loans. In the dust-up over that, he was forced to accept the privatization of Sallie Mae to get what he wanted. This was the [Newt] Gingrich Contract with America-era Congress. There was widespread suspicion that government can’t do things efficiently and we need to get the private sector to roll up their sleeves and make this stuff work, and that’s what we got.

Suddenly, hedge funds, investors, lots of banks had a more direct role, not just in lending, but in the fees, services, in the collection. And Sallie Mae and other financial organizations began marketing private loans with higher interest rates and fees and with fewer relief options?

Right. All of the functions of the student loan program originally were run by government agencies, bureaucrats, I guess you could say in a dismissive way, but they were not motivated by profit. They were there to make the program run. When you privatize collections, you get really aggressive companies that come in there and work really hard to get the money back. That’s totally understandable in the corporate context. But we started this trying to help people get educated and get on with their lives. And now you’ve got thousands upon thousands of students who fall behind on their debt harassed from dawn to dusk, hassled, pushed hard, and in some cases even when they aren’t in arrears on their debt, having to deal with all kinds of crazy stuff that’s really in the name of a government program.

[Note: In 2014, Sallie Mae spun off many of its operations into a separate company called Navient Corp., which today is the largest servicer of federal student loans and serves as a loan collector on behalf of the U.S. Department of Education.]

You write that in the three-year period 2010 to 2013, when students began to shoulder more and more debt, Sallie Mae’s profits were $3.5 billion. And the former CEO of Sallie Mae, Albert Lord, was instrumental in that. In your story, Lord says, “Look, it wasn’t the private lenders that made this mess.” He blames universities and the government. And universities, and state governments in particular, are not blameless here. Budget cuts led schools to raise tuition, and the debt burden widened. Doesn’t Lord have a point?

He does. There’s been tremendous disinvestment in public higher education in our country. It peaked in the 1970s. Our reporting showed that if state legislatures had continued to support higher ed at the rate they were in 1980, they would have pumped an additional $500 billion, billion with a B, into state university systems. Interestingly, that’s just about how much outstanding debt is now held by people who attended public colleges and universities. You see the symmetry. As the states disinvest, the burden is picked up by the students, and the way they pay for it is they borrow the money.

http://www.npr.org/sections/ed/2016/07/11/484364476/im-a-student-debt-slave-howd-we-get-here

Education

Why High School Students Need More Than College Prep

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I step up to the counter at Willy’s Cafe at Willamette High School in Eugene, Ore., and order a latte.

There’s a powerful scent of fresh coffee in the air, and a group of juniors and seniors hover over a large espresso machine.

Carrie Gilbert, 17, shows how it’s done: “You’re going to want to steam the milk first,” she explains. “Then once you have the coffee, dump it in and use the rest of the milk to fill the cup.”

She hands over my order. Not bad.

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Education

Want Kids To Eat More Veggies? Market Them With Cartoons

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Sammy Spinach (far left), Erica Eggplant, Todd Tomato and other characters in the Super Sprowtz gang with Roger, the super hero trainer (center).

Courtesy of Super Sprowtz

Be it SpongeBob SquarePants or Tony the Tiger, food companies have long used cartoon characters to market their products to children. But that tactic can also sway younger kids to eat fresh vegetables, according to a new study.

Sammy Spinach, Oliver Onion, Colby Carrot, Suzy Sweet Pea and a slew of cartoon vegetable characters with superpowers were developed as puppets by a nonprofit organization called Super Sprowtz. Using live puppet performances across the country and short videos featuring the veggie characters with stars like basketball legend Shaquille O’ Neal, the organization has been trying to make vegetables more appealing to children.

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Education

What Good Preschool Looks Like: Snapshots From 4 States

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Sean Ashby/Getty Images

A new report, out today, provides 186 pages of answers to one of the toughest questions in education:

What does it take to get preschool right?

Parents and politicians alike want to know. States are spending roughly $7 billion this year on early childhood education, despite the fact that there are more cautionary tales — like this one from Tennessee — than success stories.

Today’s release from The Learning Policy Institute, “The Road to High-Quality Early Learning: Lessons from the States,” helps balance the preschool debate by highlighting a handful of states that appear to be getting pre-K right: Michigan, West Virginia, Washington and North Carolina.

Here’s a quick primer on each program and a few reasons why the LPI thinks they’re working.

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Education

Looking For Change, Teachers Hit The Campaign Trail

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Lilli Carré for NPR

You can normally find Shawn Sheehan teaching math and special education in Norman, Oklahoma, just south of Oklahoma City. But school’s out for the summer and instead, he’s knocking on doors.

One-by-one he’s asking voters in the state’s central Senate District 15 to cast their vote for him. He’s running unopposed in today’s primary as an Independent, and after the polls close he’ll know his Republican opponent.

Sheehan, 30, isn’t going at this alone. Nearly 40 other educators, a record number, are on today’s primary ballots in the state. Many of the teachers and principals running say they’re fed up with state politics after constantly rallying for more funding, and fighting off policies they say don’t work well in the classroom.

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