Student loan rates have become a hot topic for presidential candidates.
The Obama administration and Congress have "reduced student aid funding targeted at low-income students" in recent years, complains Stephen Burd, a senior policy analyst at Education Sector.
President Obama's American Opportunity Tax Credit (AOTC), introduced in 2009, "has proven to be a bonanza for the highest income group," Burd writes. Families making $100,000 to $180,000 receive more tax benefits, while families in the $25,000 to $75,000 range receive fewer. The government lost $14.7 billion to the AOTC in 2009—$3.88 billion to upper-income parents—he calculates.
"At a time when the budget axe is falling on the Pell Grant program, providing billions of dollars in tax benefits to upper-middle-income families who don't really need the help is a luxury that the government can ill afford," Burd argues.
Joanne Jacobs writes Community College Spotlight for The Hechinger Report, an independent nonprofit education news site. Jacobs also blogs about K-12 education and is the author of Our School: The Inspiring Story of Two Teachers, One Big Idea and the Charter School That Beat the Odds.
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