The defeat of student loan refinancing

Updated: Friday, June 13, 2014
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KALAMAZOO, Mich. (NEWSCHANNEL 3) - Twenty-five million Americans saddled with high-interest student loans lost a chance Wednesday to have their rates lowered when Senate Republicans shot down legislation that would have allowed them to refinance their debt.

The bill was defeated, even as concerns are growing that mounting student debt is hampering economic recovery from the great recession because former students are so financially strapped and starved for higher paying jobs that they can't participate in our economy.

Tonight in Tom's Corner, Tom Van Howe says it's another example of our growing great, partisan shaped economic divide.


So many things in this world are the result of to whom you are born. At birth you don't choose whether you're going to be a Christian or a Jew or a Muslim. You don't choose to be poverty-stricken or wealthy. You don't get to choose the color of your skin. Nor whether you live winters in a deep freeze or in warmth and sunshine.

You pretty much become a product of your environment.

It's the accident of birth.

So  its nobody's fault that 70 percent of the college students in this country have to borrow money to chase dreams of being engineers, scientists, social workers, programmers, pharmacists, cops, prosecutors, defenders, entrepreneurs and so on.

So with the student debt burden up around $1.3 trillion, with the default rate approaching 15 percent, and with so many young people unable to buy homes, cars, start businesses--unable to participate in and contribute to our economy in any meaningful way--it stood to reason that our Congress  would ride in to the rescue.

Not to wipe our their debt. But to restructure it so students could save thousands of dollars with lower interest rates.

After all, we do it all the time. We want people to give to charity, so we offer tax breaks for donations; we want people to own homes, we devise tax breaks. We give deductions for children to encourage families. Corporations get tax breaks on things most of us can't comprehend.

And who needs the help more right now? The banks and lending companies that ran our country into the sewer a few years ago? Or young Americans who are going to be leading the charge in the years ahead?

I thought I knew the answer to that. But I was wrong.

The Senate shot it down. It needed 60 votes to carry--it got 58.

Senate Minority Leader Mitch McConnell, who surely must have come to us from some parallel universe, said "Senate Democrats don't actually want a solution for their students. They want an issue to campaign on."

Seems to me he just gave it to them.

Now, there was a catch to the bill that was introduced by Massachusetts Senator Elizabeth Warren: to take up any slack the refinancing of student debt might have created, the bill would have added a small tax on wealthy households. Not the kind of burden that would have altered anyone's life style.

"With this vote," Warren said, "we show the American people who we work for in the United States Senate: billionaires or students."

After years of speculation, now we know.

In this corner...I'm Tom Van Howe.

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Last Update on November 27, 2015 18:34 GMT


CHICAGO (AP) -- A protest march has begun in Chicago's Magnificent Mile shopping district, with the Rev. Jesse Jackson in the middle of a crowd that's shouting, "What do we want? Justice. When do we want it? Now!"

Several hundred demonstrators have gathered in the drizzling rain, many with umbrellas and plastic-wrapped signs.

They're protesting the fatal shooting of a black teenager by a white police officer last year. The recent release of a video showing the fatal shooting of 17-year-old Laquan McDonald has set off days of largely peaceful protests.

Protesters sought high visibility by taking the demonstrations to the city's main shopping area on what's traditionally one of the year's biggest shopping days.

An association representing hundreds of high-end retailers, hotels and restaurants in the district says it's confident authorities will maintain order for thousands of Black Friday shoppers. The Magnificent Mile Association represents 780 businesses on Chicago's North Michigan Avenue.


UNDATED (AP) -- "Black Friday" may no longer represent an early start on holiday shopping. For some, it may be too late.

One woman in Harrisburg, Pennsylvania, says her $200 budget today was the same as last year, but that it didn't buy as much because the best bargains were on Thanksgiving night.

Ashley Walton says the day for bargains is now "Black Thursday." She says she didn't go shopping on Thanksgiving because she was in what she calls a "turkey coma."

A Kmart shopper in Denver this morning had nearly the entire store to herself, and found it "sad." Susan Montoya said it's "no challenge" when no one else is shopping. She says people must have gone out yesterday or be shopping online.

Early numbers aren't out yet on how many shoppers headed to stores on Thanksgiving Day. The National Retail Federation expected about 30 million to shop on Thanksgiving, and 99.7 million on Black Friday.


BERLIN (AP) -- A closely-watched survey shows German consumers are losing confidence amid growing concerns of an economic slump.

The GfK research group said Friday its forward-looking consumer climate index dropped for the fourth month in a row to 9.3 points in December, from 9.4 in November.

GfK says consumers' willingness to buy rose, but that was offset by drops in both their income and economic expectations, partially linked to the growing number of asylum seekers pouring into the country.

Germany is set to receive more than 1 million refugees and other migrants this year and some 40 percent of consumers surveyed told GfK they believed unemployment would soon rise, most of them saying the newcomers would hurt the labor market.

GfK's monthly survey is based on some 2,000 consumer interviews.


BRUSSELS (AP) -- Greece and its creditors are close to sealing a deal on conditions that Athens must respect to obtain the next slice of rescue money.

The country has already received this week approval for a 2 billion euro loan, and is negotiating on more economic measures needed to get another 1 billion euros.

European Commission spokeswoman Mina Andreeva said Friday the sides have "agreed broadly the second set of milestones."

She said that when the details are ironed out "this of course would unlock the disbursement of the final one billion euros still available."

That would also allow for an important review of Greece's handling of its austerity program, which is required to secure international credit.

Andreeva said the implementation of pension reforms "is a key part of the first review."


GENEVA (AP) -- A Swiss court has convicted in absentia a former employee with international bank HSBC for economic espionage and sentenced him to five years in prison.

Herve Falciani -- seen by some as a crucial whistleblower -- had refused to travel from his native France to appear before the Swiss Federal Tribunal in Bellinzona in proceedings that began in October.

France does not extradite its own citizens and Falciani appears unlikely to serve the sentence.

Falciani was on trial for leaking bank data that led to a worldwide wave of tax evasion probes against prominent clients in France and elsewhere.

He was charged with illegally obtaining data, economic espionage, breach of business confidentiality and breach of bank secrecy while working at a Swiss HSBC subsidiary between 2006 and 2008.


Glitch causes bank customers to see billions in charges

HONOLULU (AP) -- A technical glitch meant some First Hawaiian Bank customers logged on to their accounts to find that they appeared to be billions, or sometimes more than a trillion dollars in the red.

KHON-TV reports that bank officials say the glitch was visible to customers who logged on to their accounts during a 20-minute window Wednesday. They say no actual customer information or balances were affected by the issue.

Customers who logged in at that time saw outstanding balances of at least $710 billion.

Kauai resident George White says when he saw the error all he could think was, "Well, my wife is going to kill me."

First Hawaii Bank said in a statement that the issue was resolved quickly and that the bank apologized to customers who were inconvenienced.

Washington Times