Stephen Burd: All Related Content

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Yeshivas Score Huge Pell Grant Windfall | Forward

October 31, 2012

Stephen Burd, a senior policy analyst with the New America Foundation's education policy program, said the Obama administration has tried to curb abuse by introducing regulations that assess whether colleges provide “gainful employment” to their students.

Phoenix Reloads | Inside Higher Ed

October 26, 2012

"I wouldn't bet against them," says Steve Burd, a senior policy analyst at the New America Foundation and frequent critic of for-profits. Burd joined fellow skeptics about the industry as well as some financial analysts in praising Phoenix for making painful but proactive moves to reposition itself ...

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In the Fight Over Financial Aid Award Letters, Students Must be Heard

October 25, 2012

A slew of recent reports dealing with student debt make crystal clear that students need to be better informed about the financial aid packages that colleges are offering them. Too often, colleges are not upfront about the amount of debt they are asking students to take on – leaving these individuals without even a basic understanding of how much they will be on the hook for once they leave school.

This argument is made most explicitly in a report released this month entitled “Lost Without a Map: A Survey About Students’ Experiences Navigating the Financial Aid Process.” The firm NERA Economic Consulting and the advocacy group Young Invincibles surveyed 13,000 students and recent graduates with an average debt of more than $75,000, and found that about a quarter of respondents with federal loans and nearly half of those with private loans felt that they had not received accurate information about their financial aid from their schools. As a result of the lack of adequate guidance, many students who take on extremely high levels of debt “do not have a clear idea about the consequences of the loans they take out, with many experiencing misunderstanding or surprise regarding repayment terms and interest rates,” the report states.

Those surveyed clearly believe that colleges have a responsibility to ensure that students understand their student aid options. In fact, more than 90 percent of the respondents agreed that the financial aid award letters that most colleges send out each spring need to be standardized to make the forms easier to understand and compare – with “common definitions and clear terms” to describe the schools’ student aid offerings.

Battle Of The Student Loan Scams | Daily Reckoning - Australian Edition

October 24, 2012

'Stephen Burd, the editor of the New America Foundation's Higher Ed Watch blog, has written that Sallie Mae has often allied itself with for-profit colleges—not all of them reputable—thereby helping fund private student loans "with interest rates and ...

The Real Story Behind Corinthian Colleges’ Plummeting Default Rates

October 8, 2012

In examining the student loan default rate data that the U.S. Department of Education recently released, it’s hard not to marvel at the success that Corinthian Colleges has had in driving down its schools’ two-year cohort default rates.

The for-profit higher education corporation’s two-year rates have plunged across the board, with most of them dropping by double digits. For example, the company’s Everest College campus in Thornton, Colorado saw its rates plummet, from 27.3 percent in 2009 to 3.7 percent in 2010. Similarly, at Everest Institute in Pittsburgh, the rate dropped from 25.2 percent to a remarkably low 1.1 percent. [The company has been much less successful in lowering its schools’ 3-year default rates. Those were 34.9 percent at the Thornton campus and 28.6 percent in Pittsburgh. But the government won’t start holding schools accountable for these rates until 2014.]

How did Corinthian’s leaders achieve this remarkable feat? Did they do it by:

A. Radically improving the quality of the programs their schools offer to ensure that their graduates have the skills they need to obtain gainful employment in their fields of study?

B. Slashing prices so that students don’t have to take on so much debt?

C. Overhauling their schools’ recruiting practices to ensure that they enroll only students who they know can succeed in their programs?

The correct answer is “none of the above.” Instead, as the Senate Committee on Health, Education, Labor and Pensions has documented, Corinthian officials have engaged in a no-holds-barred campaign to drive down their schools’ rates by pushing former students to obtain temporary forbearances and deferments on their loans. The company’s sole purpose has been to prevent these borrowers from going into default during the current two-year window when the Education Department holds schools responsible for their rates.

Why Congress Should Not Revive the Higher Education Tax Deduction

September 18, 2012

The Higher Education Tax Deduction, the most regressive of all the government’s tuition tax break programs, expired in December. But unfortunately, we may not have seen the last of it.

As our sister blog Ed Money Watch reported last month, the U.S. Senate Finance Committee has approved legislation that would revive the tuition tax deduction program, which allows students and their families to subtract from their taxable income up to $4,000 a year in tuition and fees. Under the measure, filers would be able to continue claiming the benefit in tax years 2012 and 2013.

Congress created the tuition tax deduction as part of President George W. Bush’s broader tax cut legislation in 2001. Private college leaders championed the deduction, saying it would be more helpful to students attending their high-priced schools than the Hope and Lifetime Learning tax credits that the Clinton administration and Congress created in the late 1990s to make college more affordable for the middle class. Powerful lawmakers from Northeastern states, where these institutions are heavily represented, took up the cause and convinced their colleagues to include the deduction in the larger tax cut package.

A Big Default Problem, but How Big? | New York Times

September 8, 2012

Stephen Burd, senior policy analyst with the New America Foundation's Education Policy Program, called the official default rate “an extremely flawed measure.” “For years, Democratic and Republican administrations alike touted 'record low' rates to ...

Getting Rid of the Student Loan Repo Man

August 29, 2012

Over the past 25 years, federal officials have put in place a punitive student loan collection system that is designed to stop “deadbeat” borrowers from ripping off the government by failing to repay their debt.

Among other things, policymakers have made it virtually impossible for student loan borrowers to discharge their debt in bankruptcy, and have removed any statute of limitations on the collection of these loans – allowing the government to unleash an army of student loan collection companies to pursue these borrowers to the grave. They have also empowered the government to garnishee the wages of defaulters without a court order, and seize tax refunds and other federal benefits, such as Social Security payments from elderly and disabled borrowers.

It is certainly unacceptable for students to take out federal loans without having any intention of paying them back. The reality, however, is that many, if not most, people who default on their federal loans do not choose to do because they want a “free ride.” They do so because they simply don’t have the money to make their payments.

Yet, as I wrote in a Washington Monthly article entitled “Getting Rid of the College Loan Repo Man,” our system for collecting on defaulted federal student loans does not recognize that distinction. Borrowers who deliberately skip out on their loans and those who are too financially distressed to repay them are subject to the same harsh treatment.

Answering the Critics of "Pay as You Earn" Plans

  • By
  • Stephen Burd,
  • New America Foundation
August 27, 2012 |

Tying the repayment of student loans to a borrower’s income is hardly a new idea. Conservative economist Milton Friedman proposed the basic concept in 1955, and so-called income-contingent loans (ICLs), or “pay as you earn,” plans have been championed by many liberals since. This has also given critics plenty of time to come up with well-worn criticisms that are certain to come up again if this proposal gets legs. Here are some of the arguments, followed by our responses:

Stephen Burd: Fire the Student Loan Debt Collection Companies

August 27, 2012

Washington, DC — More and more student loan borrowers are falling behind on their payments, putting them in danger of getting caught up in the brutal gears of the government's student loan collection system, according to reporting by Stephen Burd, senior policy analyst in the New America Foundation's Education Policy Program.
 

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