OP-ED: S.T.A.R. Act would protect financial aid

    This month, Rep. Tom Petri (R-Wis.) introduced into Congress the Student Aid Reward (S.T.A.R.) Act, which, if passed, would save the federal government billions of dollars and direct at least half of those savings to student-grant aid.

    It works like this: There are two ways the federal government gives loans to students, through the Federal Family Education Loan program and through the Direct Loan Program. Under the FFEL program, the government subsidizes companies like Sallie Mae to provide low-interest loans to students. Under the DL program, the government directly lends to the students themselves.

    You can probably guess which program costs the government more. The average Stafford Loan, for example, costs the government $1.70 for every $10 loaned under the FFEL program and 45 cents under the DL program. The White House’s own Office of Management and Budget has concluded that FFEL costs about 12 times as much as direct loans on the whole.

    The loans look identical from a student perspective (same interest rates, origination fees, etc.), and each university individually decides which program to use. What STAR does is ask each school to choose the more cost-effective program, and if they do, the government gives that school at least 50 percent of the savings in the form of grant aid. Analysts estimate that over $17 billion dollars could be given to schools over the next 10 years under the S.T.A.R. Act, and all at no extra cost to the taxpayer.

    The S.T.A.R. Act has been introduced into the House of Representatives with 31 bipartisan co-sponsors. Our A.S. Council has passed a resolution in support of the S.T.A.R. Act and is meeting with Reps. Randy “Duke” Cunningham (R-Escondido) and Susan Davis (D-San Diego) to co-sponsor the bill. But we need your help.

    There will be a “Call-In Day”on April 20 for UCSD and CSU San Marcos students to call and fax Cunningham’s and Davis’ offices asking them to join their colleagues in co-sponsoring the S.T.A.R. Act. It’s simple: Just call the numbers below and tell the staffer that you are a student from UCSD and that you urge the representative to support the bill:

    • Rep. Randy “Duke” Cunningham, (858) 755-8382.

    • Rep. Susan Davis, (619) 280-5353.

    If you want, you can even come up to the Senate office on the third floor of Price Center and use our phones. Please tell all your friends and join us in the fight for federal financial aid.

    Ted McCombs is the project director for ASUCSD external affairs and Revelle College senior senator.

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