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Spitzer: How to Fix Student Loan Mess

Peg students' payments to their income

By Ambreen Ali, Newser User

Posted Mar 4, 2009 5:33 PM CST

(Newser) – In his latest Slate column, Eliot Spitzer shifts to education, with a solution on how to reform the student loan system. "We need to fix how Americans pay for higher education," writes the former New York governor. Rather than crippling loans that prevent bright graduates from pursuing worthy but low-paying careers such as teaching, Spitzer suggests "smart loans" that let students repay a fixed percentage tied to their income.

"The current system of hitting graduating students with immediately sky-high payment obligations just as they enter the work force is nonsensical," writes Spitzer. "Pegging repayment amounts to income earned is common sense." He says the idea, already used in Europe, is popular with conservative and liberal economists alike.

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Spitzer says "smart loans" will let students choose careers that pay less, but may hold more social value. (AP Photo/Tim Roske, file)

America's intellectual capital "is perhaps the last remaining arena where we can hope to win," Spitzer writes. (Shutter stock)

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A student who wanted to teach for several years could do so, with proportionately reduced payments, knowing that when she moved over to a more remunerative job, her payments would jump accordingly. - Eliot Spitzer

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Spitzer: How to Fix Student Loan Mess