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5 Things You Need to Know About Student Debt as a Campaign Issue

06/05/2015 04:47 pm ET | Updated Jun 05, 2016

Student loan debt will be a key issue in the 2016 presidential election - and it should be. The $1.3 trillion in student loan debt has become a defining economic factor for students and graduates across the country. As a voting bloc, Millennials have already flexed their power in the 2008 and 2012 election, and candidates have been working hard to snag those votes for 2016. It is vital that young voters, especially graduate and professional students, know who will be looking out for them in the Oval Office, and who is just spinning their wheels.

As candidates battle for nominations, you can expect a lot of promises will be made. How can you keep it all straight? Well, we have put together a handy-dandy survival kit for the 2016 presidential election - student loan debt edition. As we enter campaign season, here are six things you should know:

1. Recent legislation has provided significant victories at a significant cost. When the 2011 Budget Control Act lifted the debt ceiling, it provided $7.5 billion to the Pell Grant program. But the funding came at a cost - including eliminating subsidized loans for graduate students with a demonstrated financial need. This means graduate and professional students will accrue interest on all of their loans while in school, and during their grace period after graduation. Subsidized loans have other valuable protections that graduate and professional students will miss out on, including not having to pay the interest that accrues on those loans for three years when a borrower has an economic hardship deferment - and during the first three years a borrower is enrolled in Income-Based Repayment (IBR) or Pay As You Earn. Without these provisions, borrowers will be impacted at their most vulnerable points during repayment: when they are leaving school, in hardship deferments, and when they begin repaying their loans.

2. Short-term solutions have been patching long-term problems. When Congress passed the Bipartisan Student Loan Certainty Act of 2013, it prevented interest rates from doubling by extending the current rate for two years. At the same time, the new law raised the interest rate cap so that when rates go up, students will be paying much higher rates than before - graduate and professional students relying on PLUS loans will be paying the highest rates of all. Because Congress passed the buck two years ago, tomorrow's graduates are facing even worse debt.

3. The federal government is making huge profits on students who borrow. The government is projected to earn about $127 billion from student lending over the next ten years. In particular, graduate students make for the best borrowers because they pay higher interest rates and are less likely to default.

4. There are already proposals that will harm students. The House Republican budget proposes freezing Pell Grants for 10 years, eliminating subsidized loans for undergraduates, repealing improvements to income-driven repayment plans, and dismantling Public Service Loan Forgiveness (PSLF). (Watch it here on C-Span.) The administration's budget proposes capping PSLF at the undergraduate loan limit of $52,500 - leaving graduate and professional students out in the cold. Voters should keep tabs on candidate promises and voting records as the election unfolds.

5. Upcoming regulation also disfavors graduate and professional students. The revised Pay As You Earn (REPAYE) plan will be available to borrowers this June. However, the plan singles out graduate and professional students to extend repayment terms before forgiveness from 20 years to 25 years.

The 2016 presidential election could be a turning point for the student debt crisis. Graduate and professional students should keep tabs on candidate promises, and voting records. Seize the opportunity to make student debt a key issue for the White House by making your voice heard! For more information on student debt, follow us on Twitter at @EJW_org and check out our resources for understanding and managing your student debt.

Isaac Bowers is Associate Director for Law School Engagement & Advocacy, overseeing the Student Debt, Student Engagement, and Law School Relations programs. He was previously responsible for the organization's educational debt relief initiatives. In that capacity, he wrote a weekly blog for U.S. News; conducted monthly webinars for a wide range of audiences; advised employers, law schools and professional organizations; and worked with Congress and the Department of Education on Federal legislation and regulations. Prior to joining Equal Justice Works, he was a Fellow at Shute, Mihaly & Weinberger LLP in San Francisco, where he represented citizen groups and local agencies in environmental litigation and land use and planning issues. Isaac received his J.D. from New York University School of Law.

Lauren Hunter is a Communications Consultant for Equal Justice Works, and a full-time Ph.D student in the Department of Communication at the University of Maryland. She studies rhetoric and public address with a focus on rights and public policy.