A good education as the foundation to a strong financial future was a key point in President Obama’s State of the Union address.

“The best anti-poverty campaign around is a world class education,” Obama said in his Wednesday night speech. “In the United States of America, no one should go broke because they chose to go to college.”

Obama proposed reforms to student loans that would forgive debts after 20 years, cut the minimum required payment to 10 percent of discretionary income and make all student loans direct federal loans.

Eastern has used federal direct loans for several years already.

“For our students, there won’t be a difference in the way student loans are distributed,” said Jerry Donna, director of financial aid. “The interest rate on these federal loans continues to go down every year.”

Donna thinks the federal loans are easier for students because of their simplicity.

“When you leave school, you know who your lender is, the U.S. Department of Education,” Donna said. “Rather than the government giving a subsidy to banks to fund these loans, why not keep it and do something else, like increase Pell grants.”

An expansion of the Pell grant program was another of Obama’s proposals.

This will provide access to higher education for a larger number of potential students, an investment President Bill Perry believes will benefit the nation’s future.

“Countries all over the world find way to subsidize higher education to varying degrees of success,” Perry said. “Grant programs are clearly investments on part of the state and federal governments in our future. Current situations aside, we built a strong economic environment by investing in higher education.”

According to Donna, students who graduated from Eastern in 2009 had an average loan debt of $15,228.

“Our students are well under the average in their indebtedness compared to the rest of the country,” Donna said.

Still, Perry warns that borrowing money must be done responsibly.

“After you graduate, you get a job and you

pay off that student loan, and it may mean you give up something else,” Perry said. “If there is going to be a benefit, there needs to be a responsibility.”

Student loan debts remaining after 20 years, 10 years for those who chose low paying careers in public service, would be forgiven and absorbed by taxpayers.

“Anytime you forgive debts, regardless of the timetable, it’s not free,” Perry said. “Someone has to pick up the slack. The program will need a lot of analysis before it can work.”

Sarah Ruholl can be reached

at 581-7942 or seruholl2@eiu.edu