Students feel burn of sequester cuts in fee hikes, despite inaction on fraud

[WestVirginiaRebel]

Fox News:

The effects of the sequester have spread to the hallowed halls of education.

Both graduate students and the parents of undergrads have been quietly receiving letters from the federal Department of Education. The letters say the fees on their Direct PLUS loans from the government are being raised as a direct result of the automatic budget cuts that kicked in this month because Congress and the White House couldn't come to a fiscal agreement -- despite prior reports on waste and fraud which the department has allegedly been slow to address.

“On August 2, 2011, Congress passed the Budget Control Act of 2011, which put into place automatic federal budget cuts, known as the 'sequester.' While this law does not otherwise change the amount or terms or conditions of your Direct Loan, it does raise loan fees on Direct PLUS Loans first disbursed after March 1, 2013,” reads a copy of the letter obtained by FoxNews.com.

“Specifically, the fee on your loan will increase from 4.0 percent of your loan amount to 4.204 percent. For example, the fee on a $10,000 PLUS loan will increase by $20.40 from $400.00 to $420.40,” the letter continues.

While the increase is slight, many families will still have to tighten belts on already strained budgets, and some feel that they are being punished for a stalemate between Democrats and Republicans in Washington.

“The lack of action on both sides is an atrocity,” Kansas resident Russell Schroeder, who currently has two daughters in college and received the letter, told FoxNews.com. “Everyone talks about bipartisanship, but no one gives an inch. ...

“If I managed our budget like Washington did, my family would be out on the street.”

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Budgets are for little people...