Rubio: Student loans worse than indentured servitude

WASHINGTON, Nov. 6 (UPI) -- Republican presidential hopeful Marco Rubio renewed his push for private lenders to finance higher education, saying student loans are worse than indentured servitude.

The Florida senator, outlining his plan to tackle $1.2 trillion in outstanding federal student loans, told a group of young professionals in New Hampshire the federal government has considerable latitude when collecting the debt, making it worse than a form of slavery.

Rubio, who once owed $100,000 in student loans, outlined his student investment plan to allow private investors to loan money to students. In turn, students agree to repay the loan with a percentage of their income for 15 to 20 years. This puts the financial risk on the investment group instead of the student, he said.

Through his plan, investment groups would determine if a borrower is a worthwhile risk, based on "who you are," your background, resume, GPA, transcripts and future goals.

"If you are a good investment, they pay for your tuition," he said.

When asked by a moderator at St. Anselm College in Manchester, N.H., to describe the difference between his plan and indentured servitude, Rubio replied, "A student loan is worse. You still owe the money."

"The difference is if you don't pay back the investment group, you have a contract, and they can obviously have legal remedies for it, but if you don't pay back your loan, it ruins your credit. They'll collect on you for the rest of your life," he said. "Because they're federally backed, they'll garnish your wages. They'll take it out of your tax return if necessary, so I think it's way better than the issue of whether you want a student loan."

In his plan, investment groups take a calculated risk to make a possible "bad investment."

"On the student investment plan, the risk is on the investment group. If you don't make enough money to pay them back in that defined period of time, they made a bad investment. In the student loan, if you borrowed $100,000, you owe $100,000, and you will owe that $100,000 until the day you die or pay it off," said Rubio.

Rubio's comments come after he reintroduced the Investing in Student Success Act to set up an action plan for the investment groups. The bill stalled in Congress last year.

"Students would have no loan balance to repay, so some students might end up paying less than the amount given to them and others more. These plans would serve as a voluntary alternative to student loans," his campaign said.