Do you need scholarship and grant money to help pay for college? There is a LOT of talk in the government about re-directing federal money for college students, so it’s time to pay attention to politics!

If you are thinking about going back to college, but you aren’t certain where you will get the money you need to pay for your education, you will be glad to know that President Obama is hard at work trying to give you the help you need!

The President is hoping to redirect billions of dollars into scholarships for needy students while putting an end to a subsidized loan program that is currently in place. By replacing the current subsidized loan programs, the Congressional Budget Office claims it can save $94 billion that can then be used to expand the Pell Grant program.

Let’s define a few terms first. What is a Pell Grant? Well, the Pell Grant is part of a federal program that gives money to students who demonstrate a financial need. The best part of this grant is that students don’t have to pay the money back! On the other hand, a subsidized loan is a type of loan where the borrower doesn’t have to pay interest. In the case of the popular Stafford Loan, the government pays the interest while students are in school.

Obama’s plan is basically proposing that the government give students money directly in the form of Pell Grants, while the government is currently using their education budget to just pay off the interest on their loans.

While it’s great that President Obama is trying to make it easier for students to attend school, he has some major opponents. For instance, the private student lending industry is not too happy about his plan to increase federal spending on scholarship money because they will receive less money on interest payments! As a result, student lending institutions are vehemently fighting the President’s proposed program, with Sallie Mae—one of the biggest private student lending companies in the country— hiring two prominent lobbyists to assist with the fight.

These private lending companies have many allies in Congress who are also against President Obama’s proposal to increasing funding for the Pell Grant. Many members of Congress are unsure of where they stand on the issue because this program would upset some of the biggest employers in their districts, in addition to limiting Congressional control on student aid.

Those who support the program, on the other hand, feel that private lenders have enjoyed a “free ride” for years that has allowed them to collect hefty profits without having to take much of a risk since the government currently guarantees repayment of up to 97% of the amount loaned. As a result, supporters argue, the government is already directly or indirectly financing most student loans already – particularly now that the government has had to dump billions of dollars into the finance industry in order to stop it from going under.

If the President is to get this new system to go through, one thing is for certain: he will have quite the battle on his hands to get it there. But, for the thousands of people who are looking for ways to take their education to the next level, President Obama and his plan may very well give them the help they need.

To learn more about the proposed program, read a full article here.