4 Monday, June 8, 2009 The Michigan Daily - michigandaily.com Mry fidigan &Dilt Edited and managed by students at the University of Michigan since 1890. 420 Maynard St. Ann Arbor, MI 48109 tothedaily@umich.edu ERIKA MAYER IVIEWPOINT Excessive benefits JAMIE BLOCK EDITOR IN CHIEF ROBERT SOAVE MANAGING EDITOR RACHEL VAN GILDER EDITORIAL PAGE EDITOR Unsigned editorials reflect the official position of the Daily's editorial board. All other signed articles and illustrations representsolely the views of their authors. Adult supervision required Credit CARD Act discourages young adult financial independence .College students need a babysitter. Or at least that's what the feder- al government thinks, if the Credit Card Accountability, Respon- sibility and Disclosure Act of 2009 is any indicator. The Credit CARD Act requires all credit card applicants under the age of 21 to have a co-signer above the age of 21 or to prove their ability to be responsible with a credit card. But the law doesn't respect the autonomy of college- aged individuals as legal adults and hurts their financial independence. Though the CARD Act has its merits, the federal government should reevaluate the need to treat young adults like children. A salary; medical, dental, vision, prescription, and life insurances; retirement savings partially matched by the Uni- versity; and legal and long term disability plans don't seem to be enough benefits for University staff members. According to an article in the Ann Arbor News on May 23, they are requesting sub- sidized tuition for their depen- dents, citing the recent economic downturn as the reason and put- tingthe needs of their dependents before the 41,000 tuition-paying students at the University (Uni- versity of Michigan cool to tuition benefitfor staff 05/23/2009). Specifically, staffers are asking the University to match funds in the Michigan Education Trust - a program in which parents can pay tuition for a state university early at a rate that will not change when tuition is raised in later years. The staffers are request- ing a match of up to $3,000 per dependent. They argue that for the University to remain com- petitive with other institutions, it must create some sort of tuition program for its employees. But the University already providesha considerable number of benefits. University spokes- woman Kelly Cunningham was quoted in the Ann Arbor News saying the University is already "at or above average" employee benefits. This alone negates the argument staffers are putting forward about attracting top employees. Thisrequestwouldhaveserious consequences for the University. Subsidizing tuition for employ- ees' children would be extremely costly. There are 36,000 people employed full time by the Univer- sity in Ann Arbor, Dearborn and Flint, not including graduate stu- dent instructors and researchers. Who would pay the extra cost that such a financial burden would place on the University? Staffers suggest the Univer- sity could make up the differ- ence with discretionary funds and private donations. This sug- gestion is naive and misguided. If there is extra money floating around, it should be tapped for the student body as a whole, to fund programs to cutatuition for all students. Today's economy is tough for everyone, not just those who happen to be progeny of University staff. If the University can only afford to cut tuition for a small handful, the qualification to obtain aid should be based on financial need, not employment with the University. The reality is that the Univer- sity is raising tuition for every- one. The Board of Regents have made it clear that there isn't enough money to maintain the University's current operations - let alone proposed additional costs like subsidized tuition for the children of University staff - without raising tuition once again. If extra money is going to come from anywhere, it's likely to come fromthe pockets of students already paying full tuition. To ask already financially burdened students to subsidize the educa- tion of the children'of University employees is a selfish demand. The staff argues that in these tough times, the University should be taking care of its own. While the University acknowl- edges this, it also must recognize that it has an equal responsibility to each of its students - not just a select few. If the University were to raise tuition yet again to com- ply with this request, it would be ignoring the needs of the major- ity of its students. The good news is that the Uni- versity doesn't seem inclined to oblige this request. The Univer- sity feels the strain of the failing economy, too, and it doesn't think that its staff is in danger of being stolen by universities with bet- ter tuition plans for dependents. The case presented by University employees fails to provide a suf- ficient reason for the tuition plan, other than not wanting to pay for their children to go to college. If that alone were a good enough reason, everyone in the country would qualify for a tuition plan. The clincher that makes the staffer's request ridiculous lies in the nature of the MET. MET tuition can go toward any of the 13 public universities in Michi- gan. That means the University's money could pay for a college education at another college, which is absurd. The Univer- sity would see zero return on its investment. Education for every- one is important, but this request goes too far. And this proposal means an even darkerrpossibility - tuition could be raised to subsidize tuition for University staffers who could use the money to send their kids to Michigan State Uni- versity. Ouch. Erika Mayer is an LSA sophomore. President Barack Obama signed the Credit CARD Act into law on May 22 to protect American consumers from some of the unfair practices of credit card companies. The law was designed to help credit card holders make informed financial decisions by banning retroac- tive rate increases and fees and making credit card terms clear- er. But Title III of the Credit CARD Act goes further, estab- lishing barriers before young adults can obtain a credit card. The law mandates that credit card 'applicants under 21 have "a parent, guardian, or other qualified individual" co-sign their credit card application or prove their financial responsi- bility. If young adults decide to take full responsibility for their credit card and can't provide documentation that convinces a credit card company they are financially stable, they will be required to complete a financial literacy course. It's admirable that the fed- eral government has decided to protect consumers from credit card companies' misleading tactics. The Credit CARD Act protects consumers from hid- den fees and rate increases. It ensures that consumers can eas- ily understand their credit card terms and decide if they are able to successfully use them. But this decision should be left to all consumers, not only those 21 and older. Despite the good qualities of the Credit CARD Act, the restrictions laid out in Title III seem like a lot of work to obtain a card that makes a financially stable future possible. While it's nice that the federal govern- ment wants to protect younger citizens, this clause is a major stumbling block for young adults who are ready for finan- cial independence. By making young adults jump through more hoops to obtain a credit card than older adults, LETTERS TO THE EDITOR the federal government is tak- ing the view that college-aged people aren't really adults yet. But as legally-recognized adults, 18-year-olds have most of the same rights and responsibilities as other adults. Also, many 18- to 20-year-olds are financially independent and work on their own. Many - especially col- lege students and lower-income young adults - don't have easy access to a financially stable co- signer, a full bank account or time to complete a financial lit- eracy course. But they still need the benefits of a credit card, like convenient purchases and estab- lishing good credit history. Instead of allowing young adults the freedom they need to gain financial stability, the federal government seems com- mitted to mollycoddling them. At some point, the federal gov- ernment needs to realize that college students aren't kids any- more and that they need to learn to take care of themselves. Tell us what you think. Send letters to tothedaily@umich.edu or visit michigandailycom and click on 'Letter to the editor.' Editorial Board Members: Erika Mayer, Asa Smith, Brittany Smith, Vivian Wang, Patrick Zabawa LIKE WHAT YOU SEE HERE? WANT MORE? Check out more from Daily columnists online on Wednesday and Friday. Go to michigandaily.com and click on 'Opinion.'