Education News

Republican senators block student loan interest rate vote

by Mary Ellen Flannery/official White House photo above by Pete Souza

Dear Republican senators, meet Faith Rivera.

She’s just one of the nearly 7.5 million college students who you failed to serve today, when you blocked a bill that would stop the doubling of student loan interest rates this summer.

“Personally, I have never been more disappointed with Congress,” Rivera, a future teacher studying at Marywood University in Pennsylvania, said last week as Congress began its consideration of this critical college affordability issue. “What they fail to realize is there are millions of students who depend on these loans to help fund their education.”

Today’s bill, the “Stop the Student Loan Interest Rate Hike of 2012,” co-sponsored by Sen. Sherrod Brown (D-OH), Sen. Jack Reed (D-RI), and Sen. Tom Harkin (D-IA), was stopped on a 52 to 45 cloture vote, which prevented the Senate from even considering passage. The vote proceeded along party lines, with all Republican senators voting no (with the exception of Republican Olympia Snow, who voted “present”), and Democrats voting yes (except for Senate Majority Leader Harry Reid who voted no in order to preserve his right to re-introduce the legislation at a later date).

If passed, the bill would have maintained the current interest rate on federal Stafford loans, which is set at 3.4 percent. Without it, interest rates will double to 6.8 percent in July, costing the average student an additional $1,000 a year.

With college students already drowning in record amounts of debt—the average student graduated in 2010 with a whopping $25,000 in student loan debt —the last thing struggling students and their families need is additional fees. It’s also just about the last thing this country needs.

“In the long run, the most important thing we can do for our economy is to give all of you and all Americans the best education possible,” President Obama told students at Washington-Lee high school last week. “That means giving more Americans the chance to learn the skills that businesses are looking for right now. And in the 21st century, it also means higher education cannot by a luxury—it is an economic imperative that every American should be able to afford.”

A college education is a ticket to home ownership, much-needed jobs, and a stronger economy. Average workers with a four-year college degree earn about $1 million more over their lifetimes and experience half the unemployment rate of those with a high school diploma. And a recent Georgetown University study shows that, by 2018, two-thirds of the jobs in this country will require a college degree, and we will likely fall short by 3 million workers.

“Affordable college is not a charitable contribution. It’s an investment and…(it) benefits the country for generations,” wrote NEA Vice President Lily Eskelsen in a recent blog post, explaining how a federal student loan helped her pay for her education degree. “It is the foundation of a thriving middle class.”

The Democrat-sponsored Senate bill, which Brown, Reed, Harkin and others are determined to push forward, would pay for the rate freeze by closing a single tax loophole. According to tax policy experts, closing this loophole would actually help most small businesses, which are currently subsidizing the ones abusing it.

But Republicans would prefer to finance the rate freeze by raiding a public health care fund that provides mammograms and cancer screenings for women, and immunizations for children.

For her part, NEA-Student member Rivera just doesn’t understand what they’re thinking. “High school students should be encouraged, not discouraged, to attend college,” she says. “Overall, I just Congress would choose to obtain money elsewhere, rather than from students attempting to achieve a higher education.”

Do you have a story to share about college debt? Would you have chosen a different career if you knew your interest rates would be doubled? Are you concerned about the financial realities of sending your own children to college? If you are a current student, what would doubled loan rates mean to you? Tell us your story by filling out the form below and you may be featured in an upcoming Education Votes article.

 

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