The House began debate on keeping the interest rate at 3.4% on a loan that allows college students to borrow as much as $5,500 for the coming school year. If Congress fails to act, the rate will rise to 6.8% for money borrowed starting July 1, tacking on more than $1,000 in extra costs over the life of the loan.
Republicans, who in the past have been concerned that federal loans have driven up the cost of a college degree, came around to supporting a one-year extension of the 3.4% rate and swiftly scheduled the Friday vote. The move came after President Barack Obama began traveling around the country to press the issue, in an election-year appeal to students, who were a key part of his 2008 election.
But Republicans want to pay for the $6 billion subsidy by eliminating a prevention and public-health fund created by the 2010 health-care law—a nonstarter for both the White House and congressional Democrats. House Democrats want to cover the cost by taking away tax breaks from oil companies. The White House backed up its congressional allies on Friday and criticized the Republican plan.
"This is a politically-motivated proposal and not the serious response that the problem facing America's college students deserves," the White House said in a statement. If the legislation is sent to Mr. Obama, "his senior advisers would recommend that he veto the bill," the White House said.
The Democrat-controlled Senate is set to hold a vote on May 8 on extending the 3.4% rate for another year.
12 comments:
I think we should take the republican side because I think we spend to much time with the health care reform and it has done nothing. It would be better to do the republican way with the loans because it would give them time to pay it off.
I think it's ridiculous to even CONSIDER increasing the interest rate on student loans. College is already expensive enough as it is without loans at all, but then when you tack those on, the sums add up quickly. My parents advised me this year to not take any student loans whatsoever, and get all the scholarships possible, and after doing some math, just with the $5,500, the 6.8% interest will increase the pay-back cost by almost $400.. IN THE FIRST YEAR. And there's no one who will have their student loans payed for while they're in college.
Increasing the interest rate is absolutely ludicris.
I think that the government should keep the tex rates down for college loans, because when you in college your already almost paying an arm and a leg the last thing you need is the bankk breathing down your neck with interest rates. I understand colleges have to make money to keep giving quality education but in this day and age the amount you have to pay for one year of college is crazy, and having a bank charge you even more money that you don't have could cause a ton of stress.
Student debt is an issue that is near and dear to the hearts of a lot of us as we decide which colleges to attend. This should not be a political issue. Education is one of the propellors of our country's well-being, and it is in everyone's best interest to have a well-educated citizenry. Student loans should be offered at the lowest possible interest rate.
Why are they vetoing the bill to help college students? The majority of the people who take out loans like that need financial help but are not elegiable for financial aid. If they need the help why then would you want to make them pay more over the life of the loan? Also I thought only the president could veto a bill not his senior staff.
Student loan plans is a pressing topic because it has a significant role on the economic prosperity of my generation. Suffering from a handicapped economy college loans and interest rates will influence a graduates ability to prosper. To minimize student debt programs must be instated for students to be set on the right path. Unfortunately, programs like these are costly and, as seen in paragraph three, the money to alleviate student debt must come from some place else. Finding that place, of course, is challenging and our bipartisan government may never agree.
This idea of the interest of student loans going up should be taken more seriously by Congress. Student loans are already feared as the loan that never gets paid off. The idea of taking away the tax breaks that oil companies are getting and how it would pay for helping keep the interest rates down is a wonderful idea.
As the cost of tuition at colleges and universities continues to rise, the raising of interest rates from 3.4 to 6.8 percent will certainly be unpopular among those who are affected by the change. Not surprisingly, Republicans and Democrats can't decide how to pay for the continuation of the subsidy. In a presidential election year, the party that manages to get the extension passed may obtain an edge in the voting populace, especially among the college student.
I think it's important to keep borrowing costs low for college loans because otherwise we are deterring the desire for education. Helping kids pay for their education (or just reducing the rates really) will probably end up injecting way more money into the economy and will create a better future generation (so cliche, but true). Where the money will come from for this I'm not sure but it is definitely a good idea and ad someone who's soon going to college I support keeping interest rates for student loans low.
With the costs of college already beyond the reach of most average Americans, it is absolutely ridiculous for them to even consider increasing the interest rate on a student loan. America constantly complains that we are not at the same level as other nations when it comes to education. Of course, their education costs money as well but the problem in American is so much more prominent than the problems in those other nations. There are a large number of students who have the intelligence required for school and the will to go but are inhibited by the high costs. Increasing the interest rate will only inhibit them even more and lead to an even greater population of uneducated Americans and, as a result, more impoverished Americans.
The clock is running until the election, and both parties know this. They're both trying to appeal to the voters through doing this; however, each party had to make their own drastic agenda. They both have to appeal to voters in election times, so neither party can afford to make any slips ups.
Student loans are oftentimes the only way that college/graduate students can receive higher learning degrees. I'm not sure government officials notice this, but students and educators alike know that this is a huge deal. Many people are going into debt because they don't receive student loans.
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