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    Student Loan Update



    Yesterday was a big day for young people in our country — with the President citing that the acceptance of marriage equality is generational and with the student loan interest rate battle continuing on the Senate floor.

    Monday’s 52-45 vote on the Democratic sponsored Senate 2343 (Stop Student Loan Interest Rate Hike Act) was nearly party-line. BUT Senator Reid, a key vote, actually voted “no” to maintain the procedural ability to demand another vote once a compromise a reached.  Should the parties agree to a compromise, Senator Reid can bring the legislation up for a vote.

    At this point, both parties’ political rhetoric blames the other side for why they can’t compromise on funding for the bill.  Both parties — and coalition groups — believe a compromise is on the horizon though.

    Through the week, coalition groups are organizing students, and their parents and grandparents, to call their members, and push the “Don’t Block My Rate” campaign through social media channels.  In that spirit, the House Democrats are hosting a Twitter Town Hall tomorrow at 11:30am ET (#AskDems and #DontDoubleMyRate).

    Below are some news clips to read more about yesterday’s vote:

    New York Times. Republicans in Senate Block Bill on Student Loan Rates. By Jonathan Weisman. 5/8/12. Senate Republicans on Tuesday blocked consideration of a Democratic bill to prevent the doubling of some student loan interest rates, leaving the legislation in limbo less than two months before rates on subsidized federal loans are set to shoot upward.  Senators said quiet negotiations had begun to resolve the impasse, but Democrats sought to raise the political pressure, vowing to take to the Senate floor to show the cost of inaction for students in their states.  The vote was the Senate Republicans’ 21st successful filibuster of a Democratic bill this Congress, which started in January 2011.  But the student loan filibuster may be the highest-profile stalemate yet, because unlike those earlier bills, this one is not likely to be abandoned.

    Associated Press. Student-loan bill stalled in Senate. By Alan Fram. 5/9/12. Senate Majority Leader Harry Reid (D., Nev.) said the vote showed that despite GOP claims that they support preventing an increase in student loan rates, “Republicans showed today that it’s only talk.”  He also noted that the likely GOP presidential nominee, Mitt Romney, supports a temporary extension of today’s low rates and needled, “I suggest he pick up the phone and call Senator McConnell.”  That was a reference to Senate Minority Leader Mitch McConnell (R., Ky.), who said the battle is a phony one manufactured by Democrats to woo votes from students. Both parties say they want to extend low interest rates.

    Bloomberg. U.S. Senate Republicans Block Student Loan Rate Freeze Plan. By Kathleen Hunter. U.S. Senate Republicans blocked Democrats’ proposal to cover the cost of a one-year freeze in government student loan interest rates by requiring some professional services firms to pay withholding taxes on their income.  The Senate, in a 52-45 vote with 60 required, didn’t advance the plan to avert a July 1 increase in college-loan interest rates to 6.8 percent from 3.4 percent. No Republicans joined Democrats in voting for the measure.  “Over the last few weeks, Senate Republicans have repeatedly claimed they support efforts to keep interest rates low for federal student loans,” Senate Majority Leader Harry Reid said before the vote. The Nevada Democrat urged Republicans to “end the needless filibuster” of the Democratic proposal.

    Talking Points Memo. After Brief Detour, Senate GOP Returns To Obstruction. By Sahil Kapur. 5/9/12. Senate Republicans’ Tuesday filibuster of a Democratic bill to avert a student loan interest rate hike signals a return to familiar territory for the party. The move comes after a brief detour that spurred speculation about whether, with the general election in full swing, Republicans were ready to ease up when it comes to blocking hot-button issues.  The context is an effort by the GOP — and its presumptive presidential nominee Mitt Romney — to save face with key voting constituencies that strongly favor Democrats and could swing the election: women, young voters and Hispanics.

    Politico. Student loan bill blocked in Senate. By Seung Min Kim. 5/8/12. The legislation failed to muster the 60 votes needed to break a GOP-led filibuster. Senate Republicans vehemently opposed the measure because it would’ve eliminated a tax loophole for certain businesses – a move the GOP called a tax hike on job creators.  Senate Majority Leader Harry Reid (D-Nev.) argued that closing the loophole is not a new tax and said he’s more than willing to give Senate Republicans a vote on their alternative plan.  “If they want some other way to pay for it, let’s take a look at it,” Reid said before the vote. “Let them offer that. The stakes in this debate are too high to let partisanship get in the way.”

    Washington Examiner. GOP blocks loan freeze, Dems vow retaliation. By Susan Ferrechio. 5/8/12. Senate Republicans on Tuesday blocked legislation that would freeze student loan rates while raising taxes on some small businesses. Democrats have promised to retaliate politically while the two parties hammer out an all-but-certain deal in the near future.  Democrats announced Tuesday they will showcase on the Senate floor examples of hardship experienced by loan-burdened students in an effort to paint the GOP as insensitive to the needs of young people. President Obama and his party have been eagerly seeking the support of voters in the 18-to-29 age range, a group that helped the party reclaim the White House in 2008 and that Democrats need to push Obama to a second term in November.

    The Hill. To fix student loans, respect education. By Rep. Rosa DeLauro. 5/8/12.  The House Republican majority recently passed a budget that deeply slashes Pell Grants for nearly 10 million college students and allows student loan interest rates to double in July. While Democrats began working to prevent this interest rate increase, which would cost the average college student about $1,000 per year of school, one Republican member deemed it and rising college costs a “distraction” from our real problems. What Republicans never seem to understand is that keeping college affordable for students and families is vital not just to the growth of our economy, but to the continued existence of the middle class. In this tough economy, people are turning to colleges and job training because they know that is the future for them, their families and the country. 

    The Hill. Student loans latest casualty of politics. By Rep. Phil Roe. 5/8/12. Since our economic downturn, college graduates have suffered tremendously, experiencing fewer and fewer job opportunities. Nearly half of college graduates are unemployed or underemployed, and debt from student loans is piling up — totaling more than $1 trillion. We need to address these problems with real solutions that give America’s next generation sustainable opportunities for future employment.  An Associated Press analysis of government data reports that half of college graduates are either jobless or are underemployed. All of this has occurred despite policies — most notably the stimulus — enacted in the name of solving this economic crisis. These policies have led to soaring deficits and debt as far as the eye can see.

    The Hill. Debate on student loan debt doesn’t go far enough. By Robert Appelbaum. 5/8/12. As Congress debates the extremely narrow issue of whether to extend the current 3.4% interest rate on Federal Student Loans, or to let that rate expire and, thus, double to its previous level of 6.8%, both sides of the aisle are missing an opportunity to do something unique, decisive and bold: adopt legislation that forgives excessive student loan debt after a reasonable repayment period.  Representative Hansen Clarke (D-Mich.) introduced an unprecedented piece of legislation in March – H.R. 4170, The Student Loan Forgiveness Act of 2012, in response to over 660,000 people who signed a petition I started in favor of student loan forgiveness. Yet, despite the public outcry, only one member initially stepped up to put his name and reputation on the line in order to draw attention to the ever-growing crisis of student loan debt.  Rep. Clarke has taken on the role of Champion for the educated poor – the 36 million Americans who are drowning under the weight of their student loan debts. A new petition I started in favor of H.R. 4170 currently has over 939,000 signatures.

    Christian Science Monitor. Student loans: GOP filibuster blocks Senate move to freeze low rates. By David Grant. 5/8/12. Senate Republicans successfully filibustered a Democratic proposal to extend low rates on student loans Tuesday. While both parties say they want the legislation passed, it has fallen prey to polarized election-year politics.  Republicans largely held together in a party-line, 52-to-45 vote that fell short of the 60 votes needed to move the bill to full consideration. The devil, of course, is in the “offset.” Senate Democrats proposed what they call the “Newt Gingrich/John Edwards rule,” that would prevent wealthy individuals from shielding some of their income from payroll taxes by incorporating themselves as S corporations. The rule was so named because Mr. Gingrich and Mr. Edwards both used this financial device.

    The Fiscal Times. Student Loan Bill Caught in a Web of Politics. By Eric Pianin. 5/9/12.  Senate Republicans on Tuesday blocked Democrats from acting on a bill aimed at preventing a doubling of interest rates on federal student loans this summer. While both sides and the Obama administration insist they favor legislation that would spare millions of students and graduates a huge boost in their college debt, a festering feud over how to offset cost of holding the interest rate at 3.4 percent is threatening to scuttle the efforts.  The election year dispute highlights a major philosophical and political divide between the two parties, with Democrats insisting that wealthier Americans be required to pay more in taxes to cover necessary spending and to help reduce the deficit, while Republicans insist that any tax increase would hurt the economic recovery  and should be avoided at all costs.

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    Amanda Brown
    Bio: Amanda Brown is Rock the Vote's Director of Development and a proud Dartmouth alum.

    Email the author at: blog(at)rockthevote.com

    One Response to “Student Loan Update”

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