Once again Congress failed to act. On July 1 the interest rates for Stafford loans jumped to 6.8%, which is double the current rate. It is not like Congress did not know this was coming. The July 1 deadline has been set for a year.
Since January 2013, we only saw democrats stepping up to present solutions to this problem. Congressional Republicans refused to engage in this issue and decide instead to stop any legislation from passing. They chose to leave students with an unprecedented interest rate hike.
Senate Democrats were looking for an extension by passing a bill that would freeze the interest rate at 3.4% for another year while they continued to debate a long-term solution. However, Senate Republicans blocked that bill from advancing today. Of the 51 senators who voted in favor of taking a vote on the bill, there was not a single republican. Sixty votes were needed to move the bill forward. Senator Reid promised that negotiations over student loan interest rates will continue.
It is discouraging though that our leaders wait until after the problem has occurred to begin devising a solution.
Congress’s inaction on student loan interest rates was also largely due to the House and Republicans. House Republicans voted along party lines to deny a freeze in interest rates for another year and voted for their plan that would have added an estimated $15.6 billion to the total amount of student loan debt in the next decade.
Inaction on #StudentLoan interest rates was largely due to the House and Republicans.
Before today there was simply no action in the senate. They took NO VOTES on any bills related to student loan interest rates. The conversation around interest rates by US Senators has really only happened in the last month or so and was primarily held by democrats.
US Senator Baldwin has been vocal about supporting bills from fellow democratic senators designed to keep interest rates from doubling. Her republican colleague, Senator Johnson, in addition to voting no today, did not address this issue. His answer to the student loan debt crisis is more private colleges. Student and their families who hold this debt are looking for leadership and relief on interest rates for students, not doubled rates or more private colleges.
Helping the 37 million people with student loan debt and controlling skyrocketing tuition needs to be a priority in congress. Democratic Senators have proposed bills to help students and their families battle this debt. In May, Senator Gillibrand from New York introduced the Federal Student Loan Refinancing Act, which would lower interest rates for many borrowers repaying their federal student loans.
Senator Durbin from Illinois has been advocating for the Fairness for Struggling Students Act since January. That bill would make private education loans dischargeable through bankruptcy like they used to be in 2005 before Congress and the banks changed the bankruptcy code. And Senator Brown from Ohio wants to pass legislation that would give those with expensive student debt the ability to refinance into cheaper loans at no cost to taxpayers.
In contrast, Senate Republicans have not put forward any proposals that would help Americans burdened by what has become lifelong debt.
It wasn’t just Congressional Republicans that refused to address student loan interest rates, the media was also absent from the conversation. Stories about what the 6.8% rate meant, who was impacted by this change, and disgust at Congress’s inaction were posted a few days before and after rates doubled.
The mainstream media attention doesn’t do much good when the deadline has already passed. These stories needed to be on the front page weeks ago to give people time to contact their representatives and demand a solution.
Unlike other news outlets, One Wisconsin Now has been talking about student loan debt since 2011 and will continue to push this issue until real solutions happen. Congress can only respond to their constituents when the constituents are adequately informed of the problem.
Many changes are needed to help alleviate the problem, and these changes will only happen if this issue becomes prominent enough to spur change.