MADISON, Wis. — U.S. Senator Ron Johnson added to his stunningly ill-informed record on the $1.3 trillion student loan debt crisis with his latest comments touting his votes to “improve” new student loans by allowing their interest rates to rise. One Wisconsin Now Executive Director Scot Ross noted that Johnson’s latest comments come as momentum builds in Wisconsin and nationally for student loan debt reform, like allowing borrowers to refinance their student loans, just like you can with a mortgage, a measure Johnson has voted against twice in the U.S. Senate.
“Sen. Johnson has outdone himself with his latest comments on the student loan debt crisis,” commented Ross. “We didn’t think the guy who voted twice against a common sense reform to allow hardworking student loan borrowers to refinance at lower interest rates could be more wrong. But he’s done it, touting higher interest rates on student loans as somehow helping make college more affordable.”
At a weekend event with U.S. Senator Elizabeth Warren, the author of student loan refinancing legislation in the U.S. Senate, Russ Feingold said it is a “moral responsibility” to help the hardworking students who took on the personal responsibility to pay for their education get a fair shot at prosperity.
In response a spokesperson touted Johnson’s votes for basing the interest rates for federal student loans on the ten year U.S. Treasury bond rates, a move that could cost the average borrowers thousands of dollars in higher interest and allow rates on some loans to exceed 10 percent. In addition to higher interest rates for future borrowers, Johnson has voted multiple times against common sense relief for the 43 million Americans, including nearly one million Wisconsinites, with $1.3 trillion in student debt by allowing them to refinance their existing student loan, just like you can a mortage.
Previously, millionaire Sen. Johnson pointed to students themselves as causes of the crises of student loan debt and college affordability in public statements, based on his experience in the mid-1970s, when his tuition at the University of Minnesota was 1,700 percent lower than it is today. He has also suggested that the federal government should not be involved in helping students with low interest loans or other means to help fund students higher education.
Original research by One Wisconsin Institute found that student loan debt has a significant and negative effect on critical drivers of the economy like new car and home sales as borrowers are significantly more likely to buy a used versus new car and rent versus own their home.
Ross concluded, “Reduced investment in public education, profiteering by big banks and even the federal government and underfunding financial aid for eligible students has created the $1.3 trillion student loan debt crisis that is dragging down our economy. And legislators like Ron Johnson are standing in the way of fixing it.”