If you hear the liberal lie that the Republicans are not in favor of keeping student loans low, read this for the facts.http://online.wsj.com/article/SB10001424052702303665904577452483587070336.html?KEYWORDS=student+loans
The Politics of Student Loans By ALLYSIA FINLEY, June 12, 2012
While visiting the University of Nevada, Las Vegas, last week, President Obama warned that student loan interest rates could double next month if Congress doesn't act fast. There he goes again.
In 2007 Congress reduced interest rates on subsidized Stafford loans to 3.4% from 6.8%. The lower rates, which were phased in over five years, expire at the end of this month. Mr. Obama wants to extend the below-market rates at an annual cost of $6 billion to taxpayers. Since Republicans don't want to alienate young voters, they've agreed to extend the rates temporarily in return for spending offsets.
The president, however, has rejected all of the GOP's proposed offsets even though he's suggested many of them in the past. Democrats would rather continue whacking Republicans over the issue until November. So a-whacking they go.
If the president is intent on blowing up the issue, Republicans would do well to point out that the primary beneficiaries of an extension would be this year's college freshmen and high school seniors—who will be voting in their first presidential election this fall—not those who have already graduated and can't find jobs. In fact, those who graduated in 2009 and 2010 (and borrowed before the ultra-low rates took effect) are paying an average rate of about six percent. So much for "fairness."
Perhaps the president expects the job market to worsen in the years ahead and wants to cushion the blow for future grads. More likely, he believes that bludgeoning Republicans on an issue that's near and dear to students' pocketbooks will help drive young people to the polls this November. While Republicans understandably don't want to give Democrats any ammo during an election year, there's never a politically opportune time to cut subsidies or entitlements.
And if Republicans are afraid of addressing a relatively small entitlement like student loans, will they ever muster the courage to tackle Social Security and Medicare, which would pit them against more significant constituency groups?http://blogs.wsj.com/washwire/2012/06/08/glimmer-of-hope-for-student-loan-compromise/
By Janet Hook, June 8, 2012,
Even as Congress is mired in stalemate on issues from taxes to highway funding, Democrats and Republicans in Congress are quietly edging closer to a compromise on legislation to block an increase in student loan rates.
Republicans in the Senate are encouraged by a new proposal from Senate Majority Leader Harry Reid (D., Nev.) for covering the cost of the student loan bill – an alternative to an earlier Democratic tax increase that the GOP had rejected out of hand.
Rep. George Miller (D., Calif.), ranking Democrat on the House Committee on Education and the Workforce, said Friday that he considered the Reid proposal a “serious” effort at compromise that made it more likely the stalemate would be broken before July 1, when student-loan interest rates are scheduled to double to 6.8% if Congress does not act.
Republicans were low key in their response to the proposal , unveiled by Mr. Reid Thursday, but in the current partisan climate on Capitol Hill the absence of rancor was seen as an encouraging sign of growing trust between the parties.
At issue is legislation that extends for one year the current 3.4% interest rate on federal student loans. President Barack Obama has campaigned hard for the extension, making it a cornerstone of his appeal to young voters in his reelection bid. GOP presidential candidate Mitt Romney and Republican leaders in Congress have agreed to freeze the loan rate, but the bill to do so has stalled for weeks because the two parties have disagreed over how to cover the $5.9 billion cost of the bill. Republicans proposed to cut spending from part of Mr. Obama’s signature health care law; Democrats proposed closing a loophole that allowed some wealthy individuals to escape paying Medicare and Social Security taxes.
Republicans offered alternative financing proposals last week in a letter to Mr. Obama, but received no response from the White House or congressional Democrats – until Thursday when Mr. Reid countered with his alternative offset proposal. He dropped the tax-loophole-closer and instead proposed raising the premiums employers pay for insurance provided by the Pension Benefit Guarantee Corp. Mr. Reid also would ease pension-funding requirements for companies, which would raise revenues because companies would then take fewer tax breaks for pension contributions.
Don Stewart, a spokesman for Senate Minority Leader Mitch McConnell (R., Ky.), would say only that Republicans would review the proposals, but added, “Now that Democrats are willing to take this issue seriously, and not just use students as props, we may be making progress.”
Said Rep. John Kline (R.,Minn.), chairman of the House Committee on Education and the Workforce, “I am encouraged by Senator Reid’s willingness to offer a new proposal to pay for an extension of the lower rate and look forward to considering it when it has been approved by the Senate.”