Don't Double Student Loan Interest Rates
In coming weeks, the Congress must seize the opportunity to invest in college affordability. Currently, subsidized Stafford loans have an interest rate of 3.4 percent. If Congress does nothing, this rate will double to 6.8 percent in July of this year. I have heard from people across Connecticut who are already struggling to pay off their student loans. Now more than $1 trillion, student loans have risen to the highest point in history – now higher than any other form of debt.
An increased interest rate would only intensify this disaster. The majority of Connecticut graduates in 2010 left college with student loan debt. This challenge affects millions of people across the country, as the amount of student loan debt in American is now significantly higher even than credit card debt.
This past week, the Senate began a crucial debate as to how to make college more accessible and affordable. On Tuesday, the Senate faced a critical procedural vote to take up the issue of freezing federal student loan interest rates at 3.4 percent, avoiding this significant rate increase in July. To pay for this measure, the bill would close the so-called Gingrich-Edwards loophole, which enables the richest Americans to shield their salaries from taxes by calling themselves small businesses. Closing the loophole would produce billions of dollars – which should be invested in Stafford student loans. The alternative measure adopted by the House of Representatives would decimate the Prevention and Public Health fund, which supports prevention efforts that significantly reduce our nation’s rate of infant death, cancer, diabetes, heart disease, and tobacco use. It presents a false choice – namely between accessible higher education, and improved public health. We can and must do both: our long-term economy, and as a result, the federal budget, will benefit if both of these goals are preserved. My hope is that the next vote will enable us to move forward on a bipartisan basis despite the negative vote Tuesday. There should be nothing contentious or partisan about providing affordable college education.
I encourage you to speak out in favor of freezing the student loan interest rate at its present 3.4 percent and investing in public health. Ask Congress not to double the Stafford loan interest rate, and do all that you can to support this critical measure.