Republicans demand action on student loan interest rates
July 6th, 2013
06:00 AM ET
10 months ago

Republicans demand action on student loan interest rates

(CNN) - Rep. Lynn Jenkins, R-Kansas, faulted Senate Democrats on Saturday for this week's hike in student loan interest rates and urged the upper chamber to pass legislation that resolves the issue as soon as the holiday recess ends.

"For too long, politicians have been in charge of setting these rates, and we keep coming back to cliffs and deadlines like this one," Jenkins said in the GOP weekly address. "Paying for college is difficult enough without all this uncertainty. I have two kids in college, I know how hard it can be."

The interest rates on some student loans officially doubled Monday - to 6.8% from 3.4% - after the Senate failed to reach a compromise by the July 1 deadline.

The hike hits about seven million new subsidized Stafford loans this year for middle- and low-income students, but does not apply to existing loans.

Negotiators are stuck largely on the question of whether to require an overall cap above which interest rates on new loans could not rise.

Top Senate Democrats want a cap in place to protect students if interest rates spike. That is at odds with the slightly different proposals from President Barack Obama and various congressional Republicans, which are tied to 10-year Treasury bond rates and would include charges for administrative costs but would not include caps.

Republicans, who prefer a more market-based approach, often point out that the White House's proposal falls more in line with their own.

"When President Obama proposed letting the markets set interest rates instead, the Republican-led House passed a bill reflecting his plan," Jenkins said. "Republicans in the Senate came to the table with similar ideas. Unfortunately, Senate Democrats attacked the president's plan, refused to work with us, and allowed this rate hike to take effect, leaving for the July 4th holiday without passing a solution."

Senators worked through last week to try to reach a deal, but lawmakers from both parties ultimately predicted an agreement would not be made in time.

Nevertheless, many of those same senators said they hope to finalize an agreement shortly after the break and have it apply retroactively so students are not hurt by the temporary hike.

Another disagreement centers on whether the legislation is revenue-neutral. Senate Democrats say the government should not earn any money or pay down the deficit from the loans they provide, something that would happen under the other proposals.

"Republicans continue to insist that we reduce the deficit on the backs of students and middle-class families," Adam Jentleson, a spokesman for Senate Majority Leader Harry Reid, said a week before the deadline.

– CNN's Ted Barrett and Ashley Killough contributed to this report.


Filed under: Congress • Education • Republicans
soundoff (540 Responses)
  1. Sparknut

    Republicans want the market to set the rate? My kids have non-subsidized loans and the rate is set by the market and they are paying 8 to 9 percent on their student loans. The students are being robbed by the lenders and the Republicans care nothing about that.

    July 6, 2013 03:32 pm at 3:32 pm |
  2. Larry Hoover

    it is in the best interest of America's future to make college affordable to qualified persons. they are our future leaders, investors and tax payers

    July 6, 2013 03:40 pm at 3:40 pm |
  3. hreidRacistMormonWimp

    As a lifelong democrat I can only wonder who much kinder the history books would be to the Obama presidency if he had the guts to push out that worthless racist Mormon wimp Harry Reid out of the leadership position he does not deserve. The guy is best there is at shooting democrats in the feet.

    July 6, 2013 03:40 pm at 3:40 pm |
  4. The Republicans R Traitors

    The only politician who has been trying to get the recalcitrant GOP muddafugging traitors to the table over the last 6 months over this issue has been Senator Al Franken. Not a peep from any of the treasonous TPGOP. Hang them all.

    July 6, 2013 03:41 pm at 3:41 pm |
  5. IvotedforObama

    No the racist GOP is all at fault. They hate a black president therefore they do what they can to hurt him.

    July 6, 2013 03:41 pm at 3:41 pm |
  6. The Republicans R Traitors

    Kill the republicans in the streets.

    July 6, 2013 03:42 pm at 3:42 pm |
  7. The Republicans R Traitors

    Grab the guns from the rabid gunnuts GOP and shoot them in the head.

    July 6, 2013 03:42 pm at 3:42 pm |
  8. The Republicans R Traitors

    Send a cruise missile into the next CPAC meeting.

    July 6, 2013 03:43 pm at 3:43 pm |
  9. George

    The GOP demands action! What a joke.

    July 6, 2013 03:48 pm at 3:48 pm |
  10. bilk7

    The GOP House are the ones who put forth a bill which could possibly MORE than double the current rates and THEY demand action??? Americans are not falling for this crap anymore!

    July 6, 2013 03:49 pm at 3:49 pm |
  11. VCMD

    Everyone should understand that we don't have money to subsidize education! Government can only help the students get a loan at cheapest rate possible and have some checks in place to protect students from bad lenders! Everyone taking a long should weight the cost of the loan over it's entire life and the return (income) they can generate through the education they are receiving to decide if the loans are good. Please note that universities charge insane amount for higher education from people who can afford (some via these loans) and they provide scholarships to people who are poor.

    July 6, 2013 03:51 pm at 3:51 pm |
  12. Thomas

    How much did Bush's wars cost ?

    July 6, 2013 03:54 pm at 3:54 pm |
  13. Ron L

    Once again we are being fed half-truths. The Republicans want the government to earn money on the student loans, the Democrats would like it to be revenue neutral. If the President does not agree with the concept the Democrats are promoting he is WRONG!! Plain and simple if our Government can loan money to the largest banks in America at 1% interest, why can't we help Americans attempting to better themselves at the same rate or lower??? We are constantly being told how important college degrees are to the advancement of the nation, but the tuitions go up 3 times the inflation rate annually and the government wants to make money on the loans. All this will lead to is fewer and fewer Americans being able to afford the very thing they need the most to have a chance to achieve the American dream we so often brag about.

    July 6, 2013 03:56 pm at 3:56 pm |
  14. Paul

    GOP has short memories. Obama and dems were the ones that originally lowered the student rates. They are the masters of hypocracy and once again are talking out of the side of their mouth. Based on past GOP politics, they probably included an amendment that said "all loan recipients must vote for republicans" and then complain if the Dems don't agree.

    July 6, 2013 03:59 pm at 3:59 pm |
  15. jboh

    Sorry TEA/GOP, only your stooges believe that one.

    July 6, 2013 04:07 pm at 4:07 pm |
  16. SFRich

    Oh, how sweet. The GOP is pretending to care about people who have to borrow money to go to college.

    July 6, 2013 04:21 pm at 4:21 pm |
  17. matt

    Sounds about right. Democrats are only concerned with giving more perks to low-class minorities so they'll be content to be poor.

    July 6, 2013 04:26 pm at 4:26 pm |
  18. allens

    the second most hated and useless bunch behind congress. they do not represent the people, just politics as usual

    July 6, 2013 04:27 pm at 4:27 pm |
  19. I AM

    More double talk from the Republicans.....they say nothing while talking all the time !

    July 6, 2013 04:27 pm at 4:27 pm |
  20. Sylvia

    Can anyone name one thing that the republican party has proposed to help poor or middle class americans? You won't be able to come up with anything. They propose legislation all the time to help rich people but never to help the poor or middle class. People need to start pointing this out.

    July 6, 2013 04:30 pm at 4:30 pm |
  21. Anonymous1

    Screw you Republicans, like you've been screwing the rest of us.

    July 6, 2013 04:31 pm at 4:31 pm |
  22. Anonymous

    WHat a joke the House republicans voted unanimously for their budget that raised the rates permanently. To now say they wanted to lower them is not honest in any way

    July 6, 2013 04:33 pm at 4:33 pm |
  23. jane

    @reocnmarine: Republicans don't care about Student Loans. They are more concerned about ABORTION for women. They have had numerous Jobs Bills from the Senate over the last 2.5 years and won't even bring them up for a vote. However, they Have passed over 38 bills trying to overturn the Affordable Care Act (a law, not a bill anymore). There, I fixed this for you.....

    July 6, 2013 04:37 pm at 4:37 pm |
  24. No A Chance

    Nice try, lady. The country is on to the GOP's obstruction. This ruse will be filed under "Too little, too late."

    July 6, 2013 04:39 pm at 4:39 pm |
  25. Q-Tip

    America is divisive. The line has been drawn...either you're a D or a R. At this point in America it would take a miracle to get anything done since we're so damn divisive. Reading these comments you can tell how bad the division is. Bloggers aligning with D's condemning R's. Bloggers aligning with the R's throwing barbs back at the D's and blaming them. All the blaming and name calling. And the people at the top continue to sit on their thrones watching us peons bicker. What a shame.

    July 6, 2013 04:44 pm at 4:44 pm |
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