Republicans demand action on student loan interest rates
July 6th, 2013
06:00 AM ET
5 years 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. jrumor

    charge the same interest to students as they do banks... if that is too low, charge them the identical amount.

    6.8% is a bad loan rate, and the feds should not be making money off of students who need loans to get an education.

    July 6, 2013 06:22 pm at 6:22 pm |
  2. Guest

    I paid back my college loans and they were 6-7,5%. Why can't the kids of today pay their fair share.

    July 6, 2013 06:29 pm at 6:29 pm |
  3. no

    both parties are only interested in keeping the working poor (thats you and me) poor and uneducated slaves to their masters in the Banks and Federal Reserve.

    July 6, 2013 06:33 pm at 6:33 pm |
  4. Dizzyd

    How about making sure college grads can actually GET jobs once they get out that don't require at least 2 yrs experience to START so they CAN pay back the loans?

    July 6, 2013 06:34 pm at 6:34 pm |
  5. Dastreagus Letobeiter

    I hope the congress will pass the new student loan bankruptcy act in exactly 3 years from august 23rd.

    July 6, 2013 06:39 pm at 6:39 pm |
  6. Jerry

    At this point I'd like to just be able to deduct student loan interest if you do Married Filing Separately on taxes. Why do you only get it if you file jointly? Makes no sense! And that's a $2500 deduction gone!

    July 6, 2013 06:42 pm at 6:42 pm |
  7. ray

    Everyone does not need to go to college. The government should get out of the student loan business. The demand would decrease along with diploma mills.

    July 6, 2013 06:49 pm at 6:49 pm |
  8. James

    The GOP isn't done insulting the intelligence of the citizenry of The United States. Maybe they will one day wake up and realize that to be legitimate like they used to be they need to do something positive and not just lie about doing as nothing as possible while whining about everyone else!

    July 6, 2013 06:59 pm at 6:59 pm |
  9. eleanor

    So the Republicans want action on student loans! I thought they were all brain dead, but here they are wanting action on student loans. You can be sure it won't be action that will do the students any good. Somebody has a plan to profiteer! They should go back into their stupor. They are more productive that way!

    July 6, 2013 07:01 pm at 7:01 pm |
  10. Jasmine Lindros

    Is Lynn Jenkins the new Sarah Palin? Let me see if I get this right – Democrats want a cap on interest rates, which will decrease the profit from these loans but help the students pay off those loans. Republicans refused to minimize profits and help students, so it's the Democrats' fault that the interest rate doubled. Can anyone explain this hypocrisy to me while keeping a straight face?

    July 6, 2013 07:02 pm at 7:02 pm |
  11. xfiler93

    The DEAR LEADER blasted the Repubs last year and now, he is silent as the rates double!! LOL funny

    July 6, 2013 07:02 pm at 7:02 pm |

    There have been all these complaints about our youth failing to commit themselves to education. The failure has come at the hand of illustious lawmakers. They have made it next to impossible for the common man to afford college for their children and when the student tries to do it on his own, he / she is kicked in the because of the lack of affordability. This issue, just like all others now, is a matter of the haves and have nots. The former doesn't have to worry about it because mommy and daddy can take care of it for them. But those who yearn to make a better way are frozen out as usual. You people up in DC better smarten up. This is our countrys future we are talking about. A lot of you so called lawmakers are getting old and on the way out. You claim to be so concerned about the welfare of the people. Well, it's time to back up those hollow words and give everyone who wants it a chance.

    July 6, 2013 07:02 pm at 7:02 pm |
  13. hkirwin

    Same excuses, same talking poits. I wish the Repubs would have stood in the way of ObamaCare. Opps, I forgot, they did, see how well taht worked.

    July 6, 2013 07:03 pm at 7:03 pm |
  14. MIchael

    Give it up GOP. No one is buying what you're peddling.

    July 6, 2013 07:05 pm at 7:05 pm |
  15. basketville

    They should change the law so veterans who served their country don't pay any interest on their loans- we put ourselves in harms way and risk our lives for this country – and yet I still have 60 grand to pay back – with no job and being disabled- I have no chance at paying these loans. The congressmen and women don't have to pay their kids loans- they get free education – so this is absurd. They don't care- it's just a political move.

    July 6, 2013 07:15 pm at 7:15 pm |
  16. sbreexy

    oh really? maybe the GOP should send a page to go find john boehner on the golf course and inform him that the speaker of the house is tasked to perform government functions in addition to renaming post offices. Our government is absolutely broken and we need to CLEAN HOUSE next year

    July 6, 2013 07:17 pm at 7:17 pm |
  17. OldSchool

    HAHA so essentially they are crying foul about the Democrats while the Democrats are actually the ones who are proposing the best solution for students?

    July 6, 2013 07:21 pm at 7:21 pm |
  18. John

    Hmmm, I seem to remember this bit about student loans having come up before as part of the budget and the GOP screamed "no no NO" while using it as one facile "reason" to kill said budget. Now they're suddenly trying to insist it
    Gee... sounds like the GOP thinks its fine when they demand "all or nothing" but if someone else uses that same method they get all righteous.

    Here is a cue for the GOP. Shut up. People are sick of your two-faced whining, crying about how its unfair when someone takes a page right out of your book and uses against you, and its not winning you any votes outside of the "safe" districts. Maybe we'll look at you as more than whiny brats with trust funds and bibles when you actually learn what compromise means and don't back out of every deal as soon as some wing-nut ultraconservative on Faux News throws a fit.

    July 6, 2013 07:22 pm at 7:22 pm |
  19. belinda

    I I totally support Democratic efforts to do this the right way. Republicans have a lot of nerve blaming this on them. They stole the right for students to get their PHD's. That's only for the rich now. I'm sure Karl Rove was behind that one. He stated that it was people with PHD's that are mainly liberals. An uneducated public is a good thing, Rove stated, they support the GOP. No wonder they are out to destroy education. They should go back and get their stories straight. It's a con job again. Same old story.

    July 6, 2013 07:29 pm at 7:29 pm |
  20. Bill rogers

    Student loan interest is deductible for incomes above $60,000 with a maximum deduction of $2500 in interest per year.

    July 6, 2013 07:31 pm at 7:31 pm |
  21. Anonymous

    Reading these comments makes me hate this country

    July 6, 2013 07:35 pm at 7:35 pm |
  22. KSU Grad

    I don't see why people can't pay for their own educations up front. Problem solved.

    July 6, 2013 07:43 pm at 7:43 pm |
  23. michael

    LOL! Are the GOP for serious?! THEY were the obstruction in addressing the issue. THEY were the ones that told Obama to "stick it."

    How pathetic.

    The GOP has NO chance of EVER regaining credibility, support and a majority. The GOP is rapidly becoming non-relevant.

    Just pathetic.

    July 6, 2013 07:49 pm at 7:49 pm |
  24. California

    Democrats ONLY do what they benefit off of.

    July 6, 2013 07:51 pm at 7:51 pm |
  25. nytw

    Any RINO that votes to continue Obama's stimulus plan needs to resign from office because they are no longer representing Real Conservative Americans.

    July 6, 2013 07:54 pm at 7:54 pm |
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