Senate Majority Leader Harry Reid has proposed a way to pay to keep student loan interest rates at their current rates, but the plan seems stalled, as does the GOP proposal.
Congress has two weeks to reach a deal to prevent student loan interest rates from doubling, and while both parties agree it’s good policy to keep rates low, it seems that at this point they also think it’s better politics to make the other side look responsible for failure.
Republican leaders have made an offer to Democrats. Senate Majority Leader Harry Reid (D-Nev.) has made an offer to Republicans. Both offers came in the form of letters, issued weeks apart, and neither side has yet moved to kick off formal talks on the proposed frameworks. Even more telling has been the virtual silence from the White House.
Although President Barack Obama is regularly incorporating talking points on student loans in his stump speeches on the road, the administration has not been leaning on Congress through internal channels, according to multiple sources in both parties. And with the significant overlap in parts of the plans offered by Congressional Republicans and Democrats, it seems the one missing ingredient is pressure from across Pennsylvania Avenue to force everyone’s hand.
“If the White House is concerned that we’re headed for a meltdown, they certainly have a funny way of showing it. They’ve never even called to discuss the topic,” said one senior Senate Republican aide.
The current student loan interest rate is set to double from 3.4 percent to 6.8 percent on July 1. The hang-up in Congress has been over how to pay for the nearly $6 billion extension of current interest rates.
Both Obama and presumptive GOP presidential nominee Mitt Romney have endorsed a continuation of the current rates, which should be enough political juice to get Congress going. But to date, the two sides have enjoyed playing football with the issue, hoping that whoever is holding the ball when time expires can be blamed for the rate hike that would affect the more than 7 million undergraduate students who use the loan program to pay their way through school.
And the rate hike wouldn’t be the first hit to students leveled by this Congress. As it stands, the Budget Control Act of 2011 already eliminated subsidized Stafford loans for graduate students.
In an offer made late last month, Speaker John Boehner (R-Ohio), House Majority Leader Eric Cantor (R-Va.), Senate Minority Leader Mitch McConnell (R-Ky.) and Senate Minority Whip Jon Kyl (R-Ariz.) outlined two proposed offsets. One included Medicaid changes that would be unacceptable to Democrats. But the other alternative seemed to provide enough room for compromise for Democrats to work with.
The Republicans offered an increase in current employee contributions to the Civil Service Retirement System over the next three years to offset the cost.
Each year since 1990, CQ Roll Call has reviewed the financial disclosures of all 541 senators, representatives and delegates to determine the 50 richest members of Congress. This year's report, derived from forms covering the calendar year 2012, shows it took a net worth of $6.67 million to crack the exclusive club.