Senate Democrats are highlighting their efforts to avoid an increase in student loan interest rates over the recess as they look to position themselves against House Republicans who have proposed a different offset.
In a conference call today, Sen. Sherrod Brown (D-Ohio) argued that a bill approved by the Republican-run House last week would cost more money in the long run because it would seek to pay for the measure by eliminating a fund in the 2010 health care overhaul that covers prevention and public health. Both Senate Democrats and House Republicans are seeking a compromise to pay for the $6 billion cost of keeping Stafford loan interest rates at 3.4 percent.
“In the end, [the House measure] will cost taxpayers and insurance companies and individuals way more money” because preventative care is less costly than caring for individuals who have illnesses that could have been managed with preventative measures, Brown said.
The House approved the bill Friday by a vote of 215-195. The bill received 13 Democratic votes and all but 30 Republicans supported it.
The White House has threatened to veto the House bill, calling it a “politically motivated proposal and not the serious response that the problem facing America’s college students deserves.”
Next week, Senate Democrats will consider a bill that would prevent a doubling of the current 3.4 percent interest rate and cover the cost by eliminating a corporate tax loophole that allows wealthy individuals to pay less in Social Security and Medicare taxes.
Brown, a co-sponsor of the Senate bill, said he is encouraged that presumptive GOP presidential nominee Mitt Romney has indicated he, too, wants to keep the interest rate at 3.4 percent.
He pointed out that, as governor of Massachusetts, Romney embraced a similar offset to the one in the Democrats’ bill. Brown said he hopes that Romney’s past position can help influence Republicans, particularly in the Senate. Democrats, who control 53 votes in the Senate, will need at least seven Republicans to overcome a filibuster of their student loan bill.
“We know that Gov. Romney has said we should keep it at 3.4 [percent],” Brown said. “We know that Gov. Romney in the past has supported closing these tax loopholes ... as governor of Massachusetts and did some of that. He called it closing loopholes and not a tax increase.
“So we are hopeful that Gov. Romney can have the influence with the House Republicans and the Senate Republicans in getting cloture by doing this the right way. Not going after [health care] prevention.”
Sen. Patty Murray (Wash.), who runs the Democratic Senatorial Campaign Committee, also held an event today at the University of Washington.
“Unless Congress acts, interest rates for many here at @UW, & 100k+ across WA, will double on 7/1,” Murray said via Twitter.