The GOP offered two options to Democrats. The first, which Democrats said would be unacceptable, would offset the costs of the student loan bill with an increase to federal employee retirement contributions by 1.2 percent over three years.
The second option was a combination of three pay-fors: limiting the duration of borrowers’ in-school interest subsidy for Stafford loans, revising the Medicaid provider tax threshold and improving state and local pension collection information.
The GOP argued that all these were included in Obama’s 2013 budget proposal.
“While we still haven’t heard from the White House on our bipartisan proposal, we are encouraged to see the Majority Leader drop his insistence on taxing job creators,” a McConnell aide said.
Democrats have pushed for paying for the student loan bill by eliminating a corporate tax loophole that allows wealthy individuals to pay less in Social Security and Medicare taxes, which Republicans opposed.
“We will review these new proposals and hope that they will finally review the bipartisan proposals we sent a week ago,” the spokesman said. “But bottom line, now that Democrats are willing to take this issue seriously, and not just use students as props, we may be making progress.”
“And we were particularly surprised to see the Majority Leader acknowledge that forcing businesses to ‘redirect money away from job creation’ is bad for jobs,” the McConnell spokesman continued. “As tax hikes on job creators would certainly redirect funds from job creation, we hope that sentiment will continue and we renew our call for Democrats to join our effort to prevent the largest tax hike in American history.”
Vice President Joe Biden waits to conduct a mock swearing-in ceremony with Sen. Brian Schatz, D-Hawaii, in the Capitol's Old Senate Chamber, December 2, 2014. Schatz was sworn in to serve the remainder of his term since he was appointed to the seat after Sen. Daniel Inouye, D-Hawaii, passed away.