[Congressional Record Volume 141, Number 57 (Tuesday, March 28, 1995)]
[House]
[Pages H3814-H3815]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


                     POTENTIAL CUT IN STUDENT LOANS

  The SPEAKER pro tempore. Under the Speaker's announced policy of 
January 4, 1995, the gentleman from West Virginia [Mr. Wise] is 
recognized during morning business for 5 minutes.
  Mr. WISE. Mr. Speaker, my message today goes out to college students, 
their parents, educators across our country and across the State of 
West Virginia.
  Last month, we had to fight the battle of school lunches and, 
incredibly enough, unbelievably, there was actually a proposal and it 
passed on the floor of the House to eliminate the school lunch as we 
know it. And this involved parents and educators and school children 
across our country.
  This month, I am warning people in advance. You had better be 
fighting for your student loan, your guaranteed student loans that 
keeps you in college, the one that the Federal Government helps 
subsidize your education knowing that that small amount of subsidy is 
going to be repaid time after time and time again in increased earnings 
and increased tax revenues. Because, yes, incredibly enough, under the 
Contract With America this, too, is at risk.
  Last month, the school lunch; this month, the school loan.
  So we are going to see probably the school loans cut. Because why 
would the student loans be cut? They would be cut for a tax cut. They 
call it a middle income tax cut.
  And if you earn over $100,000 a year, yes, it is a tax cut for you. 
If you are below $30,000 a year, you are going to see almost nothing. 
If you are below $13,000 a year, you are going to see nothing at all.
  So what we are going to see is that middle-income people are going to 
see their student loans cut so that the upper incomes can have their 
taxes cut. It does not sound like a good deal to me.
  So when those students this month take their final exams, be careful. 
They could be more final than you think. When school lets out this 
summer, let us hope that they are not letting out for good.
  So I am calling on students across our State and across the country 
to mobilize, to say, ``No. Enough is enough. This is a growth. Those 
loans are growth. They are not simply deficit spending.''
  The changes that have been proposed and talked about could cost as 
much as $20 billion over 5 years. The most important one is the 
interest subsidy that goes to children below a certain income level by 
which while they are in college the Federal Government pays their 
interest rate. Once they are out of college, then they are responsible 
for repaying that rate. It is estimated that eliminating that subsidy 
could cost students anywhere from 20 to 50 percent more on the cost of 
their loans.
  Now, like a lot of people in this country, I worked my way through 
school. I had to work my way through college, and I had to work at the 
same time. If you saddled me at the time with an 8 or 9 percent 
interest rate, I could not have made it; and a lot of others I think 
are in my situation as well. So this is penny wise and pound foolish.
  Many of our veterans remember that the single greatest economic 
accelerator was following World War II when this country put money into 
the GI Bill of Rights and sent millions to college. What we saw was an 
explosion of technology, of growth, of development, particularly in our 
economy, and so this would be.
  What the Contract With America puts at risk is the Stafford loan 
program, the work study program, supplemental education opportunity 
grants, the Perkins loan program; all on the chopping block.
  The impact on West Virginia would be severe. Thirty-five thousand 
students alone in our State have these subsidized loans by which the 
Federal Government is assisting to pay the interest while they are in 
college. That calculates to about $11 million annually in interest. Yet 
that $11 million could jeopardize the college careers and future 
careers of many of our West Virginia students.
  Already, West Virginia colleges are well aware of the impact if these 
kinds of cuts should pass this Congress. As I had one college president 
tell me, ``It is going to make the difference in our college as to 
whether many of our students can attend or whether they are not going 
to be able to attend.''
  Mr. Speaker, are we really going to cut the future off for many of 
our students like this? Middle-income parents, middle-income students 
need to be aware of what is out there, need to be aware that they have 
to mobilize and the time is short.
  Because when this tax cut package hits the floor next week, and I 
presume it is going to pass and get muscled through like everything 
else has been muscled through the last 100 days, when this tax cut 
package passes, they are not going to tell you what the cuts are. But 
the cuts come right after that, and those cuts are going to involve 
student loans as sure as I am sitting here.
  Nobody would believe that they would go after student lunches. They 
did. Now they are going after student loans. It is time to mobilize. 
Time to make ourselves heard. It is time to let the word go out: We 
want the country to grow.
  One of the single greatest accelerators and one of the single 
greatest 
[[Page H3815]] growth initiatives for my State of West Virginia as well 
as the Nation has been the student loan program. We want more students 
in higher education, not less. We want more students about to 
contribute to the economy, not less.
  Mr. Speaker, what most middle-income people say they would like more 
than a tax cut that basically goes to the upper-income people, they 
want deficit reduction, yes, but, more importantly, they want the 
chance for their students, their young people, their children, to 
improve and to have a chance and a start in this life.


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