[Congressional Record Volume 141, Number 145 (Monday, September 18, 1995)]
[Senate]
[Page S13725]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




[[Page S 13725]]


                 THE REPUBLICAN RECONCILIATION PACKAGE

  Mr. PELL. Mr. President, in a statement on the Senate floor last 
week, I indicated I would oppose any reconciliation instructions that 
hurt students. I said it was time that we took students out of harm's 
way.
  Unfortunately, the reconciliation package we will consider on 
Wednesday does precisely the opposite. It harms students and their 
families. Three-quarters of the cuts in this package will be borne by 
students and their families.
  For the first time, institutions of higher education would be charged 
a fee of 2 percent of the total amount of money borrowed by students, 
and parents of students, at each institution. While this fee could not 
be directly passed on to students, institutions of higher education 
would have to find the money somewhere. I greatly fear that the result 
could be a reduction of institutional student aid, or cutbacks in 
educational programs and student support services. Clearly, a change of 
this magnitude harms students and their families.
  Increasing the interest rate on parents loans comes at a time when 
middle-income families are increasingly hard-pressed to make ends meet 
and help pay for their children's college education. This harms 
students and their families.
  Decreasing the interest subsidy during the grace period from 6 to 4 
months hits students when they have just finished their college 
education and are looking for a job. This harms students and their 
families.
  Capping the direct loan program at 30 percent ensures that no new 
schools will enter the program and that students at these institutions 
will not be able to benefit from this program. It also removes an 
incentive to improve the regular guaranteed loan program. Advancements 
such as improved services to the student and better, more favorable 
interest rates could well disappear. This would harm students and their 
families.
  The series of changes affecting lenders, holders, and guaranty 
agencies could well endanger the stability and viability of the current 
program. For instance, more lenders might leave the program. Thus, we 
could well have fewer lenders at a time when more are needed because of 
the proposed 30 percent cap on direct lending. This would jeopardize 
access to loans by all students, and would harm students and their 
families.
  I intend to oppose these instructions. To make such draconian changes 
just to save money is not, in my opinion, prudent public policy. It 
would be far better to put a tax cut in harm's way and to spare 
students.

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