[Congressional Record Volume 159, Number 97 (Tuesday, July 9, 2013)]
[Senate]
[Pages S5531-S5537]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
KEEP STUDENT LOANS AFFORDABLE ACT OF 2013--MOTION TO PROCEED
Mr. REID. I move to proceed to Calendar No. 124, S. 1238, Senator
Reed's student loan bill.
The ACTING PRESIDENT pro tempore. The clerk will report the bill by
title.
The legislative clerk read as follows:
A bill (S. 1238) to amend the Higher Education Act of 1965
to extend the current reduced interest rate for undergraduate
Federal Direct Stafford Loans for 1 year, to modify required
distribution rules for pension plans, and for other purposes.
Schedule
Mr. REID. Madam President, following my remarks and those of my
Republican counterpart, the time until 11 a.m. will be equally divided
and controlled, with the majority controlling the first half and the
Republicans controlling the final half.
At 11 a.m. the Senate will proceed to executive session to consider
the nomination of Jennifer Dorsey to be U.S. district judge for the
District of Nevada. At noon there will be a rollcall vote on
confirmation of the Dorsey nomination. I would add that the chairman of
the Judiciary Committee has asked that we hold that vote open until
12:30 p.m. today because they are having a confirmation hearing on the
new Director of the FBI, Mr. Comey. We will do that, and the vote will
end at 12:30 p.m. rather than 12:15 p.m. or 12:20 p.m.
Following that vote, the Senate will recess from 12:30 p.m. to 2:15
p.m. for our weekly caucus meetings.
In America, this great country of ours, a quality education is the
surest path to the American dream. When I was a boy, we always looked
at that American dream as getting a college education, which, from
where I came from, wasn't going to happen very often. Now the American
dream is more than just getting an associate's degree or a bachelor's
degree. It involves many other occupations, all of the things available
in health care now, such as nursing, nursing assistants, all of the
technicians, the people who do physical therapy--not physical
therapists but people who help doctors do what they need to do. We have
programs to become a physician's assistant. There are many programs
that are important to be able to fulfill that American dream. There are
all different kinds of programs for computer training separate and
apart from getting a bachelor's degree. Those programs are extremely
important. The reason they are important is we as Americans have
decided that with the cost of education skyrocketing as it is, students
should get some help, whether they are seeking a degree in engineering
or getting into a program to begin some computer training to have jobs
they want for the rest of their lives.
College has never been more expensive and further out of reach for
American families. That is why it is critical that we keep interest
rates low on Federal student loans so more promising students can
realize their dream of an education.
Last month Republicans rejected the Democrats' plan to freeze student
loan interest rates at current levels for 2 years without adding a
penny to the deficit. Because of this obstruction, loan rates doubled
on July 1, piling thousands of dollars more on debt that more than 7
million students owe. Republicans are instead pushing a plan to balance
the budget on the backs of struggling students. But if either the
legislation passed by House Republicans or the plan proposed by Senate
Republicans becomes law, student loan rates will more than double over
the
[[Page S5532]]
next few years as interest rates increase.
Speaker Boehner says that the House has acted and now the ball is in
the Senate's court. We talked about that yesterday. What is he talking
about--they have acted and now we should act? I guess we could talk
about what they didn't do last year on the farm bill. I guess we could
talk about what they didn't do last year on post offices. I guess we
could talk about what they haven't done this year on the farm bill. We
could talk about what they haven't done that is so devastating to small
businesses around America, and that is having people who are online and
don't build a single building, rent a single building--they get a
different rate of return than do those in brick-and-mortar buildings.
They do that because they don't have to pay sales tax. We could talk
about why the Speaker is refusing to take up something that is
meaningful.
As I say about this student loan issue--and I just had a meeting that
ended a few minutes ago--if you can explain to me why these proposals
the Republicans have are better than just having the rates double,
please do that. But they go into all these gyrations about whether it
is a T-bill, overnight T-bill, or 30 days or 6 months or--all this
complicated stuff, and it is factual. I met with someone from the White
House. I said, OK, tell me what happens in 3 years. The response was,
oh, well, the rates will be above 6.8 percent. That is appalling. If
someone can show me how all these programs they are coming up with are
better than just letting things double, tell me.
We have a better proposal. Instead of pushing a plan to balance the
budget on the backs of struggling students, I think we should support a
plan that would be better for students, not worse for students. I
repeat, we can't support a plan that would be worse for students than
doing nothing at all.
They have to take action. The rising price of higher education means
too many young people are deferring higher education. I hear all the
stories. College education used to be cheaper. Well, because of what
has happened here in Washington with the obstruction, we have to help
people. There has been less support of higher education from the
States. Tuition costs have risen significantly because of this.
Students need help. We have to take action. The rising price of higher
education means too many young people are deferring higher education,
and it has saddled many who do get a degree with unsustainable debt--
debt that causes them to delay buying their first home, having
children, or starting a business. Americans have more than $1 trillion
in student loan debt. The average graduate owes more than $25,000. In
fact, Americans have more student loan debt than credit card debt. They
simply can't afford to pile on even more.
We are going to continue to fight to keep the student loan rates low
and hold back the rising price of education. Tomorrow the Senate will
vote on whether to even begin debate on our plan to keep loan rates low
for an additional year.
I very much admire the work done by Senator Stabenow, the chairman of
the Agriculture Committee. She is someone who is very effective in
conveying a message. She has led the message for Democrats as to why we
shouldn't let these rates double, and she will continue to do that.
As I indicated earlier, we made a proposal to keep rates where they
are for 2 years. We have made changes to our proposal in an effort to
meet Republicans in the middle while protecting students. Our plan
shortens the extension from 2 years to 1 year, and it doesn't add a
penny to the debt.
I spoke with the chairman of the Finance Committee today. I said:
Max, explain how we are paying for this. It is so simple. It is
inherited IRAs, that people would pay after 5 years--they wouldn't get
the tax deduction after 5 years. What our program does is it closes
this obscure tax loophole that allows a few very wealthy individuals to
avoid paying taxes on inherited retirement accounts. This is why
Senator Baucus came up with this as a pay-for.
So I hope Senate Republicans won't block a second commonsense plan in
investing in our economy by keeping college affordable. We have reduced
it to 1 year from 2 years. It would be great if we had a long-term
solution to this, but we can't do something that hurts students very
quickly. Some have said: Well, it is going to be for a year or two, and
there will be lower interest rates. Yes, but after that it will be
``Katy, bar the door.'' We all know interest rates are going to go up.
Dorsey Nomination
Before the lunch, as I have indicated, we will consider the
nomination of Jennifer Dorsey to be U.S. district judge for the
District of Nevada. She will be a valuable addition to the Federal
court system. She is a Las Vegas native. Her father was stationed at
Nellis Air Force Base and after Vietnam decided that was where he
wanted to make his home. He started his family there.
Ms. Dorsey graduated from Chaparral High School and graduated cum
laude from the University of Nevada, Las Vegas. She was also the first
member of her family to graduate from college. She served as a
congressional intern for my friend and former colleague Senator Richard
Bryan. She attended Pepperdine University School of Law, where she was
a member of the Pepperdine Law Review.
After graduation she returned to Las Vegas and excelled, first as an
associate and now as a partner, at the firm Kemp, Jones & Coulthard, a
longtime brave, proud Nevada law firm. She is the first and only female
partner in that firm. She specialized in civil litigation, complex
commercial disputes, appeals, and class actions.
I am very impressed with her dedication to the State of Nevada, her
community, and the legal profession. She will make an outstanding
Federal judge for Nevada. I look forward to her confirmation.
Recognition of the Minority Leader
The ACTING PRESIDENT pro tempore. The Republican leader is
recognized.
Standing for Democratic Rights
Mr. McCONNELL. Over the years we have seen repeated instances of
indifference to the rule of law on the part of this administration. It
is a consistent and worrisome path. The most recent example, of course,
was last week's announcement that the President had simply decided not
to enforce a major piece of his health care law--that is, until after
the midterm election. What the President was saying in effect was that
if he doesn't want to implement the law he has signed, he doesn't have
to.
I agree it is a terrible law. I understand why people harmed by it
would want it changed. In fact, I think we ought to repeal it
altogether and opt instead for real reforms that actually would lower
costs. But the fact is--for now, at least--it is the law and it is the
President's constitutional duty to enforce the law. Yet, instead of
fulfilling this basic duty of his office, the President seems to
believe he gets to decide who is subject to the law. He gets to decide
who is subject to the law and who gets a pass. So last week businesses
had their ObamaCare sentences delayed. Maybe next week it will be some
other group, but it is his call. He will decide what the law is. He did
it with immigration, he did it with welfare work requirements, and he
did it with the NLRB when he took it upon himself to tell another
branch of government when it was in recess. He is doing it again with
his own signature health care law.
Imagine that the current occupant of the White House was not
President Obama but a Republican. Imagine that. Pretend that this
Republican had come to office promising an era of inclusion and
accountability, but as the years wore on he simply had grown tired of
the democratic process.
Imagine that this President, despite securing confirmation for nearly
every nominee he submitted, couldn't understand why the elected Senate
didn't simply rush them all through even quicker. He couldn't
understand why Senators insisted on fulfilling their constitutional
obligations to scrutinize each nominee.
Visualize for a moment that this President decided to urge Members of
his party to break the rules of the Senate so that he could appoint
whomever he wanted regardless of checks and balances. Imagine the
outrage in the media, online, and especially on the other side of the
aisle. They would claim the President was a dictator. They would say he
was ripping the Constitution to shreds, basically everything they said
for so many years
[[Page S5533]]
about President Bush. But, of course, President Obama isn't a
Republican, and so Washington Democrats seem just fine with it. In
fact, it appears they are even ready to help this President--actually
help him--in his partisan power grab.
I know Washington Democrats are getting a lot of pressure from big
labor bosses and from other far-left elements of their base to do this.
These folks have told Democrats it is time to pay up, and they do not
have much time for things such as the democratic process or the rule of
law. They have raised a ton of money for the Democrats and now they
want the special interest treatment they believe is owed to them. That
is why we see the other side cooking up phony nomination fights. They
are cooking up a phony nomination fight because they want to go
nuclear, but they know the facts simply aren't on their side to justify
doing so. They know their core argument, that President Obama's
nominees are being treated less fairly than those of President Bush, is
essentially at odds with reality. It is a complete fiction. They have
gotten burned by the fact checkers already. President Obama's nominees
for Secretary of Transportation and Energy were unanimously confirmed.
Secretary of State? Confirmed. Treasury? Confirmed. Interior, Defense,
Commerce? Check, check, check.
Already in this Congress the Senate has approved 27 of President
Obama's lifetime appointments. That compares to just 10 at a comparable
period in President Bush's second term. And, by the way, my party
controlled the Senate at this point in President Bush's second term. He
got 10, President Obama has 27. In other words, President Obama has
just settled back into office and already he has secured nearly three
times--three times--more comparable judicial confirmations.
Look, to justify doing something as extreme as the left wants, you
better be prepared to make a rock-solid case, and this is the best they
can come up with, that we need to change the rules of the Senate
because big labor bosses say so; that the left should be allowed to
fundamentally change our democracy because the President is only
getting nearly everything he wants--nearly everything he wants--rather
than everything he wants at the exact moment he wants it? Let's get
real here. This is not how a democracy functions.
If this were a Republican President and the shoe were on the other
foot, does anyone seriously believe Washington Democrats would be going
along with something so utterly preposterous? Of course not. Remember,
the current majority leader once said the nuclear option would ``ruin
our country.'' That was said by the fellow who sits right over here,
the current majority leader of the Senate. And a former Senator from
Illinois named Obama said if the Senate broke the rules to change the
rules ``the fighting, the bitterness and the gridlock [would] only get
worse.'' Boy, he was right about that.
What I am saying to President Obama and his friends on the far left
is this: The facts show you are getting treated pretty darn well on
nominations as it is. But if you would like more confirmed, if, for
instance, you want the Senate to confirm your nominees to the NLRB,
then don't send us nominees who have already been declared illegal by
the courts. We have already said that is not going to happen. You know
you can't look Americans in the eye and say you would vote for such a
thing if you were in the minority so don't expect us to. But if you
send us fresh picks, we will happily give them a fair hearing, just as
we have been doing all along with all of the rest of the President's
nominees. Almost all of them have been confirmed. Most have been
confirmed almost unanimously, because we in America know that
majorities of either party will never get absolutely everything they
want. That push and pull is the hallmark of a healthy democracy. And
one day--maybe not in the too-distant future--when our Democratic
friends in the majority are invariably returned to the minority, they
will thank us for standing up for those democratic rights.
Madam President, I yield the floor.
Reservation of Leader Time
The ACTING PRESIDENT pro tempore. Under the previous order, the
leadership time is reserved.
Order of Procedure
The ACTING PRESIDENT pro tempore. Under the previous order, the time
until 11 a.m. will be equally divided and controlled between the two
leaders or their designees, with Senators permitted to speak for up to
10 minutes each, with the majority controlling the first half.
The Senator from Michigan.
Ms. STABENOW. Madam President, I rise today because tomorrow in the
Senate Chamber we will vote on whether to let student interest rates
double from 3.4 percent to 6.8 percent. This should not be
controversial. This should have been done before July 1. Now we are
trying to retroactively fix this.
We have attempted to bring this to the floor and vote on it before on
a number of occasions. We have seen a Republican filibuster blocking us
from doing that. This week I am hopeful we can get the necessary
bipartisan vote to overcome the filibuster and be able to send a very
strong message to students across the country that we understand this
is a huge issue for them and their families, a huge cost, and that
raising the rates will only be another barrier to creating opportunity
for students in the future and, frankly, having a middle class in this
country.
What is happening to the students and the debt involved is very
serious, and it is stopping many young people from being able to move
ahead and achieve their dreams. At a time when interest rates for
everything else are at historic lows, why in the world would we double
the interest rates for young people or older people going back to
school who are trying to get an education and the work skills they
need? Why would we allow that when we can get mortgage rates right now
from 3\1/2\ to 4 percent or a car loan for about 4 percent? I could go
on and on.
Here is the shocking thing. If the rates are doubled--if in fact what
kicked in on July 1 is allowed to stand--it will mean a huge profit for
the Federal Government. That also makes no sense. It will mean some $50
billion for the Federal Government, according to the Congressional
Budget Office. Why should the government profit off the backs of
students who are struggling to get an education so they can get ahead?
We have a fundamental disagreement in this body between the majority
of Democrats and the majority of Republicans on that question. It is a
fundamental difference about what we should pick as a priority for our
country. Frankly, for nearly 300,000 students in Michigan who will be
forced to pay an extra $1,000 on their loans this year, it makes no
sense.
I remember growing up in a little town in northern Michigan, working
hard, getting good grades in my small class of 93 people, being at the
top of the class, and wanting to go to college. But my dad became very
ill and we couldn't afford for me to go to school. I was the first one
to get a college degree in my family. I managed to go to school because
the State of Michigan and the Federal Government at that time placed a
value on educating kids like me, who didn't have a lot of money but had
worked hard and had good grades and thought we ought to have a shot. I
had a tuition and fee scholarship, and so I was able to go to college.
I put that scholarship together with working on campus and with
student loans and I was able to get a bachelor's degree. I was then
able to go on and get a master's degree and came out of school having
to pay off the student loans. But because some folks--who didn't know
this redheaded, freckle-faced kid from Clare--decided this was an
important value for America, this was an important value for our State,
I had a chance to work hard and follow the rules and make it. And who
would have thought then I would have the opportunity to be here today?
I want that same opportunity for every young person in Michigan and
every person going back to school in this country. Fundamentally that
is what this is about. It is not about numbers. It is not about
numbers. It is about whether, when we subsidize all kinds of other
things--banks, and even the farmers I fight for, to help them with
their crop insurance, and subsidizing rates for insurance to do things
because it is good for the economy--why in the world would we walk
[[Page S5534]]
away from that most basic set of values when it comes to our students?
Colleagues on the other side of the aisle say: Let's do something
where we peg a rate. It is like a credit loan teaser rate. Sign up now
at zero interest or 3 percent, let's put it there, and then over time
it balloons like crazy and you are stuck. Those are the kinds of
proposals we have gotten from the other side of the aisle. It sounds
good now, but it is horrible later. I know a lot of folks who signed up
for variable rate mortgages and balloon mortgages who ended up in the
same situation. We are saying: No, we want a fixed rate. We want it low
and we want to make sure students are placed as a priority.
So after all kinds of negotiations, we have said: OK, you don't want
to continue the rate for 2 years. Let's do this: Let's continue it for
1 year at the low rate of 3.4 percent, and then let's all get together
to figure out what to do about helping out with this $1 trillion in
student loan debt right now. That is the student loan debt across this
country. We need to help them figure out how to refinance that lower
rate and then we can deal with the long-term cost. That is what we are
trying to do. It doesn't make sense, when student loan debt in the
country is over $1 trillion, when students are already sacrificing and
scraping together the money to get an education, to double the rates on
those student loans.
So when we look at this, we are looking not only at today but over
time. In every proposal that has been put forward--and there are a lot
of folks working, and I know there are conversations going on with
folks who want to solve this problem--they all end up with the rates
going up higher than even doubling the rate to 6.8. Why does that make
any sense? Why would folks propose that? We have a fundamental
difference in how we view this issue of the cost of college and whether
there is a role for the Federal Government.
Do we as a country have a stake in keeping costs as low as possible,
interest rates as low as possible? I would argue, yes, we do. And if we
want to stop subsidizing things, I can think of a whole long list of
what we could stop subsidizing. We could stop subsidizing the top five
wealthiest oil companies in the country, which have more profits than
anyone in the world. We could stop subsidizing them. We could stop the
loopholes that are taking our jobs overseas. We could stop doing that.
There are a lot of things we could stop that would save money. We
should not put all this on the backs of students. We should not say
that somehow we should make a profit to pay down the debt on the backs
of students, when in fact there are so many other areas where we should
be asking people to chip in a little bit more, not those who are
already working hard to get a basic education.
We know we have to have a comprehensive approach, but until that work
is done we should keep interest rates low. We should keep them where
they are. And I have great confidence in Chairman Harkin and his
committee, and Senator Jack Reed, who has taken so passionately the
lead on this. Senator Kay Hagan and Senator Reed are our leaders on the
bill we will be voting on tomorrow. Senator Warren, and so many
others--Senator Boxer I know has spoken out so many times, as has
Senator Sanders, and on and on, as well as the Presiding Officer. We
all care passionately about creating a long-term solution for students
that keeps costs low so we can keep dreams high and success high in
achieving those dreams.
I wish to thank so many for signing petitions and sharing their
stories with us. I would urge folks to get involved in the conversation
by joining us on Twitter, with the hash tag ``don't double my rate.''
There is a lot of conversation going on and information that folks can
find out about what we are doing.
I want to read two e-mails from constituents of mine. Corey, a
student at Central Michigan University, sent me an e-mail about how
this would make it difficult for him to continue his education.
As one of the taxpayers that you represent, I am asking you
to please not allow my student loan rates to be doubled. I am
a hard-working and respectful student. I make all of my
payments. I go to class and do well. I work hard and am
grateful for the chance to get a higher education, but if
student loan rates go up I would be left to make a decision
whether or not school will be affordable.
From the time we first start learning, we are encouraged to
attend college and get a good job so that we can be a part of
helping this country grow. I am simply asking you to help
continue to make this an affordable option for me, and many
others like me.
That story can be replicated all across Michigan and all across the
country: Will young people be able to stay in school? Will they be able
to come out of school and get the job they want versus aiming for a job
that relates to their ability to pay back their student loans?
Then an e-mail from Matthew in Royal Oak:
Students are not asking for a bailout like the one that
Wall Street got, just an opportunity to obtain an affordable
education so we can compete in the global economy.
That is what this vote is about tomorrow. The Keep Student Loans
Affordable Act simply says we are going to tackle this very serious
issue for families across the country in two steps: keep the interest
rates low where it is for a year, and then make a commitment to work
together to fix the larger issue of the cost of college going forward.
I don't think there is a more important issue for the future of
maintaining or recreating a middle class in this country than making
sure we can allow everyone who wants to go on to college and get the
skills they need to be successful in tackling and meeting their dreams
than to make sure that college is affordable. A big piece of that is
the interest rate on the loans that millions of students are taking out
right now and counting on us to make sure they are affordable.
Tomorrow the question will be whether a filibuster continues on this
issue. I think folks probably scratch their heads. We had a majority of
people who voted--all Democrats--before to continue the interest rates
at the current level of 3.4 percent. Because of the nature of the
Senate and how things work, if there is an objection we have to go
through this process to be able to overcome what is essentially a
filibuster and we have to get 60 votes. So tomorrow we are going to
have to get 60 votes, which means we need a handful of Republican
colleagues to join with us to make a statement that we should continue
interest rates at the low level while we work together in a bipartisan
way to solve the long-term problem.
We have over $1 trillion in this country in student loan debt. It is
more than credit card debt. I was surprised to see that. We have to
help families tackle that debt. I would like to see refinancing options
when interest rates are so low, and many of those are much higher
interest rates. We need to tackle that. We need to tackle the overall
costs of going to college and what is happening for low-income students
as well as middle-class students.
There is a lot to get done, but it has to start by doing no harm. And
that is the vote tomorrow: Do no harm. Let's make sure we at least keep
the rates low now. We know there is a philosophical difference about
whether we should actually help subsidize student loans. I think, of
all the things we could subsidize, I would start with education.
Tomorrow the question is, Do we do no harm? Do we keep the interest
rate where it is while we work out a long-term solution? Do we make a
very strong statement that if we are going to set something as a
priority for this country, if we are going to outcompete and outeducate
in a global economy, it has to start with making sure advanced higher
education is affordable for everyone who wants to work hard and play by
the rules and go to college?
That is what the fight is about. That is what the vote is about
tomorrow. I hope we will have an overwhelming bipartisan vote. If not,
we are going to continue to do everything possible to tackle this issue
because I think families across America are counting on us.
I yield the floor.
The ACTING PRESIDENT pro tempore. The Senator from Vermont.
Mr. SANDERS. Madam President, over the July 4th recess I had the
opportunity to talk with a number of young families about the crisis of
student debt. Without exception, this is what they said: Please do not
double the interest rates on subsidized Stafford loans from 3.4 to 6.8
percent.
[[Page S5535]]
Please make college financing more affordable, not more expensive.
This is an issue which not only impacts millions of families, it
impacts our entire future as a nation and our economy. Right now,
working-class families all over this country are asking themselves a
very simple question: Does it make sense for them to go $40,000,
$50,000, $100,000 in debt in order to get a college education? Many of
these young people and families are saying: No, it doesn't make sense.
So in a competitive global economy, we are saying to families all
over this country that we do not want their kids to get a college
education. We don't want them to become doctors, nurses,
businesspeople, scientists, and teachers. We don't want them to expand
their intellectual capabilities and make us a competitive nation in
this highly competitive global economy.
Now, if that makes sense to somebody, it surely does not make sense
to me. The doubling of student loan interest only makes an existing
crisis even worse. According to a report by the Consumer Financial
Protection Agency, the total student loan debt in the United States now
exceeds $1.1 trillion, which is nearly triple what it was in 2004. The
average loan balance for American graduates has increased by 70 percent
since 2004.
Average student debt is near $27,000. In Vermont, it is even higher--
over $28,000.
The burden of student loans is making it much harder for young people
to get mortgages and buy homes. Home ownership rates for young adults
are among the lowest in decades. Young people are putting off marriage
and having children partly because of the burden of student debt.
Over the last several months I have asked Vermonters--and people, in
fact, all over the country--to send me their experiences, to tell me
what this crushing debt of student loans means to their lives. We
received over 700 responses from all over America. What I would like to
do is very briefly read to you some of the responses I received from
the State of Vermont.
Emily Decker from Colchester, VT writes:
Watching the interest eat away my savings every month is
hard to swallow. To the point where we are not saving any
money because we put anything extra toward my loans so we can
pay them back ASAP. This is putting our plans for having a
family on hold because we want to have our finances in better
order before doing so.
In other words, Emily writes they are hesitating having kids because
they can't afford to do so at the current time.
Andrew Craft from Burlington, VT writes:
I am a 25 year old full-time college student at Champlain
College. I am a single mother. I am already $20,000 in debt
and I still have one more year to go before I graduate. I am
currently at an internship working part-time on top of school
and parenting, but I often feel like I am not ever going to
be able to ``get ahead'' and ``make it'' in spite of my
advantages.
Allison LaFlamme from Johnson, VT writes:
I cannot refinance my house, because even though my cars,
home, and credit cards are perfect on my credit score our
debt to income is too high because of our student loans.
Melissa Weber from Rutland, VT writes:
I have found myself struggling to survive independently as
a 25 year old with a Master's Degree. Yes I have achieved a
degree, of which I am proud, but I have also accumulated an
immense amount of debt that will likely haunt me for the
majority of my life. As a result of my daunting loan payments
I find myself barely surviving on an income that should
easily support a small family.
Evan Champagne from St. Albans, VT writes:
My wife and I both have $50K-$60K of loan debt each. We
both have good jobs, but a large percentage of our income is
used to pay back student loans. There are no low interest
consolidation options available. If there were, that would
also help. The education process should be rewarding and
create opportunities. For my wife and I, it did the opposite.
The American people want us to come together and solve this problem
now, not make the situation worse. When we tell people who are
struggling with these horrendous debts that the Stafford subsidized
loan rate is going to double and there are proposals out there that
make a bad situation worse, they respond in disbelief. They remember in
2009 when Wall Street collapsed because of their greed and illegal
behavior, we bailed them out. They understand that today we are
providing large Wall Street institutions with interest rates of less
than 1 percent. They are asking: If you can bail out Wall Street--
people whose greed caused the current recession--how come you can't
protect working-class and middle-class families and enable their kids
to get an affordable college education?
The Republicans in the House passed a proposal. Unfortunately, it is
a proposal which makes a bad situation worse. Under the House
Republicans' proposal, all student loans would have variable interest
rates, exposing graduates to market conditions. Even though the House
Republicans' proposal caps interest rates, the Congressional Research
Service estimates that students who take out the maximum subsidized
student loan amount will pay nearly $6,000 more over the life of that
loan than they would if rates are kept where they are today.
The so-called bipartisan student loan bill being discussed in the
Senate would also be a terrible deal for students, especially in the
coming years. It provides no cap to protect students for the first time
in the history of the student loan program. If this proposal were to
pass, according to CBO projections of interest rates, by 2018 student
loan rates will go up significantly.
Short term, we have to keep student loan interest rates at 3.4
percent. Long term, we need a national solution to make sure college is
affordable for all Americans.
The ACTING PRESIDENT pro tempore. The Senator from Wyoming.
Health Care
Mr. BARRASSO. Madam President, last week our Nation celebrated
America's Independence Day, and the Obama administration took advantage
of the holiday to slip out a couple of announcements about its health
care law. The first one came late one day as the media and most of the
Nation were distracted by their plans for the Fourth of July. The
administration finally had to admit to all of America that their health
care law is unraveling before their eyes. Several months ago Senator
Baucus predicted that the law was headed for what he called a train
wreck, and last week we saw the train go off the rails. What happened
was the Treasury Department put out a blog post, written by an
assistant secretary late in the day on July 2, that said it would
postpone the implementation of the employer mandate part of the health
care law until 2015.
This was one of the signature parts of the President's health care
law. Under the law, every employer with more than 50 people working 30
hours or more a week was going to have to offer expensive government-
mandated health insurance. Now we have a 1-year delay of this extremely
unpopular and damaging Washington mandate. Anytime you see the Obama
administration leak news like that late in the day right before a
holiday with the President out of the country, you can bet it is bad
news for him and for them. Presidents do not delay things that are
popular and that actually people want and like. When you see them try
to hide it in a blog post, that is another sign. Here is what the New
York Times said, front page:
Crucial mandate delayed a year for health law.
Large companies won't need to offer plans until 2015. GOP
seizes on shift.
The Washington Post ran a headline, page 1:
Health-care rule is delayed a year. A setback for Obama
law.
The Wall Street Journal said:
Health law penalties delayed.
The Obama administration has tried to hide its bad news, but it
failed. It also tried to spin the collapse of one of the law's most
important features as good news. But as we see it here, Washington
Post, ``A setback for Obama law.''
The Treasury Department's blog post claimed it was implementing the
law ``in a careful, thoughtful manner.'' If they were interested in
careful and thoughtful, Washington Democrats never would have pushed
through this reckless law in the first place, a law that many of them
admit they never even read. Using that much Washington spin when it
tries to sneak out bad news is another sure-fire sign that
[[Page S5536]]
the White House is trying to hide the train wreck. The President and
his supporters have been bragging about this part of the law for years.
Now here they are quietly dropping it for a year and pretending things
are going well for the law.
What does this announcement mean? First of all, this is a clear
admission that the President's health care law is unaffordable,
unworkable, and unpopular. Second, it may be too late. Here is a
headline from CNN Money yesterday. They wrote:
For Fatburger and others, Obamacare delay came too late.
The article says for many small businesses such as fast-foot
franchises, they have already begun adjusting to the law's burdensome
requirements. One business owner said the delay won't help his
employees. He said:
All it's doing is causing confusion, anxiety, and the
workers are paying the price.
The workers are paying the price. Now the mandate's a
moving target. It's very, very challenging.
For a lot of businesses, the adjustments they had to make included
cutting back workers' hours. Let's look at the latest employment
numbers released last Friday. In June, the number of people working
part time--these are people who actually want to work more--soared by
over 322,000. There are now 8.2 million Americans working part-time
jobs because their hours were cut back or because they could not find
full-time work. Republicans have been warning this would happen because
of the Democrats' health care law and that is exactly what has been
happening for months now. The White House admitted as much when it said
employers needed relief from the logistical mess the law created.
If the law makes it so bad for businesses that they can't handle it
in 2014, I will tell you it is still going to be bad for them in 2015.
If it is bad for employers, it is going to be bad for men and women on
the street, the hard workers of America. When do they get relief? Will
the administration now postpone the requirements that every man, woman,
and child in America has to buy expensive government-mandated
insurance? I hope they do. You can bet labor unions and other special
interest groups are going to step up their lobbying to postpone the
parts of the law that hurt them. Even the Commonwealth of Massachusetts
is asking for a waiver from portions of the law.
Let me be clear. I think it is a good thing for employers that they
will not have to face this job-killing mandate next year, but why
should they have to face it at all? Is the Obama administration finally
seeing the light on what a disaster it will be to implement or is it
another gimmick? Well, as Ronald Reagan once said:
They only come around on your side when they want to get
their hands on your wallet.
This 1-year postponement is not a real solution. It is not designed
to help job creators or taxpayers. It is designed to delay the train
wreck until after the 2014 elections. This 1-year postponement, in my
opinion, is a cynical political ploy to try to fool the voters one more
time.
Don't just take my word for it, because CNBC asked Peter Orszag about
it the other day. People know he headed President Obama's Office of
Management and Budget in the President's first term. He was a big
proponent and supporter of the law. He told CNBC that White House
officials ``by definition,'' he said, thought that delaying the
employer mandate would help them politically ``or they wouldn't have
done it.''
``By definition,'' therefore, they thought it would help them ``or
they wouldn't have done it.''
If they didn't expect it to help them politically, ``they wouldn't
have done it.'' That is an incredible admission by a member of the
Obama administration, his inside team. Just because the President
thinks this is good for him politically doesn't mean it is good for
the country.
On Friday, the Obama administration also tried to sneak out another
admission that its health care law is not working. Remember, even
though employers have another year before their mandate kicks in, all
the people still have to buy expensive Washington-approved, Washington-
mandated insurance and they have to do that by this upcoming January 1.
To try to hide some of the costs, taxpayers are going to subsidize the
higher premiums some people have to pay.
The Wall Street Journal just last Monday:
Insurance Costs Set For A Jolt. For the healthy, rates
could soar under new law.
Insurance Costs Set For A Jolt.
To try to hide some of the cost, taxpayers are going to subsidize the
higher premiums some people would have to pay, but the prices are going
to go up so high subsidies may cover some but not all. If someone
wanted the subsidy, the government, of course, will have to verify
those people deserve the subsidy.
Not anymore, because now, under the administration's new policy,
buried away in 606 pages of regulations, on Friday, they said nobody is
going to check those answers.
In an editorial yesterday, the Wall Street Journal called
these ``ObamaCare's liar subsidies.'' The paper agreed that
managing the law's rules and regulations was complicated:
``Yet,'' the editors of the Wall Street Journal wrote, ``this is the
system Democrats installed when they passed the law, which is not
supposed to be optional due to administrative incompetence.''
Administrative incompetence is exactly what this is. It is also a
recipe for rampant waste, fraud, and abuse. And it is an abuse in the
taxpayer subsidies.
I have criticized the complicated process the administration was
setting up to verify people's subsidy applications. That is because I
think it is a tremendous example of government overreach and because
Washington bureaucrats at the IRS and other agencies have shown they
can't be trusted with that kind of information. The solution now,
apparently, is to scrap the verification system. We should be cutting
the cost of insurance. That is what people wanted. That is why we had
health care reform, to get down the cost of care, not driving up the
costs, giving subsidies to a select few people and giving Washington
more power to watch over the whole system. The American people do not
need to put off the wreck until the train goes around one more bend.
They want to stop the train wreck from happening at all.
The American people want more than a temporary delay of one part of
this terrible health care law. They want a permanent repeal of the
whole thing. Now that the Obama administration has admitted its law is
too complicated and would have too many negative side effects, it is
time for it to set aside the political games and do what is best for
the country. It is time to repeal this bad law and replace it with
health care reform that will work.
I yield the floor and suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The legislative clerk proceeded to call the roll.
Mr. ALEXANDER. Mr. President, I ask unanimous consent the order for
the quorum call be rescinded.
The PRESIDING OFFICER (Mr. Schatz). Without objection, it is so
ordered.
Mr. ALEXANDER. Mr. President, I come to the floor to ask my
Democratic colleagues to take another look at the student loan issue
that will be before us tomorrow. We are playing with real lives here.
These are about 11 million students who are going to college in the
fall. They will be taking out 18 million loans for this year. Taxpayers
will be loaning them over $100 billion. The only proposal we are going
to be voting on tomorrow appears to be one that will leave over 7
million middle-income college students swinging in the wind, paying
about twice as much in interest rates as they should be paying.
At the same time, we have a proposal that is based upon a
recommendation by President Obama that is like legislation already
passed by the Republican House of Representatives that is supported by
an Independent and two Democratic Senators and three Republican
Senators that would lower student loan interest rates on every single
one of the 18 million new loans that would be taken out next year and
cut nearly in half the interest rates on loans for undergraduate
students, which make up two-thirds of the loans.
I ask the question, why would we do a 1-year political fix that only
helps students taking 40 percent of the loans, when we have before us a
bipartisan proposal that is close to the idea of the
[[Page S5537]]
President and the House that would help every single student, and
especially why would we do that when we leave middle-income students
twisting in the wind, paying hundreds of millions of dollars more in
interest rate than they should be paying over the next 10 years?
The student loan issue is becoming like what we call the doc fix,
where Congress, for political reasons, every year rushes around and
makes a temporary patch. There is no need to do that here, no need
whatsoever.
I ask my friends on the Democratic side to look at what the President
has proposed and the reasoning behind it. It was in his budget. Look at
what the House of Representatives has done. They actually passed a bill
that lowers rates. Then look at the proposal by Senator Manchin,
Senator Carper, Senator King, Senator Burr, Senator Coburn, and myself
in the Senate. What our proposal would do is provide a long-term
solution: if you are an undergraduate student at the University of
Tennessee, instead of your rate being 6.8 percent, it would be 3.66
percent. The Democratic proposal, I repeat, does nothing for over 7
million middle-income students who are going to be paying 6.8 percent
when they should be paying, if they are undergraduates, 3.66 percent
under our proposal. That is nearly half as much. There is no need for
that.
This is like other political situations, we have some misinformation
going back and forth across the aisle. I hope my colleagues will take a
look at the Burr-Manchin proposal. The right thing for us to do is to
say to these 10 million students, all of them, every single one of
them, that when you go to take out your 18 million loans this year you
are going to be paying a rate that is fair to taxpayers and fair to
students. It is fair to taxpayers because it will not be costing the
government any money and it is fair to students because the government
will not be making any money. It will not be reducing the deficit on
the back of the students. That is the principle upon which we can
agree--fair to taxpayers, fair to students; doesn't cost the taxpayers,
doesn't balance the budget on the backs of students. On that basis we
can say to students: Take advantage of these low rates. You can get a
10-year loan if you are an undergraduate at 3.66 percent. There is no
need to pretend we are helping students when the alternative proposal
only addresses 40 percent of the students. These are the subsidized
loans. These are the loans for the low-income students, who already
get, for the most part, Pell grants, who already have their interest
paid while they are in school--that is a big subsidy. It is over $50
billion in the next 10 years. We leave the middle-income students over
7 million of them--over the next 10 years paying hundreds of millions
of dollars they shouldn't be paying. I don't know why my friends on the
other side want to leave the middle-income students of America twisting
in the wind, paying higher interest rates than they should.
So let's step back and look at the facts. Let's look at the
President's proposal, look at what the House passed, and look at the
bipartisan Burr-Manchin proposal. I respectfully urge the majority
leader to allow us to vote on that. I urge my colleagues on the other
side to coalesce around that idea. Let's say to the students of
America: As the Senate, we know a good idea when we see one, and the
Burr-Manchin proposal is such an idea.
____________________