[Congressional Record Volume 159, Number 97 (Tuesday, July 9, 2013)]
[Senate]
[Pages S5537-S5539]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
Student Loans
Mrs. MURRAY. Mr. President, we are here today because, unfortunately,
the financial burden on our Nation's college students dramatically
spiked overnight 8 days ago, including for over 100,000 students across
my home State of Washington, where 56 percent of college graduates
leave school with a student loan debt, and the average amount they owe
is more than $22,000. Just when they are getting started on their
careers, instead of buying a house or buying a car or just paying the
bills, their student loan bills are piling up with interest.
Now interest rates for Federal student loans, which have been kept at
a low rate of 3.4 percent, have doubled to 6.8 percent. For these
students and for millions of students across the country, that is a tax
hike of $1,000. That is not fair to students, and it is certainly not
good for our economy. Congress has to act to fix it.
This isn't just an abstract issue for me; it is very personal. Pell
grants and student loans were what allowed my six brothers and sisters
and I to go to college after my dad got sick and had to leave his job.
They are what made college affordable, and they are what allowed each
one of us to pursue a career and give back to our communities. Because
our government was there to help my family and help us through hard
times, those seven kids in my family grew up to be a firefighter, a
lawyer, a computer programmer, a sports writer, a homemaker, a middle
school teacher, and a Senator. In my book, that was a good investment
by our country and our government.
My family's story is far from unique. In fact, last week I traveled
around my home State of Washington listening to student after student
after student describe the real-life impact this rate hike would have
on them. Students such as Elizabeth from Vancouver, WA: She is a
sophomore at the University of Washington. She comes from a family of
five children with immigrant parents who work hourly low-wage jobs.
She told me growing up, the idea of paying for college was
overwhelming, but thanks to scholarships and grants and loans she is
able to pursue her dream of becoming a broadcast journalist. However,
her part-time work-study position barely covers her bills, and she says
she is constantly plagued by stress as she worries about how she is
ever going to overcome what she calls her ``debt sentence.''
The reality is this is a simple issue. College is already too
expensive for students such as Elizabeth, and Congress shouldn't make
it worse. So I am very proud to join my colleagues in supporting the
Keep Student Loan Rates Affordable Act to extend the 3.4 percent
interest rate, and I urge our friends on the other side of the aisle to
join us and pass it.
With student loan debt now exceeding $1 trillion, students and their
families deserve due process and thoughtful consideration of issues
such as financial aid. Students have already contributed billions to
deficit reduction, but the problem is the Senate Republican leadership
has insisted in all of their proposals that we balance the budget on
the backs of struggling students and their families. So far, they have
refused to put the interest of students and tomorrow's middle class
ahead of Tax Code spending that benefits the wealthy.
What they have introduced is a bill that includes no cap on how high
student loan rates could go--something CBO tells us would mean students
could be locked in at rates over 8 percent in just a few short years.
In effect, it would be better to do absolutely nothing now than to take
up and pass the Republican bill.
I bet everybody listening knows a family member or a coworker who is
up to their neck in student debt. It is a weight that keeps them from
helping to grow our economy or start a family or take risks with their
careers, and it is a weight that is not easily shed.
We can't continue to do this to generation after generation of
college students and expect to be able to compete in the 21st-century
economy. We have to do everything we can to remove barriers to
education, not erect new ones.
[[Page S5538]]
The clock has run out. We need to act now because for millions of
Americans, affordable college has been the ticket to the middle class,
and we can't allow it to slip away. We can't allow access to college to
become unattainable for so many of our families.
I urge our Republican colleagues to join us in investing in America's
future by reversing this student loan increase and making college more
affordable for America's middle class.
I yield the floor.
The PRESIDING OFFICER. The Senator from Tennessee.
Mr. ALEXANDER. Mr. President, I am glad I stayed to hear the Senator
from Washington speak because I think this highlights the issue. That
is a terrific political speech, but it bears no resemblance to what is
actually happening in the student loan debate.
The distinguished Senator from Washington talked about rates going
up. Rates are going up for over 7 million--7 million--middle-income
students in America who are going to be taking out loans this year, and
the Democratic proposal does nothing for them. Their proposal does
nothing for them.
All the Democrats are trying to do is a political fix for 1 year for
students taking out 40 percent of the loans who are already the
beneficiary of Pell grants, as she so ably expressed, who have their
interest paid while they are in college. These students are borrowing
subsidized loans. These students may receive a Pell grant of up to
$5,550. They have their interest paid while they are in college. This
accounting system used by the Congressional Budget Office is very
generous to students as opposed to taxpayers, because it is done under
the Federal Credit Reporting Act, which is more generous to students,
in this case, than taxpayers.
What about the over 7 million middle-income students who are just
swinging in the wind under the Democratic proposal? It does nothing for
them.
On the other hand, we have the President of the United States, a
Democrat, and we have the House of Representatives, a majority of
Republicans, and they fundamentally agree on one idea: Let's have a
permanent solution. Let's figure out what it costs the taxpayer to
allow the government to issue loans--the government is lending over
$100 billion a year--and loan it to the students at no profit--at no
profit--so the students can use it--all of them, not 40 percent of
them, not just low-income students but middle-income students as well--
and all of them will have their rates lowered.
So what will the effect be? Their proposal would fix at 3.4 percent
for 1 year the student loan interest rate on 40 percent of the loans.
Our bipartisan proposal would fundamentally--as does the President's
proposal and the proposal passed by the House of Representatives--lower
the rate to 3.66 percent for all undergraduates. It would be not just
for the students borrowing 40 percent of the loans but for all middle-
income students and graduate students as well. Their rates would be
lower than 6.8 percent.
What is good about a short-term political fix that makes middle-
income students and graduate students pay hundreds of millions of
dollars more over the next 10 years? What is good about that? All it
does is provide an opportunity to make a well-rehearsed political
speech about student loans.
We all want to encourage students to go to college. We are looking
for a way to give them some predictability and some certainty so
students don't have to worry, when they graduate from Maryville High
School in Tennessee where I went, that Congress isn't going to do its
job. All the other side is going to do is stand up and make political
speeches that have nothing to do with the issue.
In this case, the President has done his job by recommending a long-
term solution. The Republican House of Representatives has done its
job. It passed a long-term solution that lowers rates for everybody. A
group of six Senators are doing our jobs. We have introduced a
bipartisan proposal that reduces rates for everybody, and it is a long-
term solution, while a number of the Democratic Senators are playing
political games. They are ignoring reality. They are going to freeze
for 10 years higher interest rates on loans for over 7 million--7
million--middle-income students across this country who are headed to
college--rates that are nearly twice as high as the bipartisan proposal
here, which is fundamentally like the proposal by the President and the
proposal by the House of Representatives.
What is the wisdom in that? I don't see it, and I don't think the
students will see it.
As far as balancing the budget on the backs of students, the only
people around here who have done that are the Democrats when they
passed the health care law. They put in that law a takeover of the
Federal student loan program and, according to the CBO, they had an
amount of savings of $55 billion, and they used part of it to reduce
the debt.
So the CBO says these are savings because the Democrats took over
student loans and the Democrats said they will use it to reduce the
debt, use it for the Pell grant program, and they used it to help pay
for the health care law. Every single year for the next several years,
students are being overcharged to help pay for the health care law.
So if we want to get into a big political discussion about who is
overcharging students in order to reduce the deficit or pay for the
health care law, we can have that. But that is not what we want to do.
We want a result, and we have suggested to the Senate--and I am going
to say it one more time: Instead of a 40-percent political fix for 1
year, we have suggested a long-term solution for 100 percent of the
students. It reduces their rates. It cuts nearly in half the interest
rate for every single undergraduate loan--every single one, which is
two-thirds of the loans--and it is based on an idea that was in the
President's budget, that has already been passed by the House of
Representatives, and that has been introduced by three on that side of
the aisle and three on this side of the aisle.
A Senate that is interested in a result instead of political
gamesmanship would be sitting down and trying to work that out. That is
what we want to do.
We can play games, too, I suppose. I can go get my statistics and
come back to the floor and say those over on the Democratic side, when
they passed the health care bill, did it on the backs of students. When
they balanced the budget--which they haven't done--they tried to do it
on the backs of students. And when they found some money for Pell
grants, they overcharged the students to whom they were loaning money.
That is true. I could do that, and I could say that, but I didn't come
here to spend all my time saying that. I came here to get results.
So this is not a game for 11 million students across this country.
They are trying to figure out how they are going to pay for college.
Just as the Senator from Washington said, it is not easy to do. They
expect us to come here with our backgrounds and say: We are going to do
the best we can. Instead of making this similar to what we call the
doctors fix, where every year we play a little politics and add a
little money to pay doctors who work with Medicare patients--that is a
terrible thing to do, but we do it every year--and now we are going to
treat student loans in the same way. In a Presidential election year,
everybody will make a big speech about it. Eleven million students will
sit around wondering how they are going to pay for college, waiting for
the people in Washington to make a decision about that. We should not
be doing that.
We have great promise here. We have a President making a long-term
solution, the House of Representatives of a different party agreeing
with him, and six of us on both sides of the aisle proposing a solution
that is a permanent solution for 100 percent for the 11 million people
who will be borrowing over $100 billion this year.
Why would they on the other side of the aisle insist on a solution
that forces 7 million mostly middle-income students to pay 6.8 percent
when they could be paying 3.66 percent? Why would you do that? Because
you have not thought about it, I think.
A lot has been going on. We have had an immigration debate and a
number of other things, so maybe Senators have not taken a look at
that. I have. I have had a chance to do that. I have been the president
of a university. I have been the Education Secretary. I know
[[Page S5539]]
something about the student loan program. I did not like it when the
Federal Government took it over. I admire our U.S. Secretary of
Education. I do not think he ought to be the banker of the year. I
think we have banks to make loans, but that is not the way it is. The
taxpayers now make all the government loans--over $100 billion a year.
Students are making their plans. They are going to be arriving at
colleges in August and September. We have a bipartisan proposal that
will lower interest rates for every single student taking out a student
loan. Yet our friends on the other side want to leave middle-income
students out of it, force them to pay twice as much as they should be
in interest rates for the next 10 years. That makes no sense. We ought
not do that.
Tomorrow what we ought to do is pass the Burr-Manchin proposal that
is supported on both sides of the aisle. To the extent it differs with
the President's proposal--which is very slight--and with the proposal
of the House of Representatives--which is not much--we should then sit
down, work something out over the next 3 days, pass it and send it to
the President and go on to the next issue. Instead, we have political
speeches about how hard it is to go to college. We all know how hard it
is to go to college. It is difficult to do. We all want to help. But if
we have a solution, we ought to adopt it.
I could play politics too. I know how. Every one of us in this room
knows how, otherwise we would not be here. This is not a time for
playing politics. This is serious business; 11 million students getting
18 million loans, $100 billion-plus from the American taxpayers. We
have a proposal before us that is fair to the taxpayers--it will not
cost them any money--it is fair to the students--it does not balance
the budget or pay for the health care program or any other thing on the
students' backs--and it gives students, many of whom who have no credit
rating, no other way to get money, a chance to get several thousand
dollars a year at one of the lowest possible rates available in the
country. The proposal that is before the Senate that is bipartisan is a
permanent solution. It says to the student going to the University of
Tennessee or Alaska or Minnesota: If you get a loan this year from the
government and you are an undergraduate, the interest rate is 3.66
percent. Your rate on that loan won't change. If you are a middle-
income student, the Democrats' plan says it is 6.8 percent, and they
say: Wait. Wait for what? Wait for rates to go up?
Why don't we establish this program for students at a time when rates
are low? That is to their advantage. Let's have a permanent solution at
a time when rates are low. They may go up and, therefore, students may
pay more, but they will pay a lot less than they would in the private
market. They will have a lot more certainty than if we just come around
and play politics with this every year to try to gain some advantage
with this student group or that student group.
So we have an opportunity before us. The immigration bill passed
before the recess. It showed a good deal of the ability of people on
both sides of the aisle to work together. We did that with the farm
bill. We did that with the water resources bill. I would submit this is
100 times easier than any of those bills.
When I went home to Tennessee before the Fourth of July recess, I
said to somebody who asked me: We are that far apart and we have the
President and the Republican House and a bipartisan group of Senators
all in about the same place. This ought to be easy to do.
It is still easy to do, but I would implore my Senators to look at
the facts--those on the other side of the aisle--and realize I do not
think they want to go home and explain why they are leaving over 7
million middle-income students twisting in the wind, paying twice as
much on interest rates for the next year as the proposal that they are
about to vote against tomorrow. I think that will be pretty hard to
explain, and I will bet there will be a lot of explaining to do if that
is the end result.
So I pledge--as I have been working with Secretary Duncan, with the
White House, with Democrats and Republicans--to try to get a result
here. I think we can still do it in the next few days. I would hope we
can have a vote on both proposals tomorrow. My guess would be both
would fail at this point, but at least that would show we are seriously
working toward a solution, and we can sit down and merge these small
differences that exist between the bipartisan group here, the
Republican House, and the President of the United States.
I yield the floor.
I suggest the absence of a quorum.
The PRESIDING OFFICER. The clerk will call the roll.
The assistant legislative clerk proceeded to call the roll.
Mr. NELSON. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.