[Congressional Record (Bound Edition), Volume 160 (2014), Part 5]
[Senate]
[Pages 6986-6987]
[From the U.S. Government Publishing Office, www.gpo.gov]




                           STUDENT LOAN DEBT

  Mr. MURPHY. Mr. President, I wish to very briefly join my colleagues 
here in support of the effort being led by Senator Durbin, Senator 
Warren, Senator Reid, and Senator Harkin. They have done such 
incredible work on behalf of students all across the country.
  One of the most amazing statistics to me is a simple one. Not so long 
ago the United States was No. 1 in the world when it came to the number 
of young people who had college degrees. In a very short amount of 
time, we have precipitously fallen from No. 1 to No. 12 due to the fact 
that other countries have caught up, which is an issue in and of 
itself, but it also has something to do with the fact that the cost of 
college has become calamitous for students all across this country, and 
it is taking kids a lot longer to complete their degrees--many of whom 
are starting and never even finishing.
  I am an example of the squeeze that American families are in. I don't 
complain about the income my wife and I make, but we are both paying 
back our student loans and we are saving for our kids' student loans. 
So I know the amount of a family's income that can be gobbled up trying 
to pay back prior college and save for future college, and I know where 
that money would go if it weren't going to pay for those two costs. For 
us, that money would go into the local economy.
  So this is the middle-class issue of our generation, as my colleague 
Senator Schatz often says, because it is not just about families trying 
to pay back college and save for college; it is also about all of the 
places that money could go if it weren't going to the banks and the 
Federal Government, which are making a pretty profit off of this system 
as it is.
  Finally, I will make a pitch for a piece of legislation that Senator 
Schatz, myself, and Senators Murray and Sanders have introduced because 
I think we need to have two conversations. One is about making sure we 
reduce the financial burden for families, but there is also a 
conversation we need to have about putting pressure on schools to 
reduce the ticket price, the sticker price of attending college. We, 
frankly, haven't done a very good job of leveraging the $140 billion we 
spend on financial aid to pressure colleges to do the right thing.
  There is one for-profit college in California that takes in 1.6 
billion every year of taxpayer dollars, and the average student there 
spends only 3 months on campus because they start school and never 
finish it. Their loan default rates are above 30 percent. That is a 
terrible investment for those kids but also for the Federal taxpayers' 
dollars.
  Our piece of legislation--which we hope will be considered in the 
broader reauthorization of higher education statutes in this country--
would say it is time we hold colleges to a different standard and force 
them to get serious about costs and quality. In the end, that will be 
just as helpful--keeping control of quality and cost at our colleges--
as the effort being led by so many of my colleagues on the floor here 
tonight.
  I am very glad to join in this effort. It is a personal cause for me 
and my family given that we are living this reality today but one that 
is a much greater imperative for all families who have been struggling 
with this burden across the State the Presiding Officer and I 
represent.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from New York.
  Mr. SCHUMER. Mr. President, I am going to be very brief, and I will 
come back tomorrow to speak at greater length.
  One of the things Americans know is that college is becoming more of 
a necessity and is getting to be priced like more of a luxury. We can't 
have that. When college is a ticket to success--not just income success 
but even recent surveys show longevity and happiness--it is a crying 
shame when any American deserves to go to college but doesn't go or 
doesn't go to the right college because he or she can't afford it. We 
aim to change that in a variety of ways, but the one Senator Warren has 
talked about and taken the lead on is in terms of refinancing.
  It is absolutely outrageous that students who got out of college in 
the last 5 to 20 years are paying 8 percent, 9 percent, and up to 13 
percent in interest. If they took out a loan today, they would pay 3 
percent or 4 percent. This puts huge burdens on their shoulders in 
their prime earning years and their family-forming years. It crimps the 
housing market because if you have $30,000 in student loans, you are 
not likely to take out a $100,000 mortgage.
  So all we are asking for is a fair shot. If you deserve to go to 
college, you should have a fair shot at affording college. And if you 
have gone to college, you should have a fair shot at being able to pay 
your debts and live a decent life. It is very simple.
  We Democrats are focusing our attention on what the average American 
needs, giving the average American a fair shot. And there is probably 
no place where that fair shot is less attainable than in college 
affordability and in acquired student loan debt.
  I hope people will listen to us in the next several weeks. I hope my 
colleagues on the other side of the aisle--unlike on minimum wage or 
equal pay--will join us in coming up with a bipartisan proposal. I hope 
we can do something for these students--those

[[Page 6987]]

who have already gone to college and are paying disproportionate 
interest and those who are going to college and need to afford it. 
Everyone deserves a fair shot in America, and they certainly deserve a 
fair shot, if they have earned a place in college, to afford that place 
in college.
  I look forward to continuing this discussion and debate in the next 
several weeks to come.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Massachusetts.
  Ms. WARREN. Mr. President, I commend the Senator from New York and 
all of my colleagues who have been here.
  Forty million borrowers in this country have student loan debt. 
Student loan debt is exploding, and it threatens the financial 
stability of our young people and the financial stability of this 
country.
  I am pleased to see so many of my colleagues here tonight talking 
about this problem because, make no mistake, this is an emergency. 
Outstanding student loans now total more than $1.2 trillion, and 
millions of young people are struggling to keep up with their payments.
  It doesn't have to be this way. Congress set artificially high 
interest rates on old student loans which generate extra money for the 
government. The GAO recently projected that the government will bring 
in $66 billion on just the slice of student loans issued between 2007 
and 2012. Those are the kinds of profits that would make a Fortune 500 
CEO proud.
  These young people didn't go to the mall and run up charges on a 
credit card. They worked hard and they learned new skills that will 
benefit this country and help us build a stronger America. They deserve 
a fair shot at an affordable education, and we can give them immediate 
relief by cutting the interest rate on existing student loans. We 
should cut those interest rates and cut those government profits.
  Yesterday I joined with 27 of my colleagues to introduce the Bank on 
Students Emergency Loan Refinancing Act, which will do just that. The 
idea is simple. With interest rates near historic lows, businesses, 
homeowners, and even local governments have refinanced their debts. But 
a graduate who took out an unsubsidized loan before July 1 of last year 
is locked in to an interest rate of nearly 7 percent. Older loans run 8 
percent, 9 percent, and even higher. We need to bring those rates down, 
and we need to do it now.
  Bank on Students would allow student loan borrowers the opportunity 
to lower their interest rates on old loans to match the rates the 
government offers to new borrowers--3.86 percent on undergraduate 
loans, 5.41 percent for graduate loans, and 6.41 percent for PLUS 
loans.
  I wish to be clear. These rates are still higher than what it costs 
the government to run its student loan program. Our work will not be 
done until we have eliminated all of the Federal profits on these 
loans. But this legislation is an important step in that direction, and 
it is a step both Republicans and Democrats should support.
  Last year nearly every Republican in Congress--in the House and the 
Senate--voted for the exact same loan rates in this legislation. If 
Republicans believe that 3.86 percent is good enough for new 
undergraduate borrowers, then it should be good enough for all existing 
undergraduate borrowers. There is no reason on Earth to say some kids 
can get a better deal than others when they all worked hard to do 
exactly what we wanted them to do--get an education.
  This legislation won't add a single dime to our deficit. The Bank on 
Students legislation adopts the Buffett rule, which limits tax 
loopholes for millionaires and billionaires. Every dollar we bring in 
as a result of that change will go directly to supporting lower 
interest rates on existing student loans.
  We only introduced this bill yesterday, but we are already getting a 
great response. Think tanks such as Demos, student groups such as Young 
Invincibles, teacher groups such as the American Federation of Teachers 
and the National Education Association have all come forward and 
endorsed this proposal. Letters and emails and phone calls are already 
pouring in. I am also encouraged by the fact that some Republicans have 
also come forward to say they are open to considering a refinancing 
proposal.
  I want to be clear. This should not be a partisan issue. I am eager 
to work with any of my colleagues who believe we need to do something 
about the growing student debt crisis. If the Republicans have issues 
with this proposal, if they want to suggest different offsets or policy 
changes, they should bring their ideas forward. What we can't do is 
continue to ignore this problem and hope it will go away on its own.
  Congress made this mess by setting artificially high interest rates 
that are crushing our kids. It is Congress's responsibility to clean it 
up.
  I don't kid myself. Refinancing will not fix everything broken in the 
higher education system. But the need for comprehensive reform must not 
blind us to the urgency of addressing the massive debt that is already 
crushing our young people.
  This is personal for me. I grew up in an America that made it a 
priority to invest in its young people and the opportunity to go to 
college. An affordable college and affordable loans opened a million 
doors for me. I will keep fighting to make sure every kid who works 
hard and play by the rules gets a fair shot.
  Mr. President, I yield the floor.
  The PRESIDING OFFICER (Mr. Heinrich). The Senator from Connecticut.

                          ____________________