[Congressional Record (Bound Edition), Volume 160 (2014), Part 6]
[Senate]
[Pages 8484-8486]
[From the U.S. Government Publishing Office, www.gpo.gov]




                           STUDENT LOAN DEBT

  Mr. DURBIN. Madam President, I thank my colleague from Michigan for 
her statement because it raises a theme which we really need to focus 
on in the Senate.
  I went back to Illinois this last weekend, traveling around, as I 
have over the last several months. After a person has been in this 
world of politics for a

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while, it doesn't take long to sit down with most gatherings and crowds 
and kind of test out ideas. People either fold their arms and look at 
the ceiling and pray you stop talking or they start getting on the edge 
of their chair and listening. What I have found over the last several 
weeks is that everywhere I go, everywhere in the State--downstate small 
towns, medium-sized cities, and the city of Chicago--there is one issue 
that has everybody sitting up and listening. The issue is student 
loans.
  We wonder why that issue would have so many people interested. It is 
because 34 million Americans are paying back student loans now. In the 
State of Illinois, there are 1.7 million people paying back student 
loans--1.7 million. Fifteen percent of our population is paying back 
student loans. There is more student loan debt in America today than 
credit card debt.
  Some of the loans these students are taking out to go to school are 
outrageous. There is no other way to describe it. These young people, 
19 or 20 years old, are sitting there at the desk at the college as 
someone is shoving a piece of paper toward them for them to sign 
saying: Well, if you sign up here for your loans, you can start classes 
on Monday. That young man or woman, who has been told since they were 
just a little kid to go to college, go to college, go to college, signs 
on and heads to class. At the end of the day those students end up 
$20,000 in debt, $30,000 in debt, and more--dramatically more. Many of 
them don't have a clue about the indebtedness they are getting into to 
go to school. Some of them don't know they are being lured into these 
for-profit colleges and universities. Sadly, too many of them are 
worthless. Students are signing up for these for-profit colleges and 
universities thinking they are real schools, thinking it is just like 
the University of Wisconsin, just like the University of Illinois. No, 
it isn't. It is a business, and it is a business that makes its money 
off of kiting the cost of tuition for students and, if they can stick 
around to finish, handing them a worthless diploma. How does a student 
know this? Well, the honest answer is they don't until it is too late.
  Hannah Moore has been at my press conferences twice. She went to one 
of these awful for-profit schools and ended up with $120,000 in debt 
for a bachelor's degree and a worthless diploma. She couldn't get a 
job. Her debt is now closer to $150,000. She can't pay it. Here she is 
barely 30 years old with over $100,000 in debt for a worthless diploma. 
That is the extreme, but for 10 percent of the students graduating from 
high school in America today, those are the schools they go to--for-
profit colleges and universities.
  Which are the biggies? The University of Phoenix, No. 1; DeVry 
University from Illinois, No. 2; and Kaplan University, which used to 
be owned by the Washington Post. These are the big ones.
  Remember three numbers when you think about the for-profit colleges 
and universities: 10 percent of high school students go to these 
schools. These schools get 20 percent of the Federal aid to education 
because their tuition is so outrageously high--20 percent--over $30 
billion a year going to this industry. And here is the kicker: 46 
percent of all student loan defaults are students at for-profit 
colleges and universities. What does that tell us? They charge too 
much, the educations are not worth it, and the students can't get a 
job.
  That is the most extreme example, but let's talk about the rest of 
the world: 97 percent of students going to other colleges and 
universities. They are running up debt at record numbers, at a record 
pace. Unfortunately, many of those student loan debts lure in their 
parents and sometimes grandparents to help them along, and the student 
debt grows and grows. Sadly, if they make the big mistake of going not 
to a for-profit school but one of the regular schools and sign up for 
private loans, they are in for a beating, and they don't know it. They 
are young students. How could they possibly know what they are signing 
up for--a school that would lure them into a private loan to go to 
college and then subject them to the harshest, toughest, meanest, most 
unrelenting collection agency you have ever seen coming after these 
students on their student loans. That is the world we live in, and that 
is a world that needs to change.
  When I go home and talk to people about it, they are either directly 
personally affected by it, their family is affected by student debt, or 
they worry that their sons and daughters who may want to have a chance 
at higher education will get sucked into this same scam. Well, help can 
be on the way.
  I have joined with two of my colleagues, Jack Reed of Rhode Island 
and Elizabeth Warren of Massachusetts. We have a package of three bills 
that would give students from middle-income families, working families 
across America, a fair shot at an affordable higher education. My bill, 
the student borrower bill of rights, says the school has an obligation 
to tell students to stick with the government loan because it is a 
lower interest rate and not lure students into a private loan. Jack 
Reed has a bill which stipulates that if schools keep sinking students 
deeper in debt and they can't get out of it, eventually the school has 
to accept financial responsibility. That will get their attention. But 
the big bill of the three comes from Elizabeth Warren--and we are 
joining her--to refinance college debt at lower interest rates, bring 
them down from 7, 8, 9, 10 percent to 3.8 percent. Does it make a 
difference? Anybody who has ever had a home mortgage will say it does. 
Lowering that interest rate to 3.8 percent will finally allow some of 
these families and students to start paying off the principal on the 
student loan and put it behind them. Consolidate the loans at lower 
interest rates is what our bill says.
  Oh, Senator, great idea. Who is going to pay for this?
  I will tell my colleagues exactly how we pay for it--exactly. Does 
the name Warren Buffett ring a bell? He is one of the richest men in 
America. He has done very well for himself, the ``Seer of Omaha,'' 
Berkshire Hathaway. He came to Congress a few years ago and said: 
Something is wrong with the Tax Code.
  Do we know what is wrong with it? Warren Buffett is paying a lower 
income tax rate than his secretary.
  Why, he said, is my secretary, who makes dramatically less money than 
I do, paying a higher income tax rate than I am?
  The reason is pretty clear: Most of his income comes from capital 
gains, and that is lower than the regular income tax rate.
  So Warren Buffett said: We ought to have a rule that says if you are 
a millionaire in America, you are going to pay at least as much as the 
people who work for you pay in taxes--the Buffett rule. The Buffett 
rule generates enough money in the Tax Code by imposing that tax burden 
on millionaires to refinance college loans across America. Is it worth 
it? You bet it is, and I will tell my colleagues why. I don't begrudge 
millionaires their wealth if they have come by it legally, and I 
believe Mr. Buffett has. But they have an obligation to this great 
country that set the stage for their success, and that obligation is to 
be a good citizen, pay their taxes. That is what Mr. Buffett has 
suggested. He is willing to accept that responsibility.
  And if we can refinance student loans, it doesn't just bring relief 
to these families, it does something else. Hannah Moore is living in 
her parents' basement with $148,000 in student loan debt and she is 
barely 30 years old. The thought of borrowing more money to go to a 
real college is out of the question. The thought of living in her own 
apartment is out of the question. The thought of buying a car? No way. 
For some young couples even having children is out of the question 
because of student debt. Do we see that when we bring this debt under 
control, we unleash a positive growing force in our economy where these 
young people can get back and participate--buy homes, buy cars, become 
full-fledged members of the economy again. So it not only brings relief 
to families and gives them a fair shot at a college education they can 
afford, it also can help our economy overall.

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  We don't have a single cosponsor from the other side of the aisle yet 
on this--not one. They are scared of the Buffett rule. The idea that 
millionaires might have to pay higher taxes scares them away. If they 
have a different pay-for, come on down. Let's hear the ideas. Let's 
actually have a dialogue on the Senate floor. How about that. That 
would be historic. And we could talk about solving a problem in America 
such as this runaway college debt and these awful for-profit colleges 
and universities.
  We need to work together. What we have before us is the tax extender 
bill and a bill which involves a lot of different sections of the Tax 
Code. This bill is not paid for--by and large not paid for. Some of us 
believe that unemployment compensation, which was cut off for millions 
of Americans over the last several months, should be there to help them 
get back on their feet. When we suggest it to our Republican friends, 
they say: No, no, you have to either raise taxes, which we will oppose, 
or cut spending to pay for unemployment.
  But when it comes to tax cuts for businesses, good or bad, they look 
the other way. They do not think that has to be paid for. I think 
helping unemployed Americans get back on their feet, find a job, take 
care of their families, is central to putting this economy on a 
glidepath to the future.
  I hope as we measure the issues we can debate here on the floor of 
the Senate, we will start with those issues that interest the people we 
represent and that affect their lives and give working families a 
fighting chance.
  I yield the floor.
  The PRESIDING OFFICER (Mr. Manchin). The Senator from New Mexico.
  Mr. UDALL of New Mexico. Madam President, I applaud Senator Durbin 
for his comments on the fair-shot agenda and on an affordable college 
education for all of our kids. It is something parents and families and 
people in New Mexico talk to me about all the time. I want to join the 
Senator in his comments and say, let's get this done. Let's see if we 
can get Republicans to work with us in a bipartisan way. I applaud the 
Senator's speech.

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