On July 1, the interest rate on federally subsidized Stafford loans doubled from 3.4 percent to 6.8 percent, affecting 7 million students nationally and more than 47,000 Rhode Islanders.
Today, the Senate acted on a procedural motion to end debate on a bill to reverse the doubling, requiring 60 votes to pass. The vote was 51 in favor and 49 opposed.
After the vote, Senator Reed issued the following statement:
Helping students is the right thing to do and a smart way to strengthen our economy. But once again, while a majority of Senators voted to keep student loans affordable, some Senators used procedural tactics to block help for middle-class families.
Todays vote shows Republicans would rather maintain tax loopholes for millionaires than make college a little more affordable for working families.
The student loan interest rate offered by the government shouldnt be needlessly high, it should be based on actual costs. The federal government is projected to make $51 billion in profits this year from student loans and it is unfair for Republicans to ask tomorrows students to pay even more.
Some saw this deadline as a chance to try and do away with important safeguards for students and their families. We wont let them.
I will continue to work hard to reverse this senseless rate hike. We need a comprehensive overhaul to make our financial aid system more effective, affordable, and sustainable. Congress must address the core of the college affordability problem, which means eliminating profits from student loans and alleviating the burden of student debt on existing borrowers through refinancing and better consumer protections.
Ultimately, well need a bipartisan solution, but first Congress will have to do its homework. Republicans will have to come to the table and agree to address the bigger picture of college affordability in a meaningful and comprehensive way.