Should the Lower Interest Rate on Stafford Loans Be Extended?
President Obama toured college campuses this week speaking on the issue of student loan interest rates in what critics say was a partisan appeal to the youth vote. The current interest rate on federal Stafford loans is set to double—from 3.4 percent to 6.8 percent—July 1, as legislation from 2007 to reduce the rate expires. Obama is asking Congress to extend the lower rate another year to help young people pay off student debt, particularly as half of all college graduates leave school unemployed or underemployed. Opponents of the measure, which is expected to cost the government around $6 billion, say the government-subsidized extension will be paid for by tax hikes that would jeopardize the weak economic recovery. Should the lower interest rate on Stafford loans extended? Here is Debate Club’s take: