On Friday, the House will vote on a Republican bill to keep Stafford student loan interest rates at 3.4 percent. The $5.9 billion proposal would be paid for by cutting money from President Obama's healthcare overhaul.
House Speaker John Boehner announced the vote Wednesday at a hastily arranged news conference. House Republicans plan to fund a one-year continuation of the interest rate cut with money from a $17 billion fund created by Obama's healthcare law for immunization and wellness education.
Senate Democrats have a plan of their own to keep the Stafford interest rates lower. Their plan, introduced Tuesday, would pay for a one-year interest rate cut by increasing Social Security and Medicare payroll taxes on the top earners and owners of some privately held corporations.
Obama has been touring the country this week, visiting college campuses with a message about how his administration is focused on keeping college affordable. He has warned that if Congress does not act, a four-year temporary interest rate cut will expire on July 1, sending Stafford loan interest rates to 6.8 percent overnight.
"Just to give you some sense of perspective—for each year that Congress doesn't act, the average student with these loans will rack up an additional $1,000 in debt," Obama said Tuesday during a speech at the University of North Carolina. "That's basically a tax hike for more than 7 million students across America...Anybody here [who] can afford to pay an extra $1,000 right now?" In a press release last weekend, the president blamed Republicans for working against ways to make college more affordable.
While the two sides seem to agree that Stafford interest rates should not be allowed to double, Boehner's announcement of the house vote was definitely not the heralding of a new bipartisan era. He told reporters that Obama has been "trying to invent a fight where there wasn't and never has been one." He continued, saying, "What Washington shouldn't be doing is exploiting the challenges that young Americans face for political gain."
- Read Women May Have Tougher Time Paying Student Loan Debt Due to Gender Pay Gap.
- Read Obama, Romney Agree on Extending Student Loan Interest Rate Cut.
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Brian Greene writes about politics for U.S. News & World Report. You can contact him at email@example.com.