House Votes to Maintain Low Student Loan Interest Rates

The measure would stave off a scheduled rate hike, but the White House is threatening a veto

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The House of Representatives voted 215-195 Friday to keep interest rates on federally subsidized student loans at 3.4 percent. Without congressional action, those rates will double to 6.8 percent on July 1.

There is some bipartisan agreement on maintaining the lower rate, but members of Congress disagree strongly on how exactly to do it. Extending the 3.4 percent rate is expected to cost around $5.9 billion, and the Republican bill that passed on Friday proposes paying for the rate cut by taking money from the Prevention and Public Health Fund created by the healthcare reform law.

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The White House has threatened to veto such a bill.

"This is a politically motivated proposal and not the serious response that the problem facing America's college students deserves," said a White House statement.

The fund pays for community and preventive health programs, like hiring and training doctors, as well as preventing obesity and tobacco use.

House Minority Leader Nancy Pelosi this week connected the issue into the larger "war on women" which Democrats have been accusing Republicans of waging in recent weeks.

"We will not support a bill that robs Peter to pay Paul, which ostensibly supports a middle-class initiative while making those very same people pay for it," Pelosi said, as reported by ABC News. "In order to pay for it, [House Republicans] are going to make an assault on women's health, make another assault on women's health, continue our assault on women's health and pay for this with prevention initiatives that are in effect right now for childhood immunization; for screening for breast cancer, for cervical cancer; and for initiatives to reduce birth defects – a large part of what the Center[s] for Disease Control does in terms of prevention."

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In a floor speech on Friday, Speaker John Boehner again characterized the public health program as a "slush fund," as he had called it earlier this week. He also attempted to take the high road: "Ladies and gentlemen, this is beneath us. This is beneath the dignity of this House."

The Democrat-controlled Senate, meanwhile, has its own similar version of the bill, but would pay for maintaining the lower interest rate by boosting how much the owners of some private firms pay in payroll taxes.

Student loans have become a major political flashpoint in this election year. The topic galvanizes many voters, and has been a top priority for the Occupy movement. Conservative advocacy group Club for Growth vocally opposed the measure, as the Washington Post noted, saying that a "yes" vote would count against members of Congress on its scorecard rating system. President Obama has also strongly advocated for keeping the rate low, taking his student loan message on a college tour this week, as well as to Late Night with Jimmy Fallon, where the president famously "slow-jammed" his views on the matter.

Danielle Kurtzleben is a business and economics reporter for U.S. News & World Report. Connect with her on Twitter at @titonka or via e-mail at dkurtzleben@usnews.com.