By BEN FELLER and KIMBERLY HEFLING, Associated Press
WASHINGTON (AP) — Pivoting to his latest election-year theme, President Barack Obama will go before college crowds in three swing states to warn of financial doom for millions of students if Congress does not halt a looming spike in interest rates. His clear political mission: rallying young voters whose support he needs again.
Obama's trip next week will take him to the University of North Carolina at Chapel Hill, the University of Colorado at Boulder and the University of Iowa. All three provide him potentially giant audiences in states he carried in 2008 and ones that are key to his re-election prospects against presumptive opponent Mitt Romney.
The issue at hand: Interest rates are set to double on July 1, from 3.4 percent to 6.8 percent, on a popular federal loan for low- and middle-income undergraduates.
Congress voted in 2007 to drop the rate in half over four years. Now the looming expiration is an election-year issue.
It was Obama's fellow Democrats in the House, however, who led the crafting of a law that left the rates to double in 2012. Republican President George W. Bush signed the deal into law after it was approved by bipartisan but Democratic-heavy majorities in both chambers.
For Obama, the matter gives him a platform to position himself as a defender of the middle class or those working to make their way into it. He is shifting from the issue of tax fairness, which he has hammered for weeks, to education in front of young voters who helped fuel his winning coalition in 2008.
The partisan flavor of the debate is all but sure to be on display at Obama's college events, which are likely to feel more like re-election rallies.
The White House insists Obama's events are driven by the need for college affordability and his view that education is an economic cornerstone.
Education Secretary Arne Duncan said more than 7 million students would be financially squeezed if rates go up, to the cost of an additional $1,000 on average.
"More and more middle-class families are starting to think college might not be for them," Duncan said. "It's for rich folks. That's a real problem."
Another problem: The cost of keeping the interest rates frozen on these subsidized Stafford loans could run $6 billion a year.
It is unclear how that cost would be paid. Duncan said the administration will work with Congress on the answer.
For now, the White House is pushing a one-year extension, not a permanent fix.
The proposal faces a shaky future in Congress. Republican Rep. John Kline of Minnesota, chairman of the House Education and the Workforce Committee, said in a statement that "bad policy based on lofty campaign promises has put us in an untenable situation."
"We must now choose between allowing interest rates to rise or piling billions of dollars on the backs of taxpayers," Kline said.
Mark Kantrowitz, publisher of fastweb.com and finaid.org, said Obama wins politically on the issue even if Congress doesn't go along.
"If this is enacted, President Obama can claim a victory on a pocketbook issue that is of interest to a key voting demographic," he said. "If it's not enacted, he can blame the Republicans, his opponents, for doubling the interest rates."
Polling shows Obama holds a sizable lead over Romney among registered voters under 30. In Obama's first run for the White House, young voters helped him carry GOP-leaning states like North Carolina and Indiana thanks to major voter registration drives on college campuses.
Obama campaign officials have estimated a universe of about 8 million voters between the ages of 18 and 21 who weren't old enough to vote in 2008 but could be tapped to support the president this time.
Yet Obama may be a tougher sell to young people this time.
The president carried voters between the ages of 18-29 by a margin of about 2-to-1 in 2008, but many recent college graduates have faced high levels of unemployment, raising concerns about whether they will vote in large numbers for Obama again.
Obama's 2012 college campus tour has already included stops at the University of Michigan, the University of Miami, Ohio State University and Florida Atlantic University. Obama has also traveled to community colleges in New Hampshire, Ohio and Virginia this year.
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