By BEN FELLER, Associated Press
CHAPEL HILL, N.C. (AP) — President Barack Obama went after the college vote Tuesday, pitching cheaper student loans as he courted the one age group where he has a decided advantage over Republican rival Mitt Romney. The twist? Romney, too, has endorsed the idea, though it's unclear whether deficit-leery Republicans in Congress will go along.
In the race for the White House, both the Obama and Romney campaigns see huge opportunities to court younger voters. This week, their efforts are focused on the millions of students — and their parents — who are grappling with college costs at a time when such debt has grown so staggering it exceeds the totals for credit cards or auto loans.
Obama crossed the nation, from the sunny skies of North Carolina to the foothills of the Rocky Mountains in Colorado, to sell his message to college students. Both stops, as well as the one he will make Wednesday in Iowa, came in states vital to his re-election bid.
Trying to make it personal, Obama told students at the University of North Carolina that he and first lady Michelle Obama had "been in your shoes" and didn't pay off their student loans until eight years ago.
"I didn't just read about this. I didn't just get some talking points about this. I didn't just get a policy briefing on this," Obama said. "We didn't come from wealthy families. When we graduated from college and law school, we had a mountain of debt. When we married, we got poor together."
Obama's emphasis on his personal experience set up a contrast with Romney, whose father was a wealthy auto executive. It's a point the president is sure to return to during this summer's campaigning.
Late Tuesday, Senate Majority Leader Harry Reid, D-Nev., introduced legislation that would keep the interest rate for subsidized loans for poorer and middle-class students at their current level for another year at a cost of $5.9 billion. The timing is important because the rate will double from 3.4 percent to 6.8 percent on July 1 without intervention by Congress, an expiration date chosen in 2007 when a Democratic Congress voted to chop the rate in half.
The Federal Reserve Bank of New York has estimated about 15 percent of Americans, or 37 million people, have outstanding student loan debt. The bank puts the total at $870 billion, though other estimates have reached $1 trillion. About two-thirds of student loan debt is held by people under 30.
Members of both parties are assessing ways to cover the costs and then gain the votes in the House and Senate. Both parties have a political incentive to keep the rates as they are.
Senate Minority Leader Mitch McConnell, R-Ky., said Tuesday, "I don't think anybody believes this interest rate ought to be allowed to rise." He added, "The question is how do you pay for it, how long do you do the extension."
Under the Democratic plan, the measure would be paid for by closing a loophole that lets owners of privately owned companies called S corporations avoid paying the Social Security and Medicare payroll tax on part of their earnings. It would apply to such companies with incomes over $250,000. The higher payroll taxes would also be required for some law firms, doctors practices and other professional services partnerships.
Congressional Republicans, however, were panning the idea of paying for the student loan plan with higher payroll taxes on those companies' owners.
"I don't think the temporary interest rate cut should expire this year," McConnell said. "But the way to prevent that is not by raiding Social Security and Medicare while making it more difficult for small businesses to hire college students already struggling in the Obama economy."
Romney said this week that he agrees the loan rates shouldn't be raised, coupling that stance with criticism of Obama's economic leadership.
"Given the bleak job prospects that young Americans coming out of college face today, I encourage Congress to temporarily extend the low rate," Romney said in a statement.
Some conservative activists have denounced Romney's decision to match Obama's position on student loan rates.
"Mitt Romney is going to sell out conservatives in his party" to improve his chances in the November election, Michael Brendan Dougherty wrote in a blog carried by sites including Free Republic.