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Mr. CLARKE of Michigan. I want to thank my colleague, the gentleman from California (Mr. Garamendi), for yielding me time.
My message to our colleagues in the House of Representatives is very clear and direct: we've got to continue to cap student loan interest rates at 3.4 percent.
Student-loan borrowers and their families should not have to pay more on their student-loan debt. The President has done all he can do right now to help bring relief to our student-loan borrowers. Now it's time for Congress to act, but Congress has to do more. We need to reform the system. We've got to change the system. That's why I wrote and introduced the Student Loan Forgiveness Act of 2012. It will help cut student-loan debt, free up borrowers' money so they can invest it on their own. That's a real economic stimulus that will create jobs here in this country.
So I want to thank you again, Mr. Garamendi, for yielding me time.
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Mr. CLARKE of Michigan. Thank you again. And you're absolutely correct. If we keep the student loan burden low on our borrowers--I mean, it's not low; many student-loan borrowers are paying like $1,000 a month on their loans. But the more that our borrowers can keep their money and invest it, start their own businesses--think about it, our students, our graduates are the ones that have the ambition and the discipline to be able to go through school, to graduate. They're likely the ones that would start their own businesses, be entrepreneurs. That's how you build jobs and create financial security for not only our families, but also economic security for our country.
But many of our borrowers right now, they can't take the risk of starting their own business, even starting a family--let alone buying a home--because of student-loan debt. So if we can keep that debt as low as possible, that will help stimulate our economy. It's a great job-growth stimulus.
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Mr. CLARKE of Michigan. Thank you, Mr. Garamendi. And the other point that you're making about student loans and capping these interest rates, how they'll create jobs, that's absolutely right. When our borrowers are freed up to not have to pay these high interest rates, that will create jobs.
Now, some people say, well, the student loan borrower signed the student loan agreement that had the high interest rate on there so they should pay that interest rate, but this is the main point: Those student loans that our government issues to students and to their parents to provide our students with a way to get their education when they can't afford to pay for that education, that's not just to help that student get a degree. Those loans are here to help our country become stronger. Here's why.
The more Americans that we have who are properly trained, who are able to be productive and contribute to our country to their fullest potential, they're able to create more jobs by building the best products, by providing the best services, by developing the best technology that can be sold worldwide. That helps our entire economy. So these loans are to strengthen our entire national economy. It's not just for the borrowers' benefit.
So that's why we don't want these interest rates to be so high. We want to put a cap on them. And in my bill, the Student Loan Forgiveness Act of 2012, I allow virtually every student loan borrower to have a second chance to pay lower rates on their student loan by allowing them to pay down their student loan according to their income. So if they're not making that much money, they don't have to pay much money.
Specifically, my bill would allow borrowers to pay 10 percent of their discretionary income each year, and once they do that for a 10-year period, the remainder of their Federal student loans will be eligible to be forgiven because we want to free up the borrowers' money so they can now invest it, invest it on starting a business, invest it on buying a home, starting a family. All of that will help create jobs.
You see, cutting student loans, keeping the student loan debt low, as low as possible, that's an economic stimulus for all of us. It makes our country stronger. It creates jobs.
Many of us told our kids, and we were also really taught by society, you know, if you work hard, if you study hard, if you go to school, if you even borrow money to get your degree and graduate, you'll live a better life. You'll likely make more money.
Well, because of student loan debt, because it's grown so much, because of the prospect also of interest rates going back up, the American Dream that was supposedly created by the availability of student loan debt has now become a nightmare to many borrowers. And we've got to cut this debt.
This is the real debt, my colleague from California, that we need to cut, because this is the debt that really costs us jobs. We need to cut student loan debt. We can take that initial step right now by keeping student loan interest rates on Stafford loans at 3.4 percent. That's the first step.
Now I'm asking the American people, demand that Congress reform the student loan system. Let's change the system. Let's make it affordable for everyone to be able to get a decent education and to repay that money back.
So again, I thank you for giving me this opportunity to share this time with you and the American people. This is so important.
You know, many times in this body we talk about we've got to cut taxes to stimulate the economy, that we've got to cut debt in order to provide people freedom. Well, what person in this country can be free when they have to personally pay student loan debt that will take them years or even decades, if ever they'll be able to pay that off.
And the reason why I say that is that I know senior citizens now who are still repaying their student loans. And at their age, there's no way they'll be able to pay those loans off. And it doesn't matter if they go bankrupt. Going bankrupt doesn't mean anything. The government will still come after you for all the student loan money because you can't discharge your student loan debt in bankruptcy.
It's a cruel, unfair burden that certain students' loans are imposed on Americans. We need to cut that burden. Cutting that burden is not only fair, but it will create jobs for our country. We want our graduates to be able to have their money to invest, invest on starting their own businesses.
I'm from Detroit. Our city was built up. We built up this country's economy because of entrepreneurs who were able to pursue their dreams. Now the very people that we have trained to pursue their dreams can't do so
because of student loan debt. That's outrageous.
Congress, keep student loan interest rates at 3.4 percent. Cap those rates. Do it now.
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