Congressman Frank Pallone, Jr. (NJ-06) met with student leaders today at Rutgers University to discuss college affordability and potential student loan interest rate hikes. Unless Congress takes action, Stafford student loan interest rates will rise from 3.4% to 6.8% on July 1, affecting seven million students nationwide, including nearly 144,000 students in New Jersey.
The Republican budget passed in the House allows lower student loan interest rates to expire. Yielding to public pressure, in a reversal from their previous budget stance, House Republicans passed a bill last week that prompted a veto threat from President Obama, which sustains current student loan interest rates by raiding funds from the Affordable Care Act intended to cover prevention and women's health programs
"Higher education is the clearest path to the Middle Class, which is why we must prevent student loan interest rates from doubling in July," said Pallone. "The Republican proposal to raid funds set aside for health programs for women and children in the Affordable Care Act is a political game, not a practical solution to protecting college affordability for millions of students."
Democrats have proposed ending tax subsidies to large, highly profitable oil and gas companies to keep rates on college student loans from doubling and help pay down the deficit. Congressman Pallone has cosponsored H.R. 3826, the Democrat's bill to maintain the reduced interest rates for student loans.
The House Republican budget also reduces Pell grants by about $200 billion over the next ten years, which would cause more than one million students to lose Pell grants entirely over the next decade. Today, more than 16,000 Rutgers students rely on Pell Grants, which provide over $65 million annually towards their education.
"College access and affordability should not be a partisan issue," said Pallone. "We can help keep college affordable without cutting health care to women and children. Forcing a choice between the two is wrong and unnecessary."