By Representative Andre Carson
One month from now, 7.4 million students throughout the nation will see the interest rates on their subsidized Stafford loans double. For the nearly 300,000 Hoosiers with these loans, this increase will cost over $219 million more in fees each year.
Totaling nearly $870 million, our nation's unpaid student loan debt now dwarfs credit card and auto loan debt. As a member of the House Committee on Financial Services, I am deeply concerned that this towering debt will hold back graduates and prevent millions of young people from pursuing higher education. I fear that ongoing congressional inaction may exacerbate these challenges and reverse our economic recovery.
College is an indispensable tool for many Hoosiers hoping to achieve the American Dream. At institutions of higher learning, students develop the skills needed to compete in a global workplace, determine their vocations and unlock their passions. Yet, while the financial and civic benefits of higher education are clear to all of us, we face the reality that costs have skyrocketed, and for many Hoosiers this opportunity now depends on the availability of student loan assistance.
It is critical for us to make higher education more affordable. This is why I support Pell Grants to provide more low- and middle-income Americans with access to college. But we need to go farther. Colleges and universities must find ways to keep costs down and we must continue expanding access to financial aid and restructuring federal programs to be more efficient.
As the July 1 deadline approaches and student borrowers look to Washington to prevent a devastating interest rate increase, we cannot succumb to the political posturing and wedge issues that stain election years. Congress must act now to alleviate the burdens on students and recent graduates, not compound the challenges that come with an improving, but still difficult, job market.
House Democrats have proposed a plan that protects the 3.4 percent interest rate for another year and pays for the measure by ending tax subsidies to oil companies -- companies that have prospered even in the lowest points of this recession.
Unfortunately, Republican leadership in the House has a different idea. Instead of working with other members of the House and Senate to come to a reasonable compromise, they used the impending rate increase as a platform to continue their divisive rhetoric against health-care reform, proposing a repeal of the Prevention and Public Health Fund, which has already provided $16.5 million in grants to help Indiana residents fight chronic disease and access health education and wellness services.
My colleagues in Congress need to get their priorities straight. We cannot put our student borrowers at risk just to achieve political points with Big Oil, and we should not be forced to choose between affordable higher education and public health. I am committed to stopping the doubling of student loan interest rates, and I urge my colleagues to put politics aside and join me in this effort.