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Stafford Student Loan Rates

Floor Speech

By:
Date:
Location: Washington, DC

Mr. COURTNEY. Mr. Speaker, unless Congress acts in the next 11 days, the interest rates for the subsidized Stafford student loan program are going to increase from 3.4 percent to 6.8 percent. This is at a time when student loan debt now has topped the $1 trillion number, which is according to the Federal Reserve Bank.

This is a program which will provide relief for over 7 million college students who literally today are already trying to budget for next fall's semester at colleges and universities--at 2-year colleges, at 4-year colleges. Yet this Congress left for 10 days, up until yesterday, for another recess--the ninth recess this year. This number, 11 days until the rate-hike increase, should probably be 6 days because that's all the number of days that the Speaker has scheduled between now and July 1.

How did we get to this point?

In 2007, when the Democrats controlled the Congress, we voted for the College Class Reduction Act, with Republican support, which cut the rate for the subsidized Stafford student loan program from 6.8 percent to 3.4 percent. That has helped over 15 million college kids over the last 5 years. It was a sunset measure, like many other bills that pass in this Congress; and last July 25, on that podium, President Obama challenged this Congress to avoid allowing that rate to double on July 1.

For 3 solid months, we had absolutely no action in this Congress--no hearings, no markup, no bill. Luckily, external pressure was exercised on this Chamber. We had 130,000 college students drop off petition signatures to the Speaker, demanding action. Finally, the Speaker rushed a bill to the floor, without a hearing, without a markup--a totally hyper-partisan bill--that did delay the rate hike for 1 year, yet was paid for with a measure that was so unacceptable: cutting programs and funding for cervical cancer screening, diabetes screening, cardiac screening. It was a measure which was dead on arrival, but at least it was some response. It was at least a flicker of acknowledgment that there was a real problem out there for middle class families around the country.

Now, on January 5, when the President announced his challenge to the Congress, I introduced legislation before midnight that night which would have locked in the lower rate at 3.4 percent. We have 152 cosponsors in the House for that measure, and in the Senate there is a back-and-forth going on right now about a 1-year extension. So, again, there actually are some hopeful signs. Leader Reid, Harry Reid, introduced a measure with a pay-for, which was not greeted with immediate criticism and denunciation, so there is actually a chance that between now and July 1 we can come together and do our jobs and actually be here to work on the people's business and to make sure that, again, 7 million college kids don't see their interest rates spike at a time when student loan debt has shattered all records.

The stakes could not be higher. U.S. graduation rates now have fallen to 12th in the world. We were No. 1 in the 1980s. There are a variety of reasons which explain that, but certainly the high cost of college is one of those reasons. We are seeing now an alarming trend of individuals who take on debt to go to college and then never get their degrees. Debt without a degree is almost a death sentence--a lifetime of struggling in terms of trying to get ahead. We as the Congress have the responsibility to make sure that that doesn't happen or at least that we don't add to the problem by allowing these rate hikes to go into effect on July 1.

Mr. Speaker, if you look historically at the Stafford student loan program, if you look historically at the Pell Grant program, if you look historically at the Land Grant College program instituted by President Abraham Lincoln, this is an issue on which we have always been able to put aside partisanship and move forward together in order to make sure that the real crown jewels of our country, which are our people--particularly our young people--are always protected. That test is now before us over the next 11 days.

Let's do the right thing; let's work together; let's compromise; let's come up with a plan to protect 7 million college kids, and for once send a signal to the people of this country that we are listening and that we are actually responding to the critical needs that face this Nation's future.


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