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Border Security, Economic Opportunity, and Immigration Modernization Act--Continued--

Floor Speech

By:
Date:
Location: Washington, DC

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Ms. WARREN. Madam President, in less than 3 weeks the interest rates on subsidized student loans will double if Congress fails to act. This is not only wrong, it is unnecessary. Senator Harkin and Senator Reed have proposed a plan to hold the interest rate steady at 3.4 percent for 2 years. This will give Congress time to develop a long-term plan to address the rising burden of student loan debt, a long-term plan that keeps interest rates low and that addresses rising college costs.

Two weeks ago a majority of Senators in this body voted to approve this temporary extension to provide a measure of relief to our families. Unfortunately, Republicans have decided to filibuster this bill, blocking the measure that has majority support. That is not the way our democracy should work.

I met with students in Massachusetts earlier this week. They told me we need to fix this problem. They said to me: Do not double my rate. Do not double my rate. Dozens of Massachusetts universities have asked us to step in and help their students. Petitions urging us to stop interest rates from doubling on July 1 have collected more than 1 million signatures. Students, parents, families are asking for help. They do not have time for politics.

I ask unanimous consent that at a time to be determined by the majority leader, following consultation with the Republican leader, the Senate proceed immediately to the consideration of Calendar No. 74, S. 953, the Student Loan Affordability Act, and that the bill be read a third time, the Senate proceed to vote on passage of the bill, and the motion to reconsider be considered made and laid upon the table, with no intervening objection or debate.

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Ms. WARREN. Reserving the right to object, I would like to focus on three words Senator Burr discussed, and they are ``unsustainable,'' ``everybody,'' and ``fix.''

I heard all three, and I think all three are very important words here. Let's go through this and figure out what it is the Senator is proposing and what it is we need to do.

Right now we have a student loan program that produces $51 billion in profits this year off the backs of our students, $51 billion. Yes, I think that is unsustainable. We must find a way to deal with that.

In fact, Republicans did put a proposal on the table. Their proposal would have increased profits to the Federal Government from the student loan program by another $16 billion.

The Republicans' plan was to say let's take a debt load that is already too difficult for students to deal with and let's make it harder. That is, in my view, completely unsustainable. We have to do better than that.

The question the Senator also raises is one about everybody: We need to fix this problem for everybody. I agree with the Senator. We do, indeed, need to fix this problem for everybody. Let's think about what this is.

What we are talking about is student interest rates that are about to double. What the Democrats have proposed, what I propose in the original request for a UC, is that we not let those interest rates double. We use that time to try to develop a comprehensive way to deal with the rising costs of college and with the trillion dollars of college loan debt that is outstanding.

In other words, we recognize this is a narrow slice. This is to prevent our students from facing a double interest rate, a doubling of their interest rates on July 1. We say we would use this time in order to get a comprehensive answer for all of our students.

What the Senator has proposed and what he has asked for unanimous consent on is not that. It is only a narrow slice of the question of how we are going to deal with interest rates on loans going forward. It doesn't deal with the interest of the loans outstanding, and it certainly doesn't deal with the rising costs of college. They want to put this problem to bed by saying that one problem we will deal with and we will move on. Let's keep in mind we have seen what the Republican plan will do. The Republican plan will cost our students an additional $16 billion. That is the plan. Take a problem and make it worse but not something that is sustainable and not something that fixes it for everyone.

The third point he raised is he used the question of fix. I think fix is exactly what we are talking about.

We have three different kinds of problems we need to solve. We have the problem of $1 trillion of outstanding student loan debt that is crushing our students. We have the problem of rising costs for college. We must deal with this. We have the immediate problem of interest rates about to double for our students.

We can fix one of those problems in the next 2 weeks. We could fix it today. We could fix it by unanimous consent right now.

Then we could agree to sit down, on a bipartisan basis, and we could work together to try to solve the larger problems. That is what our students are asking for. That is what we need to do.

One last point I wish to make, I notice that Senator Burr cites the Congressional Budget Office study. Let's just be clear what that same study decided right from the beginning. The Congressional Budget Office projects the total cost to the Federal Government of student loans disbursed between 2013 and 2023--I believe that is what the Senator was referring to--will be negative; that is, the student loan program will produce savings that reduce the debt. Don't let anyone be confused by what that language means--produce savings that reduce the debt--meaning our kids have become a profit center for the Government. Right now this government will lend to large financial institutions at less than 1 percent interest, but the plan has continued to produce profits off the backs of our kids, and not small profits, tens of billions of dollars of profits.

There is $51 billion projected this year. The Republicans are asking for another $16 billion. We can't do that.

We need a sustainable answer. We need a fix that encompasses all of our students, all of our families.

For that reason, I object.

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Ms. WARREN. I believe, if I understand this correctly, what we are trying to do is protect the subsidized Stafford loans. What I understand the Republicans have tried to do is protect all the new loans so no one is dealing with all the loans that already have been issued and are at much higher interest rates. This is how I understand it. If the Senator is talking about wanting----

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Ms. WARREN. Then I assume the Senator means all the students with student loan debt, and that is not my proposal.

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Ms. WARREN. Will the Senator yield for a question

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Ms. WARREN. I wish to make sure I understand. Have the Republicans put any proposal on the table that will deal with all of the outstanding student loan debt?

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Ms. WARREN. I just wanted to return to this question, since the Senator has raised it, about the Congressional Budget Office. Let's all be clear about what the current student loan interest rates produce for the government.

The CBO, the agency in charge of estimating these costs for the government, maintains that this year the government will make $51 billion in profits from the student loans. Their most recent report on this--I read the language earlier--is clear and direct. We will make a profit.

The CBO uses this accounting method because it reflects reality. It is the reality of how these loans affect the Federal budget. The CBO's method takes into account the cost of lending money from the Treasury and the projected money that will be returned to the Treasury.

It takes into account the risk that some students will default; in other words, it is basic math.

Some people don't like the idea that the government is profiting from the student loans. Their approach is to try to change the accounting rules to treat the government as if it were a private bank rather than the Federal Government, which it is.

The government is not a bank in a private market. If we want to reduce the profits from student loans, then we should actually reduce the profits from the student loans, not change the map, not bury our heads in the sand and pretend those profits don't exist.

Let's go back to what the Senator has proposed. The Republicans propose that we take $51 billion in profits that will currently be made from the backs of our students and add another $16 billion in profits off the backs of our students. This is fundamentally wrong. It is not sustainable.

I think the larger point the Senator makes is one that says we have a big problem. We need to talk about the debt that is outstanding. We need to talk about how we are going to pay for college over time. We can't do that in the next 2 weeks.

We need to make sure interest rates don't double, and then we need to address this problem. I am pleased to work with people on both sides of the aisle.

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Ms. WARREN. No.

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Ms. WARREN. Look, we can go back over the CBO numbers, but what is clear right now is what the CBO has made clear. We will make $51 billion in profits off the backs of our students. The Republicans propose to make another $16 billion off the backs of our students. We can't do that. It is unsustainable. Our students are asking for more.

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