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Mr. KING. Mr. President, I don't have a great deal to add to Senator Manchin's comments except to point out that everyone in this body wants to do best by our students. Everyone understands the importance of education, everyone understands how expensive it is, and everyone understands the problem of the debt burden on our students. We are all trying to search for a solution that can garner bipartisan support and pass the Senate, the House, and go to the President.
The proposal we have put forward before the body today is based upon, in many ways, the proposal made by the President in his budget. It is similar to a provision that has already passed the House. I think a couple of points should be made. One point that should be made is there is a lot of talk about a floating rate. I think people think of mortgages and adjustable rate mortgages where the rate changes from year to year.
Under our proposal, once a student takes out a loan in a given year, at whatever the rate is that year, that rate is fixed for the life of the loan. The following year, if interest rates--and we are talking about the 10-year Treasury bill of the U.S. Government, one of the lowest interest rates there is--go up, then it would go up. That is for next year's loan, not for the loan that has already been taken out.
I think we have learned from our current circumstance the folly of Congress trying to set interest rates. Setting 6.8 percent and 3.4 percent interest rates 5 or 6 years ago looked like a great deal. Today it is generating billions of dollars to the Treasury on the backs of our students.
So I think our solution is a commonsense solution, and that is to base the interest rate for the students at the lowest available rate to virtually anybody in our society, which would be the 10-year Treasury bill, plus 1.85 percent, which protects the Treasury from the costs of administering the program and the risks inherent in the program. If we do that, we will have certainty in the program and the lowest interest rate that would generally be available in this society.
If we started with a blank sheet of paper and said: We want the Federal Government to provide loans to students, I believe we would end up where this plan has ended up. It is where the President ended up, it is where the House has ended up, and I think we have an opportunity. The question is, Should we extend this for 1 year and take more time? I am new, but I stood here during the debates on the sequester, where both parties put forward their proposals, neither party got the votes, and we ended up with a sequester.
We said the exact same thing with student loans about 1 month ago. Each party put forward their proposal, neither party got their votes, and here we are just about at the deadline and the rates are going to double for those subsidized Stafford loans.
I don't know what we are going to know 1 year from now that we don't
know now. I believe the time is now to try to come to a resolution that meets everybody's requirements, and we are not that far apart. The differences separating us in this body are not that far apart. I believe we have an opportunity not only to solve this problem fairly to our students but to demonstrate to the country that we are able to make decisions and not simply delay them for another 1 or 2 years.
That is why I rise to support the bill that Senator Manchin and I, as well as others, including Senator Burr, Senator Alexander--who I think is one of the most respected Members of this body, particularly on education matters--and Senator Coburn. We have a strong bill. I
think as people see the details, understand it better, understand the terms, and understand the effects, we will save students in America over the next 3 or 4 years something like $50 billion. If we don't resolve this problem, it will come into the Treasury on the backs of our students. I don't think that is a result we want.
I think we have a responsible proposal. It is a bipartisan one, and I believe it deserves full and fair consideration. I am sure all of these proposals will have a lot of discussion once we are back in session a week and a half from now, and I hope we can come to a resolution because the students of America deserve to know two things: that Congress has their back on student loans and that their Congress is, in fact, able to make decisions, handle issues, and move forward.
I yield the floor.
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