Today, U.S. Senator Richard Blumenthal (D-Conn.) released the following statement in response to the interest rate increase on subsidized Stafford student loans. Interest rates on these loans will double from 3.4 percent to 6.8 percent today -- resulting in an additional $1000 in student loan debt for more than seven million students.
"Shamefully, Congress failed to act before today's deadline on an issue both sides of the aisle should agree on. I call on Congress to return immediately to Washington and pass legislation that will retroactively prevent this de facto tax increase on young people already struggling under mountains of debt. At a time when Americans owe more than $1.2 trillion in student loans debt, the last thing we should do is make college more expensive for students and their families. There is still time to undo this rate increase before borrowers feel its pinch. It is imperative that we act quickly, and show young people across this country that we are committed to easing the student loan debt crisis.
"To that end, I encourage young people everywhere to participate boldly in this process, join my social media campaign for action, and ensure that their voices are heard. Last year, students took to Twitter and Facebook and made the hashtag #DontDoubleMyRate trend nationally. That message successfully forced action then, and it has the power to do so again today. Make yourselves heard, and make Congress listen."
In addition to cosponsoring legislation (S.707) to lock in the 3.4-percent interest rate on subsidized Stafford student loans for two years, Blumenthal is an original cosponsor of the Bank on Students Loan Fairness Act (S.897), which would allow students to take advantage of the same low rates offered to banks through the Federal Reserve discount window, currently at 0.75 percent.