A major element of our Nation's economic recovery is to make it easier for young people to be able to attend college-- and afford it. This is an important component of ensuring our workforce expands, that students pursue secondary degrees, and that tomorrow's employers become better skilled and more able than our rivals around the world.
As of July 1, millions of student loan borrowers could see their interest rates double from 3.4 percent to 6.8 percent. We're in this situation because Washington decided to set the interest rates, not the free market. Now, with the policy expiring at the end of this month, some who have been in the rate price-fixing business don't have a plan to stop dramatic hikes. This formula only guarantees uncertainty for students and leaves them in the crosshairs of infighting in Congress.
The House of Representatives passed, with my support, a bipartisan solution called the Smarter Solutions for Students Act. This plan will allow borrowers to take advantage of market-based rates, with a reasonable cap to protect borrowers when rates are high. In my judgment, the bipartisan House plan is closer to what the President has called for and I believe he is willing to work in a bipartisan fashion to achieve this goal.
The reality for many graduates is crippling debt and underemployment. Students even several years removed from school continue to struggle to pay down their debt while fully integrating into the workforce. This is not a formula for economic success and puts our Nation at a distinct competitive disadvantage.
The House plan will allow students to enjoy predictability and the possibility of lower interest rates. It gives young people the certainty they need to manage their finances and seek gainful employment. The President and the House of Representatives have put plans on the table; the Senate should do the same.