Legislation co-sponsored by U.S. Senator Debbie Stabenow to keep student loan interest rates low was blocked today by a Republican filibuster. Republicans filibustered a similar bill earlier this year, allowing the interest rate on student loans to double from 3.4% to 6.8% on July 1. Senator Stabenow's Keep Student Loans Affordable Act of 2013 would have retroactively reversed the rate hike and ensured that student loans remain at 3.4 percent while Congress works on a comprehensive plan to reduce student loan debt for every student.
"At a time when too many Michigan students and families are strapped with tens of thousands in student loan debt when they graduate, we need to be making college more affordable, not raising rates so the government makes a profit off of students," said Stabenow. "Some want to see student loan rates double in an effort to pay down the debt on the back of our students while protecting special interests. It is absolutely critical that Congress come together and pass legislation to reverse this rate hike and begin work on a long-term plan to make college more affordable for every student."
Without Congressional action to reverse the rate hike, the government is estimated to make a $51 billion profit off of students and their families. In Michigan, nearly 300,000 students will be hit with an average increase of almost $1000 per loan. The average student debt for Michigan students in approximately $26,000.
Unlike proposals that would balance the budget on the backs of students by making future loans much more costly, Sen. Stabenow's legislation would help ensure that college remains within reach for students who rely on federal loans to pay for their education. Senator Stabenow championed similar legislation in 2012 to keep the student loan interest rates at 3.4 percent for one year, which President Obama signed into law.
In 2010, Senator Stabenow led the effort to reform the student loan program and expand college access. These reforms made lending initiatives more efficient and increased Pell Grant funding to make college more affordable for students and middle-class families.