Statements on Introduced Bills and Joint Resolutions

STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS -- (Senate - January 12, 2007)

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By Mr. DURBIN (for himself and Mr. KENNEDY):

S. 282. A bill to-amend the Higher Education Act of 1965 to reduce over a 5-year period the interest rate on certain undergraduate student loans; to the Committee on Health, Education, Labor, and Pensions.

Mr. DURBIN. Mr. President, I rise today to urge my colleagues to support the ``College Student Relief Act.' In 1958, spurred on by the launch of the Russian satellite, Sputnik, Congress passed the National Defense Education Act in order to ensure that through education, the United States would stay ahead of the Soviet Union in the space race. Because of the low interest loans offered through the National Defense Education Act, countless students were able to obtain a college education and help move America forward. I could never have attended Georgetown University and law school were it not for the government loans.

It is unquestionable that higher education plays a critical role in the future of our children. Over the course of a lifetime, a college graduate will earn over $1 million more than those without college degrees. In addition to the individual benefits of a college education, investing in and producing more college-educated Americans is vital to our Nation's growth. Economists estimate that the increase in the education level of the United States labor force between 1915 and 1999 directly resulted in at least 23 percent of the overall growth in U.S. productivity. To keep America at the economic forefront in the 21st Century, we must recognize the value of investing in higher education and provide students with the assistance they need so that they can compete in the global economy.

As college costs continue to skyrocket, attaining a college education is becoming an even bigger hurdle for many American students. Millions of eligible students never even make it to college because of financial barriers. Over the last five years, tuition, fees, room and board at four-year public colleges and universities increased by 42 percent. More than two-thirds of four- year college students now borrow to pay for school, and their average debt more than doubled between 1993 and 2004. According to the Congressional Advisory Committee on Student Financial Assistance, financial barriers will prevent 4.4 million high school graduates from attending a four-year public college over the next decade, and prevent another two million eligible students from attending college at all.

Last year, Republicans missed an opportunity to prevent higher student loan interest rates from going into effect. On July 1, 2006, student loan interest rates went from a 5.3 percent variable rate to a 6.8 percent fixed rate for student borrowers. We can address this situation and take the first step towards helping millions of college students across the Nation realize the American dream--achieving a college education.

That's why I'm introducing the College Student Relief Act of 2007. The bill cuts interest rates on subsidized student loans in half and will help lower the interest rates for 5.5 million college students. The bill phases in interest rate cuts over five years, from a 6.8 percent fixed rate to a 3.4 percent fixed rate for undergraduate borrowers of new subsidized student loans. Once fully implemented, these cuts will save the typical borrower--with $13,800 in need-based loan debt--approximately $4,400 in interest costs over the life of his or her loan.

Smart, hard-working kids deserve a chance to go as far as their talents will take them; however, large education debt changes the future in ways that cannot be quantified. Career plans are changed. Lifestyles are restricted. Home and auto purchases are put on hold. Family plans may be delayed to accommodate debt payments.

Let me share a few stories with you that illustrate the effects of carrying large education debt. When Stacie Odhner-Sibley and her husband made the decision ten years ago that she would go back to school and obtain her Bachelor's degree in order to provide a better future for their family, she was the first in her family to go to college. Fast forward to today. Stacie now has her Bachelor's degree and a Master's degree in School Guidance and Counseling. While this is the happy part of Stacie's story, the sad part is that Stacie and her husband are considering uprooting their three children and selling their home because they can't afford both student loans and a mortgage. The saddest part of Stacie's story is that the money her family would realize from the sale of their home won't even pay off the student loans. It will only be enough to take off some of the financial pressure they otherwise would be feeling.

Katie Miller is a student at Southern Illinois University at Edwardsville. Katie's story is not uncommon. She works part-time and her parents are unable to provide her with any financial assistance. She is extremely grateful for the financial aid she receives and recognizes that without it, she would not be able to go to school even though she is struggling to pay for food, insurance and other basic necessities.

Summer Boyd is an elementary teacher in Decatur, IL. She graduated from Millikin University in 2003 with $65,000 in student loans. As with Katie, Summer's parents could not afford to help pay for her college education. So, for the next 25 years, Summer will be paying over $500 each month toward her student loans. She doesn't mind paying for her education; however, the heavy burden of her student loan debt is already affecting her future plans. She and her husband want to have children, but for the time being, they must continue to scrape by each month and can only hope to someday be able to afford children.

Young people like Stacie, Katie and Summer should not face such high penalties because they had the desire and determination to pursue higher education.

An investment in our children's education is an investment in our Nation's future. We must do what we can today to ensure that America remains a global leader in the future. Our Nation will be richer--not just economically, but also culturally and socially--for having given a higher priority to making college affordable.

I ask unanimous consent that the text of the bill be printed in the RECORD.

There being no objection, the text of the bill was ordered to be printed in the RECORD, as follows:

S. 282

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