Each year, millions of American students rely on the federal student loan program to pursue higher education. For many families, without the ability to pay for their students' education over a longer term, college would simply be out of reach.
Affordable interest rates on federal student loans provide opportunities for our young people to pursue higher education so they can work toward their American Dream, while boosting our economy as our schools prepare the next generation of small business owners, doctors and engineers.
Despite all that, on July 1, the interest rates on federally subsidized student loans doubled, from 3.4 percent to 6.8 percent.
Something had to give. In the face of the crisis, members of Congress had three initial options:
1) Support the Republican bill, which could never pass the Senate;
2) Support the Democratic bill, which could never pass the House; or
3) Kick the can down the road and let someone else deal with it later.
Well we've kicked the can down the road so much my toe hurts. Each option was ultimately a dead end in which American students, families and the economy suffered.
Plainly, it was unacceptable.
Thankfully, we were able to avert it in the Senate. We initiated something all too rare in today's polarized, gridlocked Congress: dialogue, compromise and bipartisanship. Once we started talking, we realized our disagreements weren't as great as they're often made out to be. We coalesced around shared principles and came up with the Bipartisan Student Loan Certainty Act, which is a strong, common-sense solution.
Our Senate-passed bill does four important things:
- It immediately cuts rates nearly in half for all students who took out loans after July 1, 2013.
- It saves students $8 billion in 2013 and $31 billion over the next four years.
- For the average student, it saves $2,000 over the life of the loan.
- It provides a permanent solution to a major problem that has been hanging over the heads of students and families.
It passed the Senate with a strong, bipartisan majority, 81-18. This is the only proposed option that can get through Congress.
Now that the Senate's acted, it's the House's turn to step up to the plate. That is why I am asking parents and students to ask their Representative to support this common-sense compromise.
Without passing the Bipartisan Student Loan Certainty Act, we're at risk of college becoming more expensive for millions and out of reach for many. This bipartisan, permanent fix lowers interest rates for all students, especially the poorest, while also putting in place strong protections to ensure that student loan interest rates never become unaffordable. It shows that when we put our country first, we can do the right thing.
And that's what the American people expect and deserve.