Entries in Interest Rates (4)


Differences Persist in Congress’ Struggle to Extend Student Loan Rate

iStockPhoto/Thinkstock(WASHINGTON) -- The top congressional leadership was out in full force on Thursday as leaders from both political parties in both chambers of Congress promoted the position of their respective caucuses in the latest battle over congressional funding on Capitol Hill.

At issue is finding an amicable way to pay for or offset the costs of extending the current student loan interest rate of 3.4 percent, rather than permitting the rate to double on July 1 to 6.8 percent.

Republicans and Democrats have both proposed alternative methods to cover the cost of the extension and, judging by their comments on Thursday, a huge gulf remains between the two parties.  While House Speaker John Boehner, R-Ohio, announced on Wednesday that the House would vote Friday on a one-year extension that is paid for by pulling funds from the president’s health care law, Democrats prefer to raise taxes on small businesses in order to cover the $6 billion expense.

Senate Majority Leader Harry Reid, D-Nev., said he was “very disappointed” in Boehner’s plan to hold a vote on the GOP’s bill Friday, telling reporters that covering the cost by pulling from preventive health care funds “doesn’t sound like a very good deal to me.”

“We simply want to renew this, and it’s the right thing to do.  This affects seven million students.  They’ll get an average of about $1,000 a year increase in their interest and that’s a lot [for those] struggling to get through school,” Reid told reporters Thursday on Capitol Hill.  “We believe there’s an easy solution.  We can pay for this with a tax that people who make a lot of money have been avoiding for a long time by changing from ordinary income, they put this into sub-chapter S and avoid taxes.”

New York Democratic Sen. Charles Schumer, the number three ranked Democrat in the Senate, said that the House’s way of paying for the rate is a “poison pill” that stands no chance of passing the Democrat-controlled Senate.

“If it’s true Republicans support stopping the rate hike, they have a weird way of showing it.  In the House, the proposal they’re advancing has a poison pill attached to it,” Schumer said.  “Their offset is a partisan proposal that tries to refight the debate over the president’s health care law.  That’s not a serious attempt to pass this student loan bill.”

Schumer complained that Republicans are attempting to force Democrats to “choose between helping students afford college tuition or forcing women to go without mammograms.”

“They want to give to the middle class, but only when they take from the middle class and that’s because they don’t want to touch their true constituency, the wealthiest people in America who at every turn they try to make their lives even better,” he said.  “They’re not the people who need help in America.”

Copyright 2012 ABC News Radio


Pelosi: GOP Plan on Student Loan Rate ‘Assault on Women’s Health’

JEWEL SAMAD/AFP/Getty Images(WASHINGTON) -- House Minority Leader Nancy Pelosi railed against Republican efforts to offset the one-year extension of the 3.4 percent student loan rate by taking money out of a fund she believes is imperative to the “survival to women.”

Pelosi told reporters that she is whipping her caucus to oppose the GOP’s proposal.

“We will not support a bill that robs Peter to pay Paul, which ostensibly supports a middle-class initiative while making those very same people pay for it,” Pelosi, D-Calif., said Thursday during her weekly news conference on Capitol Hill.  “In order to pay for it, [House Republicans] are going to make an assault on women’s health, make another assault on women’s health, continue our assault on women’s health and pay for this with prevention initiatives that are in effect right now for childhood immunization; for screening for breast cancer, for cervical cancer; and for initiatives to reduce birth defects -- a large part of what the Center for Disease Control does in terms of prevention.”

The Democratic leader said the funding that Republicans hope to use to pay for the extension, which will come up for a vote in the House on Friday, is integral to the “survival to women.”  House Speaker John Boehner has labeled the same prevention fund a “slush fund.”

“Well, it may be a slush fund to him, but it’s survival to women,” Pelosi said.  “It’s survival to women.   And that just goes to show you what a luxury he thinks it is to have good health for women.  We do not agree.”

Copyright 2012 ABC News Radio


Obama: College Debt ‘Not Something I Read About in Briefing Book’

Alex Wong/Getty Images(BOULDER, Colo.) -- President Obama Tuesday night cast himself as a champion of an affordable college education and drew a veiled contrast with Republican rival Mitt Romney in a speech before an electrified crowd at the University of Colorado.

Calling a college education the “best tool you have to achieve the American promise,” Obama made the case to the crowd of 10,800 students that he best understands the challenges of earning a degree.

We “didn’t come from well-to-do backgrounds.  We didn’t have famous families,” the president said of his upbringing and that of his wife, Michelle Obama.

“But it wasn’t just that we worked hard, it was that somebody made an investment in us.  That’s what America did for us,” he said.

Though he never mentioned presumptive GOP nominee Mitt Romney by name, Obama was keen to underscore that he did not come from a prominent family with a significant wealth.

“Michelle and I -- we know about this first-hand,” Obama said of the struggle to manage student debt.  “This is not something I read about in a briefing book.  This is not something abstract to us.  We’ve been in your shoes.”

The president is lobbying Congress to extend current interest rates on federal Stafford loans, which are set to double, by law, on July 1.  More than seven million college students would face an average $1,000 hike in their payments per year if the extension is not passed, the administration says.

“They have to prevent the interest rates on student loans from shooting up and shaking you down,” Obama said, drawing applause from the supportive crowd.

“Stopping this should be a no brainer,” he added.  “We need to send a message to folks who don’t seem to get this.  That setting your sights lower -- that’s not an education plan.  You’re on your own -- that’s not an economic plan.”

The rally-style speech inside the school’s Coors Events Center was the second stop on Obama’s three-state battleground tour aimed at appealing to the student vote.  He spoke at the University of North Carolina-Chapel Hill earlier on Tuesday and was to head to the University of Iowa on Wednesday.

Copyright 2012 ABC News Radio


GOP Bash Obama on Student Loans Ahead of His College Tour

SAUL LOEB/AFP/Getty Images(WASHINGTON) -- President Obama on Tuesday begins a two-day tour of college campuses in three battleground states -- North Carolina, Colorado and Iowa -- in which he will press Congress to extend the 2007 law that keeps interest rates on student loans at a lower rate of 3.4 percent.  If Congress doesn’t extend this lower rate, rates will double on July 1 to 6.8 percent.

“Nearly seven and half million students will end up owing more on their loan payments,” the president said in his weekly address.  “That would be a tremendous blow.  And it’s completely preventable.”

As the president prepared for his push, which Democrats hope will also shore up support for the president among younger voters, a group among where enthusiasm for Obama has been lagging. Republicans on Capitol Hill noted that then-Sen. Obama seemed to make the lower interest rates for student loans a lower priority.

When the bill came up for final passage on Sept. 7, 2007, then-Sen. Obama did not vote; he was campaigning for president in California and Oregon.

“It seems not much has changed,” said Brendan Buck, spokesman for House Speaker John Boehner, R-Ohio.  “Five years ago, just like today, the president put campaigning before governing.  As a result, 50 percent of new graduates can’t find full-time employment in this economy.”

White House officials noted that at the time Senate Majority Leader Harry Reid, D-Nev., told the Senate Democrats running for president -- which included not just Obama but then-Sens. Hillary Clinton, D-N.Y., Joe Biden, D-Del., and Chris Dodd, D-Conn. -- that he would call them back from the campaigning if their votes were needed.  But they were not for this bill, which passed 78-18.  (Clinton, Biden and Dodd were also no-shows.)

“It’s no secret that Barack Obama ran for President in 2007,” said Obama campaign spokesman Ben LaBolt.  “And it’s no secret that he has doubled funding for college scholarships and fought Republican attempts to increase the debt burden for students.”

LaBolt noted that then-Massachusetts Gov. Mitt Romney also ran for president in 2007, saying the presumptive GOP presidential nominee “was outside of the state of Massachusetts for 212 days his final year in office.”

For his part, Romney on Monday supported the president’s push to extend the lower interest rate for student loans, issuing a statement saying: “Given the bleak job prospects that young Americans coming out of college face today, I encourage Congress to temporarily extend the low rate.”

Copyright 2012 ABC News Radio

ABC News Radio