Sponsored By
An organization or individual has paid for the creation of this work but did not approve or review it.



House Dems to vote on student loans cuts

WASHINGTON The plan House Democrats will push today to slash rates on some student loans falls short of a proposal they pitched nearly a year ago when the Republicans controlled Congress.

WASHINGTON The plan House Democrats will push today to slash rates on some student loans falls short of a proposal they pitched nearly a year ago when the Republicans controlled Congress.

The House Democrats' plan doesn't cover all student loans only federally subsidized Stafford loans targeting some middle-income families and it will take five years to phase in. And though education advocates praise the effort as a nice start, they say it won't do much to boost college access at a time of soaring tuition increases.

Many would rather see Congress focus its efforts on increasing Pell Grants, which focus primarily on low-income families and don't have to be repaid.

Lower payments

The rate cut would be unlikely to encourage more students to go to college, some advocates say, and it doesn't affect students while they're in school. Instead, it would lower monthly payments for college graduates, saving the average borrower more than $4,200 over the life of the loan.


Democrats say the rate cut begins to tackle the affordability issue. Since 2001, tuition has jumped 41 percent at the nation's public colleges and universities and 17 percent at private schools.

In December 2005, Republicans cut $12 billion from the federal student loan program in the budget reconciliation bill. Pell Grants, which go to the neediest students, have been flat for five years.

In March, Democrats wanted to halve the interest rate to 3.4 percent on all student loans. Their effort in the House failed, but it became a campaign issue for the party.

"We should support (students) with a real federal investment in their education not a sham that does not help American students and families pay for college," then-Minority Leader Nancy Pelosi said.

After doing the numbers, Democrats announced this month that they hope to cut rates on just federally subsidized Stafford loans, used now by about 5.5 million students.

Even then, the reductions would be phased in over five years and would cost nearly $6 billion to implement.

"This is a down payment on addressing the college affordability crisis," said Tom Kiley, Democratic spokesman for the House Education Committee. "It is a first step we can take."

'Hypocrisy'Some Republicans labeled the plan "hypocrisy."


"It's a sham and a lie," said Rep. Virginia Foxx, R-N.C., a member of the Education Committee and former community college president. "It wouldn't guarantee that one more student would go to college because of this."

Educators hope Democrats will do more in coming months. The Senate version of the bill comes as part of a larger higher education package and would increase Pell Grants.

The subsidized loans target mostly middle-income families, with about half of the loans going to students in families earning between $26,000 and $68,000 a year, said Bill Parsons, associate director of government affairs at the American Council for Education in Washington.

What To Read Next
Artificial intelligence can now act as an artist or a writer. Does that mean AI is ready to play doctor? Many institutions, including Mayo Clinic, believe that AI is ready to become a useful tool.
Josh Sipes was watching an in-flight movie when he became aware the flight crew were asking for help assisting a woman who was experiencing a medical problem.
Nonprofit hospitals are required to provide free or discounted care, also known as charity care; yet eligibility and application requirements vary across hospitals. Could you qualify? We found out.
Crisis pregnancy centers received almost $3 million in taxpayer funds in 2022. Soon, sharing only medically accurate information could be a prerequisite for funding.