CBC Hour: Higher Education

Floor Speech

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Mr. VEASEY. Mr. Speaker, once again, we have been pushed to a political standoff over an important issue that affects the future of our nation. On July 1, college students will see the interest rates on their federal loans double. College is becoming less and less affordable each day, and the bill the majority has offered for a vote this week, H.R. 1911 the Smarter Solutions for Students Act, provides no reprieve for college students. In fact, if this bill becomes law, it would make college more expensive for students and their parents than if Congress did nothing and let the interest rates double. It shouldn't be titled the Smarter Solutions Act, but rather, the Making College More Expensive Act.

It is not simply rhetoric or a baseless claim to state that the Republican bill will increase the cost of college. The Congressional Research Service looked at different scenarios where a student or their parent would use a federal loan in order to pay for college and how much that loan would cost under the Republican plan if rates were frozen at 3.4 percent, and if rates were allowed to double to 6.8 percent. Based on projected interest rates, CRS found that the Republican-led H.R. 1911 would increase interest payments under each scenario. If we look at one particular scenario, a student who borrowed the maximum amount of subsidized and unsubsidized loans for five years would see their interest payments increase over the lifetime of the loan by 14.5 percent, compared to allowing fares to double. The Republican plan would cost an astounding 45 percent more than if we froze current interest rates at 3.4 percent.

The Congressional Budget Office also looked at the total cost of H.R. 1911 for families looking to send their sons and daughters to college. They found that over 10 years, H.R. 1911 would cost working families an additional $3.7 billion in interest payments. The federal government should not be in the business of profiting off of the backs of students and their parents. We should be helping them pursue a higher education, not squeezing them for every penny they have.

Let's work together on a common sense proposal that makes federal loans affordable and allows young people to obtain a degree without burdening them with insurmountable student debt. We need real solutions that will help young Americans succeed and make our country stronger.

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