Keep Student Loans Affordable Act of 2013--Motion to Proceed--Continued

Floor Speech

BREAK IN TRANSCRIPT

Mr. BLUMENTHAL. Madam President, over this past week I had the opportunity to visit with many students, many faculty and staff of our colleges, both private and public, all around the State of Connecticut.

I know the Presiding Officer has led very strongly in this effort. What I found is that students and teachers of Connecticut and around the country absolutely understand how destructive and lastingly harmful this doubling of interest rates will be for people of all ages in America.

Never before has higher education meant more to earning potential and employment, now and in the future. Never before have the faculty, staff, and students of America been more united in their understanding of how critical higher education is--not only to them but to our economy. Our students are the ones who will buy homes, build families, start businesses, and contribute to our economy. They will do more to give back and contribute if they have the great advantages of higher education spared from the financially crippling debt that threatens them now.

In fact, financially crippling debt is a reality for more than 73,000 people who owe an average of $29,000 in Connecticut alone. That debt is a burden for our entire economy as much or more as it is for those individuals. So there is a strong societal and national interest in this issue.

I didn't need to tell the students of Connecticut what the consequences are of doubling the interest rates, and I didn't need to tell them what it would mean for their future. They told me.

They told me at Middlesex Community College, where I spoke to the community college sector--I discussed the issue with the president of that college, Anna Wasescha, along with public officials, students, and financial aid people.

They told me at Northwestern Connecticut Community College, where I spoke with the president Barbara Douglass and individuals there, students and faculty, who noted to me that 51 percent of their students received some kind of financial aid, including Stafford loans.

All around Connecticut I spoke to faculty and students, such as Sam Chaney, who is a 2010 graduate of Quinnipiac. He said to me when students graduate:

..... you're not just paying rent, you're paying as much or more in student loans. ..... I hope they're not in the position I was in, being told not to worry about the sticker price of college.

I heard from Irene Mulvey, the president of the Connecticut chapter of the American Association of University Professors. Her organization is constantly in touch with student borrowers and knows just how much subsidized Stafford loans mean to them. As she said to me, ``As faculty members, we see the impact that student loan debt has on our students and their families every day.'' She called this doubling of interest rates ``indefensible.''

She is correct. It is indefensible, unconscionable, unacceptable. Even at 3.4 percent, as the Presiding Officer well knows, our Federal Government profits from the student loan program. It profits in the amount of $51 billion a year. Doubling the interest rate simply means more profits for the Federal Government.

There is a fundamental principle at stake; that is, whether our Nation is going to continue profiting from student loans, which should be regarded not as a benefit to the students but an investment in our Nation, not as a charitable or eleemosynary program but as a vital investment in the skills and talents and the major resource our Nation has as a free and democratic society, the talents and skills of our people.

Freedom from student debt should be a fundamental national interest as important as any that this body addresses. It is as vital to the future of the country as our national defense.

I did not need to tell the students of Connecticut what this doubling of interest rates would mean to them--$31 a month, $1,000 a year. They know. They do the math. They get it better than people in this Chamber or in the House of Representatives. They told me what the $1,000 would mean to them. Elizabeth Tomasco: ``Textbooks and start saving for my very own car.''

Gina: ``I would use $1,000 to pay for books. Don't double my rate.''

Across Connecticut, students are telling us: Don't double my rate.

I did not need to tell them as well that there are a lot of borrowers in this country who get a pretty good rate, a lot better than 3.4 percent. In fact, those borrowers are the biggest financial institutions, the big banks who borrow from the Federal Reserve at a discount window at less than 1 percent--.75 percent often.

They are angry about it; that they are worth less in these financial markets, in the view of our Federal Government that loans money, than the big banks and big institutions that, in fact, are sometimes regarded as too big to fail. Students are failing to pay back those debts, but the nation is failing our students and it is failing itself because our national interest is in the student loans and talents and skills and opportunity it provides, not just in the next year or couple of years but for a lifetime and for the long term of our Nation.

I am a proud supporter of the Bank on Student Loan Fairness Act, which would give them the same kind of fairness, equivalent fairness that our big banks enjoy when they borrow from the Federal Reserve. But in the meantime, we need a solution for this next year, and it is the Keep Student Loans Affordable Act. It is a remedy of short duration, I hope, that will in the end be accompanied and followed by longer term reforms that will give students the benefit of those lower rates, lower even than 3.4 percent, so our Federal Government ceases to use students as a profit center and ceases to take advantage of them.

I am not against smart cuts to reduce our debt and our deficit. These kinds of burdens on students, using them as a deficit solution, is not a smart cut. That is an understatement. In the long term, we need to reduce the cost of higher education, which has increased over the last few decades by 1,000 percent. That is the result of year after year overinflationary increases in tuition which over time have managed to make a college degree unaffordable to all but the most well off unless they use that kind of financially crippling debt to attend.

The age of supporting oneself through a 4-year college degree is past for most. This unfortunate trend has been coupled with more and more employers requiring a bachelor's degree for even consideration in the hiring pool. So the doubling of interest rates is indeed indefensible, as Irene Mulvey told me. It is indeed unacceptable in the greatest nation in the history of the world--which must continue the quality and affordability of higher education if we are to remain the greatest nation in the history of the world.

I hope my colleagues will join the Members of this Senate who have supported the Keep Student Loans Affordable Act and will support a reasonable measure keeping these rates at 3.4 percent. To allow variable rates and, in effect, teaser loan levels that can rise beyond affordability, without caps, without protection is, in fact, against the national interest. This measure will help us keep students in school and spare them the kind of financially crippling debt that all too many of our young people have when they leave college.

I yield the floor. I suggest the absence of a quorum.

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