Warren, Sen. Brown: Stop Student Loan Rate Hike
BOSTON — Democratic Senate candidate Elizabeth Warren today called on Congress to prevent the scheduled doubling of interest rates on subsidized student loans.
The AP provides background on the issue:
Rates on federal Stafford loans for low- and middle-income undergraduates are set to double [on July 1] from 3.4 percent to 6.8 percent. … Congress voted in 2007 to cut the rate in half over four years. The cost of keeping the interest rates frozen could come to $6 billion a year.
In a statement today, Warren said, “[t]oo many students are already struggling to pay the bills.” Republican Sen. Scott Brown then emailed a statement reaffirming that he too supports maintaining the lower rates.
Brown’s fellow Republican, presidential candidate Mitt Romney, also came out in support of extending the reduced loan rates today.
“I support extending the temporary relief on interest rates for students as a result of student loans in part because of the extraordinarily poor conditions in the job market,” Romney told reporters, including NPR’s Ari Shapiro.
As Shapiro tweeted, the issue is “something [President] Obama and Romney agree on.”
The stances in favor of extending the reduced loan rates come just after a sobering new analysis from the AP that found that “half of young college graduates [are] either jobless or underemployed in positions that don’t fully use their skills and knowledge.” Indeed Brown and Romney mentioned the analysis when affirming their support of lower loan rates today.
Though the rise of total student loan debt has been grabbing headlines, NPR’s Planet Money today points out that there’s a bit more to that number than the top-line figure:
… it turns out that the rise in total student debt is not primarily the result of each student borrowing more money. It’s the result of more students going to college. … Average debt per college graduate is rising — but not nearly as fast as total student debt.
For more on student loans and their rates, On Point devoted an hour to the topic today.