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House Republicans Passed a Student Loan Fix…Just Like the President Asked.

Communications • May 31, 2013

Student Loans: Asked and Delivered

 This morning, President Obama will urge Congress to take action on student loans. The House already acted to keep rates from doubling on July 1st by passing a solution that included key parts of what the President wanted in a student loan bill.

What the President Asked for in a Student Loan Bill:  

  • Long-Term Fix
  • Deficit Neutral
  • Market-Based Interest Rates
  • Protections for the Most Vulnerable

“The proposal in the President’s FY 2014 Budget would keep rates from doubling on July 1, with a long-term solution that is deficit-neutral and offers affordable, market-based rates, particularly for those students and families who struggle most with the cost of college.”( Statement of Administration Policy, Executive Office of the President, May 22, 2013)

“We are interested in a long-term fix, we are interested in it being budget-neutral and look forward to continue conversations with you and others to find some common ground.” (Education Secretary Arne Duncan, Testimony before the House Education and the Workforce Committee, 05/21/13)

What House Republicans Delivered in the Smarter Solutions for Students Act:

  • Long-Term Fix
  • Saves Money
  • Market-Based Interest Rates
  • Protections for the Most Vulnerable

“The Smarter Solutions for Students Act puts an end to temporary fixes and campaign promises.  (H.R. 1911 The Smarter Solutions for Students Act, Bill Summary)

“According to the Congressional Budget Office (CBO), the bill will save the federal government $995 million over five years and $3.7 billion over 10 years.” (H.R. 1911 The Smarter Solutions for Students Act, Bill Summary)

“Under the legislation, student loan interest rates would reset once a year and move with the free market, much like they did from 1992 to 2006.” (H.R. 1911 The Smarter Solutions for Students Act, Bill Summary)

“The legislation provides stability for low- and middle-income students working to finance their postsecondary education, and prevents future uncertainty about whether Congress is going to act in time to change the interest rate.” (H.R. 1911 The Smarter Solutions for Students Act, Bill Summary)

What They are Saying about the Smarter Solutions for Students Act

  • Echoes Obama’s Plan
  • A Long-Term Fix
  • Market Based

The Republican bill echoes a plan Obama offered in April to tie interest rates to the yield on the 10-year Treasury bill, rather than setting them via an act of Congress.” (House approves Republican student loan bill, Nick Anderson, Washington Post, May 23, 2013)

“The U.S. House will vote Thursday on a Republican plan to head off the increase inspired by an unlikely source: President Obama.” (House begins effort to head off student loan increase, Susan Davis, USA Today, May 22, 2013)

“President Obama proposed pegging loan rates to the rate at which the government borrows, plus a relatively modest markup. On Thursday, the House Education and the Workforce Committee endorsed a similar policy. … There’s no reason to delay passing such a policy.” (Reforming student loans is off to a good start, Editorial Board, Washington Post, May 20, 2013)

The bill creates a permanent fix by setting student loan interest rates at a level equal to the 10-year Treasury note, plus 2.5 percent. Rates would be reset every year, and the bill would also cap rates at 8.5 percent.” (House passes GOP student loan bill, sets up Obama showdown, Pete Kasperowicz, May 23, 2013)

“The Republican-dominated U.S. House of Representatives on Thursday voted to switch federal student loan interest rates to a market-based system.” (Student loan bill tying rates to market passes House, Elvina Nawaguna, Reuters, May 23, 2013)

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