By Sen. Carl Levin
The Senate recently faced a very difficult choice. When a July 1 deadline passed, the interest rate on federal student loans was set to double. American students and parents who worry every single day about whether they can afford college cannot be burdened with such an enormous rate hike. The Senate approved legislation to temporarily resolve this crisis, but left the door open to future rate increases. I voted in favor of this legislation, but I also favor action to avert future rate increases.
The cost of tuition at public four-year colleges is up more than 15 percent since 2009. Student loan debt has reached historic proportions. And yet we allowed the rate on new federally subsidized student loans to double, to 6.8 percent, as of July 1. If we had allowed this rate increase to continue, we would have subtracted thousands of dollars from the wallets of American students and their families or, worse, pushed college beyond the financial means of some families who already wonder whether they can afford to give their kids the education they need and deserve.
The bipartisan legislation we passed in late July will provide relief. But it is far from perfect. It switches these interest rates for these critical student loans from fixed rates to floating rates with caps that are far too high. This opens the door to rising interest in the future that students and their families simply cannot afford.
The student debt problem, which for many families is a student debt crisis, requires a carefully considered long-term solution. I am hopeful that such a solution will eventually emerge. But this legislation is not it.
That is why I supported an amendment offered by my colleagues, Sen. Jack Reed and Sen. Elizabeth Warren, and another amendment offered by Sen. Bernie Sanders, that would have mitigated some of the long-term damage of this legislation. Even though we did not adopt those amendments, I supported this bill for the simple reason that it removes the immediate burden facing America’s students and their families.
The chairman of the Senate Committee on Health, Education, Labor and Pensions, Sen. Tom Harkin, has pledged to try to fix the likely spiking interest rates facing students when a higher education bill comes up next year. I will strongly support that effort.
We in the Senate had a choice. But America’s college students do not – they have no choice but to pay the ever-rising cost of a college education, not if they want the skills and knowledge that hold the promise of a better life. They have no choice but to live with the decisions we make in the Senate, and that’s why I supported this legislation to avoid a doubling of student loan interest rates that our families simply can’t afford.
Carl Levin is the senior U.S. senator from Michigan.