Bipartisan Student Loan Certainty Act of 2013by Representative Joseph J. Heck
Posted on 2013-07-31
HECK of Nevada. Mr. Speaker, I rise in strong support of the
Bipartisan Student Loan Certainty Act of 2013.
As the first in my family to go to college--and as a parent--I fully understand the value of a high-quality education and the opportunities it provides. I also know that accessing higher education is not cheap. I just started paying back the student loans of my daughter. I'm still paying back my student loans for medical school.
Throughout Nevada, many new high school graduates are preparing to head to college this fall. Without this bipartisan compromise, originally proposed by the House Committee on Education and the Workforce and based largely on the President's own proposal, students face significant uncertainty over their student loans. This legislation provides a permanent, market-based solution that gives students and taxpayers the certainty they need and deserve. Additionally, by ensuring the interest rates are set by the market, rather than legislators, this bill rightly takes politics out of the student loan discussion.
While we must continue our work to address the skyrocketing costs of higher education--because the much greater issue is the total indebtedness upon graduation--this bill is an important step in addressing the near-term needs of students.
I strongly support H.R. 1911 and urge the passage of this important bill to help not only Nevada students, but students throughout our Nation.
Mr. GEORGE MILLER of California. I yield 3 minutes to the gentleman from New York (Mr. Bishop).
Mr. BISHOP of New York. I thank the gentleman for yielding.
I rise today in support of the underlying legislation. Although this compromise is far from perfect, it is a step that must be taken in order to provide financial relief to American students and their families.
This legislation will bring undergraduate interest rates back under 4 percent for the upcoming academic year--a far more sustainable and appropriate level than the current 6.8 percent rates. Graduate students and parents will also benefit from lowered interest rates within this bill. Importantly, and in contrast to the bill that previously passed the House, the legislation also locks in those interest rates for the lifetime of each annually disbursed loan, providing student borrowers with critical consumer protections and a measure of predictability. Finally, this compromise provides interest rate caps for all student loans, offering an essential safety net to protect students and their families from the whims of market-based rates.
While this isn't a bill that I would have written, we must all recognize the urgency of our current situation and pass it today. Classes are starting at many institutions within just a few weeks. Students around the country are signing master promissory notes even as we speak, committing themselves to years of debt and loan repayments in order to make an investment in their future. At the very least, this Congress has the responsibility to momentarily end the political gridlock that paralyzes our Nation and notify these hardworking student what their interest rates will be.
However, let's not think for one second that our work on college access and affordability is now complete. With the Congressional Budget Office projecting interest rates of 10-year Treasury notes--the baseline that determines student interest rates--to rise significantly over the next 5 years, we must work proactively and cooperatively to assure affordable student interest rates not only for present students but future students as well.
American student loan debt stands at $1.1 trillion. And it continues to rise. The Federal Government continues to make a huge profit on student loan repayment, even as students are forced to shoulder more of the burden than ever before. Balancing our deficit on the backs of student is simply not right, especially when considering the broader economic impact of saddling students with untenable amounts of debt.
When borrowers are forced to devote huge chunks of their paychecks to student loan repayment, it means they will have less income to spend on major purchases like homes or vehicles. They are less likely to start a business. They are less likely to invest in retirement accounts or the stock market--all negative indicators that will affect our economic prosperity now and into the future.
Mr. Speaker, a college education has represented a path to the middle class for millions of American families. Taking direct action to bring down the cost of a college degree by lowering student loan interest rates is a step in the right direction. I urge my colleagues to support this bill.