As one of six bills Democrats promised to pass within the first 100 hours of regaining control of Congress, the U.S. House last week overwhelmingly approved legislation that would significantly reduce the rates paid on government-subsidized loans to college students.
The measure received broad bipartisan support, passing 356-71, and was hailed as a way to help make college more accessible to those of us who don't have really rich mommies and daddies to pave our way to higher learning.
But don't go holding a kegger in celebration just yet. The bill has to get through the Senate, and then must make it past the desk of a man who, we think it's safe to say, never had to live on Top Ramen for years in order to pay off a mountain of debt after graduation.
The House voted to cut the rate of federally subsidized Stafford loans in half by 2011, with reductions being phased in over five years, dropping from the current 6.8 percent to 3.4 percent by the time the measure would sunset.
(Metro Times wrote about the crippling effect of student debt last year in our cover story "In too deep," which ran on Aug. 9, 2006. You can check it out online.)
The nonprofit Public Interest Research Group in Michigan (PIRGIM) recently released a report saying that the average four-year college student in Michigan starting school in 2007 would save about $2,280 over the life of his loan. Those starting school in 2011 would save an estimated $4,420.
Lender and bank lobbyists decried the measure, the publication Congressional Quarterly Weekly reported. We can safely assume their motives were purely altruistic, and that they only had the best interests of students at heart, and weren't at all concerned that the banking industry's bottom line might be nibbled at.
That same publication also reported that the reduction could meet more opposition from Republicans in the Senate than those in the House. But David Petit, a PIRGIM spokesman, told News Hits it would be crazy for the GOP to scuttle a measure that has broad support among working families that are struggling to send their kids to college at a time when higher education is more important than ever.
But it's not just the Senate that advocates of this bill have to worry about. Last week, the White House released a statement questioning the wisdom of legislation that, in the view of that compassionate conservative who leads us, would simply encourage students to incur more debt. You see the logic: People who otherwise would be paying as they go would needlessly be jumping for these loans just because the rates have been lowered.
The administration also claims that it is "committed" to making college more affordable, and throws out some numbers that supposedly back that claim, citing increases in Pell grants that are designed to help needy students.
But here's what Petit has to say about all that: The Pell Grant was increased back in 2003, but then in 2006 $12 billion worth of student aid was cut. Any marginal increases have been overshadowed by that raid last year and have done little to offset the dramatic increase in student debt.
Sure, something needs to be done to bring tuition rates under control and to increase grants so that loans aren't as necessary, but when groups like PIRGIM support this effort and the bankers oppose it, well, you know it can't be all bad.
And if the Bushman decides to veto the bill should it pass the Senate?
"That would be outrageous," says Petit.NewsHits is edited by Curt Guyette. Contact him at NewsHits@metrotimes.com or