Wicker Pushes for Student Loan Rate Extension
What College Graduates Really Need Is a Full Economic Recovery
Monday, May 14, 2012
Many college students across Mississippi are celebrating their graduations this month and looking ahead to their professional careers. For new and soon-to-be graduates, this is an exciting time to spend with family and friends. It also marks a daunting transition from school to the workforce – made even more challenging by today’s difficult job market.
Last week, the Senate began debating how to extend the current interest rate for Stafford-subsidized student loans, a priority that both political parties support. The rate for these loans is currently 3.4 percent but is set to double when a law that temporarily lowered rates expires on July 1. Millions of Americans would be affected.
College costs are rising at an alarming rate, and more students are graduating with loans. Higher interest rates on these loans would saddle Americans with greater debt – at a time when they may not be able to find a job to repay it. The interest rate extension offers temporary relief, and a full economic recovery would provide the greatest help in the long run.
Differing Plans to Prevent Rate Hike
I co-sponsored the Interest Rate Reduction Act authored by Republicans to keep the rate low, helping young Americans and their families. This solution would use unspent money allocated for the President’s health-care law to offset the cost. The health-care fund is duplicative of many Health and Human Services programs, and even President Obama has proposed reducing it.
Instead of spending reductions, Democrats would rather raise taxes on small businesses to maintain the current loan rate. The legislation they have introduced wrongly employs party-line tactics to promote an election-year agenda. In today’s economy, job creators should be encouraged to hire college grads – not threatened with looming costs.
We have seen this sideshow. Democrats’ attempts to raise taxes have already been rejected by the Senate on numerous occasions. Political games – when there is a bipartisan consensus on the rate extension – distract from lawmaking that can make a positive impact in Americans’ lives.
The Promise of Opportunity
Statistics show that recent college grads are among those disproportionately hurt by the Obama Economy. Last month, the Associated Press reported that half of young adults with bachelor’s degrees are either without work or have jobs that fail to utilize their skills. The unemployment rate for 20- to 24-year-olds is 13.2 percent – much higher than the national average.
When we should be encouraging an economy that creates jobs, the policies of the Obama Administration have led to record numbers of Americans being forced out of the workforce entirely. In April, the labor force participation rate fell to 63.6 percent – the lowest it has been since December 1981.
Education has always played a pivotal role in the American Dream, and today’s Americans are more educated than ever. But we cannot hope to maintain our legacy as a nation of opportunity without getting our economy back on track and putting people back to work. This will take leadership in Washington willing to look beyond the next election and a commitment to solving today’s problems without creating more of them down the road.