Our Opinion: Student loan snafu is typical of Congress
The latest pathetic example of Washington's inability to get anything accomplished is last week's failure to address the pending dramatic increase in interest rates on Stafford student loans. Democrats and Republicans agree that the rate increase should not happen, but they can't agree on a mechanism to stop it. Students may have to sweat through the summer before there is a resolution, if there is one.
Congress is trying to meet a July 1 deadline to prevent the interest rates on the college loans from climbing from 3.4 percent to 6.8 percent, increasing college costs by an average of $1,000 next year for thousands of students. The House has passed a measure tying interest rates to financial markets, specifically the 10-year Treasury note, and Senate Republicans have proposed a similar measure. Senate Democrats want to extend the current 3.4 percent rate for two years while Democrats and Republicans meet in committee to write a comprehensive overhaul of the government student loan process.
"I cannot understand why we're having a problem with this," said Senate Majority leader Harry Reid last Thursday. "If we can't agree on this, we can't agree on anything," said Senator Lamar Alexander of Tennessee, the top Republican on the education panel. Maybe the two parties truly can't agree on anything.
Tying anything to the financial markets is worrisome, even if they are currently stable. The Democratic proposal provides an opportunity to give the entire process an overhaul, which is preferable.
Not doing anything and allowing the rates to double is not an option, however. Even though Congress will be leaving for summer recess on July 1, it is possible that committee work could continue and a vote of some sort be taken before September, but that would mean students will not know how much they will be required to pay in interest right up until the start of the school year.
"This looks too bizarre to be believed, but it's very much to be believed," Terry Hartle of the American Council on Education said to AP. We're talking about Congress here, and the bizarre is eminently believable -- even expected.