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Congresswoman McCollum Opposes "Making College More Expensive Act"

May 23, 2013
Statements For the Record

Mr. Speaker, I rise today in strong opposition to a bad bill that increases the cost of financing a higher education and adds to the burden of debt for students and their parents.  Without quick Congressional action, the interest rate on subsidized Stafford loans will climb from 3.4% to 6.8% in July for all new loans.  Students and families struggling to afford increasing college costs are relying on us to stop this dramatic increase now, and to work in a bipartisan way to find a long-term solution that will make financing a college education more affordable.  Unfortunately, the Republican bill being considering today will do the opposite; it will actually make college more expensive for millions of young people and their families.

Chairman Kline and House Republicans are bringing a bill to the House floor that creates greater uncertainty for students and their parents by instituting a variable interest rate over the lifetime of loans.  Under this legislation, a college freshman starting school this fall who takes out a subsidized Stafford loan this fall would have no guarantee of what their interest rate would be at graduation!  Tying Stafford and Parent PLUS loans to a market-based rate might sound good now, when market rates are low, but that could quickly change.  In fact, according to projections from the Congressional Budget Office (CBO), in four short years the Republican plan would have students paying an interest rate of 7.4% on the Stafford loans they take out this fall.  Students graduating from college in 2017 would be worse off under this bill than if we did nothing at all!

Too many students and college graduates across this nation are already struggling with a crushing amount of student loan debt.  Congress should not pass a bill that would burden them with $3.7 billion of additional debt, as this Republican bill will do. What college students and their families really need is a comprehensive approach that makes college more affordable.   The Democratic proposal freezes rates in the short term so that Congress can incorporate a long-term solution to student loan rates into the upcoming Higher Education Act’s reauthorization.  Democrats are asking Republicans to work with us to reduce the cost of higher education instead of shutting my colleagues on the Education and Workforce Committee out of policy discussions and bringing partisan proposals like this one to the floor.