While champions of the lower and middle-class, debt-ridden students, like Sen. Elizabeth Warren (D-Mass.), are advocating economic fairness for newly minted college graduates, the GOP is looking to break their backs even further with even more financial burden. Much to Warren’s disdain, the House of Representatives just approved a bill that adds even more instability and uncertainty to graduates’ bank accounts.
In a 221 – 198 vote, the Republican-controlled House passed H.R. 1911: Smarter Solutions for Students Act. The main provision of this brainless act states that “interest rates for all new subsidized and unsubsidized students loans would be based on the interest rate on a 10-year Treasury note plus 2.5 percentage points, with a cap of 8.5 percent.” In short, the interest rates on student loans will not be fixed, but fluctuate.
“The student loan bill passed the House Republicans takes a bad situation and makes it worse,” declared Warren.
On July 1, student loan interest rates were scheduled to double from the current rate of 3.4 percent to 6.8 percent. The Washington Post reports although the rate would not double, it would still rise significantly under H.R. 1911, should it pass the Senate and Obama’s desk, to 4.4 percent. Since, in the House, only four Democrats voted in favor of the bill and only eight Republicans voted against it, clearly putting the vote on strict party-lines, the Smarter Solutions for Students Act doesn’t look like it stands any chance to pass the predominantly Democratic Senate.
But this little hiccup in American financial policy won’t stop Sen. Warren. Some of the county’s most prestigious and accomplished universities are backing Warren and her Bank on Students Loan Fairness Act.
Warren is now in good company as she has been endorsed by the likes of Boston College, the Massachusetts Institute of Technology, and Northeastern University. Warren’s bill proposes that students should get the same “great deals” that corporate banks receive on their interest rates, 0.75 percent.
Since Warren proposed the act earlier this month, she has been getting in the faces of the GOP, the Treasury, and corporate-banking America, questioning the nauseating policies and practices that the money gluttons in this country have tried to establish as gospel.
Joshua de Leon is a writer and researcher with Ring of Fire.