AMSA National Policy Coordinator
There is a current stalemate regarding legislation (S 2343, HR 4628) that would avoid the doubling of interest rates on federally subsidized Stafford loans for undergraduate students, set to take place on July 1 if a compromise is not reached. While both the Democratic-led Senate and the Republican-led House of Representatives have come up with fixes, they have yet to come up with a consensus about the source of funding.
Most recently, the GOP has created a new set of proposals to offset the $6 billion cost of maintaining the interest rate reduction. One proposal plans to offset the costs of student loans by increasing the amount of money federal employees pay for their retirement. Another option has the money coming from multiple sources that include: a shorter period in which part time students are eligible for federal subsidized loans, taxes on healthcare providers that would restrict states’ ability have federally matched payments of Medicaid, and a reduction in social security overpayments. These are all unacceptable options, either limiting students education choices, decreasing already inadequate Medicaid funding from the federal government, or cutting Social Security. S 2343, Stop the Student Loan Interest Rate Hike ...