WASHINGTON — The Senate is the newest arena in the election-year face-off over federal student loans, and both sides are starting out by pounding away at each other.
With Congress returning from a weeklong spring recess, the Senate plans to vote Tuesday on whether to start debating a Democratic plan to keep college loan interest rates for 7.4 million students from doubling on July 1. The $6 billion measure would be paid for by collecting more Social Security and Medicare payroll taxes from high-earning owners of some privately held corporations.
President Obama travelled to Virginia to promote his plan to keep down student loan interest rates. The President also spoke about the importance of keeping college affordable.
Republicans want a vote on their own bill, which like the Democrats’ would freeze today’s 3.4 percent interest rates on subsidized Stafford loans for one more year. It would be financed by eliminating a preventive health program established by President Barack Obama’s health care overhaul.
Each side scoffs that the other’s proposal is unacceptable, and neither is expected to garner the votes needed to prevail. Even so, everyone expects a bipartisan deal before July 1 because no one wants students’ interest rates to balloon before November’s presidential and congressional elections.
“We’re still pushing on that,” said Rhode Island Sen. Jack Reed, chief sponsor of the Democratic bill. “But I also think I recognize if there is another proposal outside of going after the health care fund, we’ll certainly listen.”
Stafford loans are made to low- and middle-income students. With student loans of all types a growing household burden that now exceeds the nation’s credit-card debt, the fight in Congress has come to symbolize how each party would help families cope with the rugged economy and how to pay for it.
Lawmakers face a pile of other issues this week as well.
On Tuesday, the House Judiciary Committee plans to vote on GOP-written legislation renewing federal efforts to prevent domestic violence. The Senate voted to renew the Violence Against Women Act two weeks ago and included provisions, such as requiring groups receiving money to show they don’t discriminate against gays, that drew opposition from conservatives. The House version is expected to leave out such contentious language.
That same day, House-Senate bargainers plan to start talks on overhauling federal transportation programs. Congress is under pressure to act because the trust fund that pays for highway aid to states is forecast to go broke next year. Transportation programs have limped along under nine short-term extensions since the last long-term transportation bill expired in 2009, and the current one expires June 30.
The House Armed Services Committee plans Wednesday votes on a defense budget that may defy administration preferences to close more military bases and retire some of the Air Force’s high-altitude Global Hawk drones.
The House also turns this week to a Republican measure cutting more than $300 billion from the federal budget over the coming decade. The cuts would prevent the Pentagon from getting smacked with a $55 billion cut in its budget next year, due to the failure of last year’s deficit “supercommittee” to strike a debt-cutting deal. They would also preserve $24 billion for domestic agency budgets.