Dan Holler

While the battle has resumed, the fevered pitch is absent and the lines of debate are oddly blurred. House Republicans passed a measure that would replace the 6.8% rate with one pegged to high-yield 10-year Treasury notes plus 2.5%. In 2013 and 2014, that is expected to be only 4.4% and 5.0% respectively, which would increase the cost to taxpayers. If interest rates increase, as many now expect, the loan rate will increase until it reaches a cap of 8.5%.

The approach is problematic for a host of reasons, including continued government dominance of the student loan industry and absence of “fair-value” accounting. Nonetheless, for political reasons, many Republicans are going on the offense.

Just look at Holtz-Eakin. Remember, last year he explained Obama’s political stunt “would lower monthly payments by an average of only $7” while costing taxpayers nearly $6 billion. This year, as Republicans sought to leverage the issue for their political advantage he chastised Senate Democrats for inaction:

“The resulting stalemate means that interest rates will now be fixed at 6.8 percent. This may be good politics for some. But there is one clear loser: students.”

Like most Americans, young Americans are struggling under the burden of Obama’s economy, but partisan pandering won’t win votes. We can – and should – make the case to them and every other voting group conservatives solutions can and will improve their lives.


Dan Holler

Dan Holler is the Communications Director for Heritage Action for America. Previously, he held numerous positions at The Heritage Foundation, most recently he was the Senate Relations Deputy. A Maryland native, he is a graduate of Washington College.


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