Perlmutter added that this "single mom" thanked him for this bill changing "the cost of higher education." In fact, it has nothing to do with the prohibitive cost of college. It will have no effect whatever on her child now in college. If her second child is literally enrolling in a couple of years (January 2009), the interest rate would be 4.76 percent, to be paid after the student leaves college. The mom may have thanked Perlmutter too soon.
Because Democrats are now committed to "pay-go" (offsetting all spending increases), this bill means cutting $6 billion from other federally subsidized student loan programs on top of a net $12 billion cut by the last Republican-controlled Congress.
On the eve of last Wednesday's House debate, the Consumer Bankers Assn. and the Financial Services Roundtable sent a joint letter to members of Congress. The offset cuts in loan funding, the organizations warned, "cannot be absorbed by the nation's loan providers without compromising the kinds of benefits and services now provided to college students and their families."
This warning was not be expected to impact heady Democrats, but might should have promoted among Republicans. It did not. While Democrats were 232 to 0 for the bill, only 71 Republicans followed their leadership to vote against it. The 124 Republicans voting aye included such erstwhile conservative stalwarts as Todd Akin (Mo.), Virgil Goode (Va.), Chip Pickering (Miss.), Joe Pitts (Pa.), Dana Rohrabacher (Calif.), Ed Royce (Calif.) and Todd Tiahrt (Kan.).
The once militant, united House Republicans are demoralized and on the run. They were battered in the last campaign for cutting school loans in the previous Congress and are willing to go along with a sham bill, hoping for Senate gridlock and a presidential veto.