Hot Topic: Student Loan Interest Rate Reduction
Direct Stafford Loans, from the U.S. Department of Education’s William D. Ford Federal Direct Loan Program, provide loans to undergraduates to help pay for their education. The College Cost Reduction and Access Act of 2007 has resulted in the interest rates on these loans to being lowered steadily over the last four years from 6.0% to 3.4%. On July 1, however, these interest rates are set to spike, doubling to 6.8%.
According to the White House website, this change will affect over seven million students, who will have to pay an extra $1,000 a year if no action is taken in Congress to prevent the rise before July. Preventing this change, however, comes at a cost. The Congressional Budget Office estimates that it will cost $6 billion to extend the current interest rates for one year. While Democrats and Republicans both agree it is important to keep student loan interests rates low, they are currently at odds with each other on how to pay for it. On May 8, Senate voted against the first attempt to freeze rates. It was a Democratic proposal that suggested an offset could be achieved ending the tax break for the wealthy. Republicans are countering this idea with their own proposition of attaining the money by eliminating a public health fund created by President Obama’s national health care law (the Patient Protection and Affordable Care Act, Pub.L. 111-148, 124 Stat. 119, codified as amended at scattered sections of the Internal Revenue Code and in 42 U.S.C.)
If you are interested in tracking the progress of this issue, I suggest you follow the development of both the House and Senate bills (H.R. 4628, S. 2343). You can do this through the following legislative databases:
- CQ.com’s BillTrack, details the chronological action of every bill. (CQ.com is a Congressional database; access is limited to the Law School building).
- You can also get this information from ProQuest Congressional by selecting Legislative Histories, Bills and Laws on the left and then searching within “Bill Tracking.” (Access to ProQuest Congressional is limited to the campus or by proxied access using your IU network I.D.).
- Thomas is another wonderful legislative source, and is freely available to the public. Click on Bills, Resolutions and search in Bill Summary & Status.
Having the history of a bill will also inform you of any members of Congress who have given testimony or a floor statement on the issue, which you can then find in the Congressional Record, which is available through ProQuest Congressional, CQ.com, and Thomas.
By Jen Kulka (Library Intern & Guest Blogger)