Perfecting his pitch on college affordability, President Obama on Tuesday told a group of rowdy students that he finished paying his student debt off just eight years ago.
In a speech that felt more and more like a campaign rally, with the audience shouting, cheering, and interrupting, Obama called on Congress to keep the interest rate on federal student loans low, and criticized Republicans for voting to cut discretionary programs rather than invest in education.
“This country has always made a commitment to put a good education within the reach of all who are willing to work for it. That's what makes us special. That's what made us an economic superpower,” Obama said. “That's what kept us at the forefront of business and science and technology and medicine and that's a commitment we have to reaffirm today in 2012.”
The president’s focus on college affordability, part of his policy agenda, also helps him build his reelection pitch to young voters and to the middle-class families that disproportionately bear the burden of college-loan debt.
In North Carolina, Obama didn’t shy away from highlighting his own struggle to pay for college—a point of difference between him and wealthy Republican front-runner Mitt Romney.
“I just want everybody to understand that I didn’t just read about this,” Obama said. “I didn’t just get some talking points about this. I didn’t get some policy briefing about this. Michelle and I, we’ve been in your shoes.” He and the first lady only finished paying off their loans eight years ago, Obama said.
The interest rate on federal Stafford student loans is set to double from 3.4 percent to 6.8 percent on July 1, unless Congress acts. The rate increase will affect students taking out new loans—over 7 million students, according to the White House—and would add $1,000 to a loan over its lifetime. “Stopping this from happening should be a no-brainer,” Obama said.
The president criticized congressional Republicans for not supporting the low rate, and the overall Republican approach to discretionary spending.
“Set your sights lower? That’s not an education plan. You’re on your own? That’s not an economic plan. We can’t just cut our way to prosperity,” Obama said.
Obama is taking his college-affordability message to three public universities in two days, all in states expected to be hotly contested in 2012. In addition to UNC, he is appearing at the University of Colorado in Boulder on Tuesday and the University of Iowa on Wednesday. He’s also making a late-night talk-show appearance on Jimmy Fallon’s show on Tuesday, and will hold an on-the-record conference call with student journalists, according to the White House.
Sen. Jack Reed, D-R.I., and Rep. Joe Courtney, D-Conn., have put forward identical legislation that would keep the interest rate low. But neither bill lays out how the lowered rate would be paid for—a sticking point for Republicans. The Congressional Budget Office has calculated that keeping the interest rate low would cost the government $6 billion in just one year.
On Tuesday, Senate Democrats and the White House announced they've agreed to pay for a bill to freeze student-loan interest rates for a year by raising payroll taxes on so-called S corporations, said Senate Health, Education, Labor and Pensions Committee Chairman Tom Harkin, D-Iowa. Sen. Majority Leader Harry Reid, D-Nev., said he'll introduce a bill within the next day. That sets up Senate action on the bill next month after senators return May 7 from a one-week recess.
Romney came out in support of the low rate on Monday.
Education Secretary Arne Duncan told reporters on Friday that the president will “talk more” about how to pay for the low rates this week. Duncan wouldn’t say whether the administration would agree to a short-term solution, like a one-year freeze on interest rates, or whether it would hold out for a long-term fix. “We have an immediate crisis, so let's fix it right now. But let’s think about the long term as well, ” Duncan said.
"Obviously how we pay for it is important," White House press secretary Jay Carney told reporters on Tuesday. "We absolutely believe it ought to be paid for. There are a number of alternatives for pay-fors that exist in the president's budget proposal. And I know that that's being discussed on the Hill and we are discussing it with the Hill."