Student-Loan Debate Comes Into (Familiar) Focus in the Senate

Republicans and Democrats are trading punches, even before the real debate begins.

 A general view during the college commencement ceremony for Westminister College on June 1, 2013 in Salt Lake City, Utah.
National Journal
Michael Catalin
Add to Briefcase
See more stories about...
Michael Catalin
May 7, 2014, 4:16 p.m.

Law­makers are already clash­ing over what is shap­ing up to be the next par­tis­an brawl in the Sen­ate: a Demo­crat­ic pro­pos­al that would al­low bor­row­ers to re­fin­ance stu­dent-loan debt, paid for by a tax on mil­lion­aires.

As de­tails emerge on the de­bate over col­lege af­ford­ab­il­ity, both sides are already throw­ing punches. Key Re­pub­lic­an sen­at­ors say the bill is simply polit­ic­al mes­saging, while Demo­crats are tak­ing to the floor to de­scribe the dire cir­cum­stances fa­cing stu­dent bor­row­ers.

The Bank on Stu­dents Emer­gency Loan Re­fin­an­cing Act is part of the Demo­crats’ Fair Shot Agenda, an elec­tion-year plat­form aimed at ex­cit­ing their base and demon­strat­ing the party’s con­cern for pock­et­book is­sues. The le­gis­la­tion has 26 co­spon­sors — all Demo­crats — and would let bor­row­ers with out­stand­ing stu­dent-loan debt re­fin­ance it at the 3.86 per­cent rate achieved after Con­gress passed the Bi­par­tis­an Stu­dent Loan Cer­tainty Act last year.

The bill pro­poses to pay for the meas­ure by ap­ply­ing the so-called Buf­fett Rule, a tax named after in­vestor War­ren Buf­fett that calls for a min­im­um rate of 30 per­cent on those earn­ing more than $1 mil­lion. Demo­crats are point­ing to the eco­nom­ic im­pact of stu­dent debt, with out­stand­ing loans now total­ing $1.2 tril­lion — even more than cred­it card debt, they say. Sen. Amy Klobuchar of Min­nesota re­mem­bers how her grand­fath­er paid her dad’s way through col­lege by sav­ing money in a cof­fee jar. There’s no jar big enough to pay today’s col­lege bills, she said.

“This stu­dent debt hangs like an an­chor around not just our stu­dents, but our en­tire eco­nomy,” Klobuchar said.

But the bill is a non­starter for many Re­pub­lic­ans, largely be­cause of the pro­vi­sion to pay for it.

“This looks like a dus­ted-off pro­pos­al to raise taxes, and that’s not something I think we need to do,” said Sen. John Cornyn, the minor­ity whip. “Our eco­nomy grew at 0.1 per­cent last quarter.”

Cornyn wouldn’t say un­equi­voc­ally that Re­pub­lic­ans would with­hold sup­port and keep the meas­ure from get­ting the 60 votes needed for floor ac­tion, be­cause he is still re­view­ing the le­gis­la­tion. But Re­pub­lic­ans gen­er­ally balk at the no­tion of rais­ing taxes. He also said Sen. Lamar Al­ex­an­der of Ten­ness­ee, the rank­ing Re­pub­lic­an on the Health, Edu­ca­tion, Labor, and Pen­sions Com­mit­tee, would mount the GOP’s re­sponse.

“This is kind of like a Tro­jan Horse, the best it looks to me,” Cornyn said. “I think you’re go­ing to hear very pos­it­ive and con­struct­ive pro­pos­als from our side. I think Sen­at­or Al­ex­an­der, among oth­ers, is go­ing to be lead­ing that ef­fort. We’re happy to en­gage on edu­ca­tion and on costs and af­ford­ab­il­ity, but I don’t think this is the right ap­proach.”

Pre­view­ing his con­fer­ence’s ex­pec­ted re­but­tal, Al­ex­an­der poin­ted to GOP pro­pos­als, in­clud­ing school-choice meas­ures and a re­vamp­ing of the Pell Grant sys­tem, as al­tern­at­ives. “The Demo­crats’ pro­pos­al is start­ing down the road of turn­ing a tril­lion dol­lars of stu­dent loans in­to grants and count­ing spend­ing in a way that the Con­gres­sion­al Budget Of­fice has told Con­gress not to do,” he said in a state­ment to Na­tion­al Journ­al, re­fer­ring to a de­bate over con­gres­sion­al ac­count­ing.

In­deed, Demo­crats ad­mit that they craf­ted this year’s le­gis­lat­ive agenda with midterm elec­tions in mind. Re­pub­lic­an cri­ti­cism of the bill has been swift, com­ing even be­fore the cham­ber be­gins de­bat­ing the meas­ure.

“It’s got a pay-for that’s un­ac­cept­able,” said Sen. Richard Burr of North Car­o­lina, who helped broker the stu­dent-loan bill last sum­mer.

Sen. Or­rin Hatch, the rank­ing Re­pub­lic­an on the Fin­ance Com­mit­tee, where the bill was re­ferred, also shot the le­gis­la­tion down.

“In­stead of lin­ing up polit­ic­al show votes, Demo­crats should be work­ing with Re­pub­lic­ans to ad­vance le­gis­la­tion that will cre­ate more jobs for young people and grow the eco­nomy,” he said in a state­ment.

What We're Following See More »
WITH LIVE BLOGGING
Trump Deposition Video Is Online
16 hours ago
STAFF PICKS

The video of Donald Trump's deposition in his case against restaurateur Jeffrey Zakarian is now live. Slate's Jim Newell and Josh Voorhees are live-blogging it while they watch.

Source:
SOUND LEVEL AFFECTED
Debate Commission Admits Issues with Trump’s Mic
17 hours ago
THE LATEST

The Commission on Presidential Debates put out a statement today that gives credence to Donald Trump's claims that he had a bad microphone on Monday night. "Regarding the first debate, there were issues regarding Donald Trump's audio that affected the sound level in the debate hall," read the statement in its entirety.

Source:
TRUMP VS. CHEFS
Trump Deposition Video to Be Released
18 hours ago
THE LATEST

"A video of Donald Trump testifying under oath about his provocative rhetoric about Mexicans and other Latinos is set to go public" as soon as today. "Trump gave the testimony in June at a law office in Washington in connection with one of two lawsuits he filed last year after prominent chefs reacted to the controversy over his remarks by pulling out of plans to open restaurants at his new D.C. hotel. D.C. Superior Court Judge Brian Holeman said in an order issued Thursday evening that fears the testimony might show up in campaign commercials were no basis to keep the public from seeing the video."

Source:
A CANDIDATE TO BE ‘PROUD’ OF
Chicago Tribune Endorses Gary Johnson
21 hours ago
THE LATEST

No matter that his recall of foreign leaders leaves something to be desired, Gary Johnson is the choice of the Chicago Tribune's editorial board. The editors argue that Donald Trump couldn't do the job of president, while hitting Hillary Clinton for "her intent to greatly increase federal spending and taxation, and serious questions about honesty and trust." Which leaves them with Johnson. "Every American who casts a vote for him is standing for principles," they write, "and can be proud of that vote. Yes, proud of a candidate in 2016."

NEVER TRUMP
USA Today Weighs in on Presidential Race for First Time Ever
1 days ago
THE DETAILS

"By all means vote, just not for Donald Trump." That's the message from USA Today editors, who are making the first recommendation on a presidential race in the paper's 34-year history. It's not exactly an endorsement; they make clear that the editorial board "does not have a consensus for a Clinton endorsement." But they state flatly that Donald Trump is, by "unanimous consensus of the editorial board, unfit for the presidency."

Source:
×