Senate and House Democrats will continue advocating for a student loan refinancing bill that failed to pass last week.
The bill, which was put forward by Senator Elizabeth Warren (D-Mass.), would have allowed college graduates to refinance their loans with lower rates. During a conference call with college journalists before a vote on the bill, Senator Chris Murphy (D-Conn.), Representative Debbie Wasserman Schultz (D-Fla.), and College Democrats of America President Natasha McKenzie argued that Democrats are best focused on serving the interests of college students and graduates. The officials discussed Democrats' attempts to pass the bill despite Republican inaction in the run-up to upcoming November elections.
“I am the youngest member of the United States Senate,” Murphy said. “I am also one of a handful of members of the Senate who are still paying back their student loans.”
Democrats claim that the new bill would have reduced yearly student loan payments by anywhere from $2,000 to 5,000 on average by allowing college graduates to take advantage of current interest rates on federal student loans. These rates are lower than rates on older loans due to student loan legislation passed in 2013.
“Anybody who has student loans out there should be able to refinance their loans down to a reasonable rate of interest, around 3.5 percent,” Murphy said.
While the measure would not require new spending, it would reduce the government’s income from student loan interest. Democrats propose financing the change with a minimum tax rate on the highest-earning Americans.
"We’re simply asking for the richest Americans—people making incomes of $1 million or more each year—to pay their fair share in taxes, to make sure they’re paying a similar rate as individuals who make their money based off of ordinary salary,” Murphy explained.
The bill fell short of the 60 votes it needed to advance during a Sept, 16 vote. The bill also failed to cross the 60 vote threshold by four votes when it was brought to the floor in June.
Opponents to the student loan bill believed that it was a distraction from larger issues affecting students. Valerie Procopio, chair of the North Carolina Federation of College Republicans, argued that the Democratic bill doesn’t address the underlying problem of college cost.
“The real problem with the student loan crisis is the cost of college,” Procopio said. “Changing the interests rates isn’t a solution to the problem.”
Procopio also took issue with Democrats’ plan to finance the bill through new taxes.
“I don’t think that taxpayers should have the burden of paying for these student loans,” she said. “It just transfers the student loans onto the taxpayers, and I don’t think that’s fair."
Get The Chronicle straight to your inbox
Signup for our weekly newsletter. Cancel at any time.