WASHINGTON, D.C. | December 2, 2016
Under the leadership of Chairman John Kline (R-MN), the House Committee on Education and the Workforce has been working hard on behalf of students, small business owners, teachers, and working families. And by improving education, retirement, job training, and more, the committee has delivered impressive results. This is the fourth in a series
of releases that will look back at some important reforms the committee has advanced under Chairman Kline’s leadership—reforms that will help more Americans pursue a lifetime of success and prosperity.
Chairman Kline and House leaders stand with students to call for action on a permanent solution to student loan interest rates on the steps of the Capitol in July 2013.
In the summer of 2013, interest rates on federal student loans for low-income students were on the verge of doubling. Attempting to fulfill their campaign promises from 2006, Democrats created a cliff for student loan interest rates that threatened higher education opportunities for individuals across the country. Students and families needed a better solution, and they needed it fast.
That’s when President Obama joined House Republicans and called on Congress to fix the problem with a long-term, market-based solution. The Committee on Education and the Workforce, led by Chairman Kline, answered that call and put forward the Smarter Solutions for Students Act.
The legislation was designed to get the government out of the business of arbitrarily setting student loan interest rates and protect millions of Americans from a dramatic rate increase. These reforms would:
- Strengthen federal student loan programs by implementing a permanent, market-based interest rate;
- Provide stability for low- and middle-income students working to finance their higher education; and
- Prevent future uncertainty about whether Congress would act in time to change rates.
The House quickly passed the commonsense legislation, but there were roadblocks ahead. Democrat infighting, congressional theatrics, and flip-flopping in the administration brought the debate to the brink, eventually leading to the spike in rates Republicans had been fighting to avoid. Then came the usual calls to kick the can down the road—again.
Fortunately, despite partisan setbacks and political posturing, the administration and Senate Democrats joined the House and enacted the Bipartisan Student Loan Certainty Act. The law includes many of the positive reforms in the House’s original bill, allowing borrowers to take advantage of lower interest rates when available and protecting borrowers against higher interest rates in the future. Just as importantly, it helps prevent Washington from using student loans as political pawns.
As Chairman Kline said three years ago:
Changing the status quo is never easy … I applaud my colleagues on the other side of the aisle for finally recognizing this long-term, market-based proposal for what it is: a win for students and taxpayers.
Thanks to these important reforms, interest rates have dropped for two years running. Changing the status quo might not be easy, but it is certainly worth it.
To read other releases in the Leadership & Results series, click here.
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