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Senate bill fails to pass, loan interest will double

July 10, 2013

In a turbulent past few weeks for indebted college students, with federally subsidized student interest rates doubling on July 1 to 6.8 percent, the news from Washington, D.C., on Wednesday offers no relief for concerned parents and students.

With a 51-49 vote, the Keep Student Loans Affordable Act of 2013 failed to reach cloture, which would have ended debate and allowed for voting on approval by the Senate, falling nine votes shy of the required 60.

The bill will now fall back into committee discussion, after failing to garner any support from members of the Republican Party.

This news comes as a disappointment for students such as Megan Havern, who, along with her siblings, depends on federally subsidized loans to help pay for her education.

A social relations and policy junior as well as the communications director of the MSU College Democrats, Havern said she was upset when Congress allowed rates to double.

“It directly impacts me as one of five kids in my family, three of which are in college at the same time, who rely on federal loans to get by,” Havern said.

She continued, saying the bill would have helped thousands of MSU students, many of whom remain anxious about their future.

“Honestly, it was just a small thing that would have helped out so many college students,” Havern concluded.

Jason Cody, media communications manager for MSU, said university leaders are continuing to work with elected officials to alleviate student concerns.

“We have asked our lawmakers to ensure the interest rate on the student loan program should reflect the true cost of funds, that this program not be used for deficit reduction and that any change does not eliminate or reduce existing student benefits,” Cody said.

After Republicans succeeded in filibustering the bill, co-sponsor Sen. Debbie Stabenow, D-Mich., was disappointed in Congress for failing to provide even a temporary fix for worried parents and students, especially within Michigan.

“At a time when too many Michigan students and families are strapped with tens of thousands in student loan debt when they graduate, we need to be making college more affordable, not raising rates so the government makes a profit off of students,” Stabenow said in a press release.

Members who voted against the act said the solution would be to tie student interest rates to market rates, instead of capping them.

Accounting senior Bobby Fox, a member of the Michigan State College Libertarians, said he felt the solution would emerge from a free market, as opposed to government intervention.

“The government should get out of the way and allow for true market competition to lower the price of education,” Fox said.

No matter where students and legislators fall on the political spectrum, Fox summed up the situation for many students concerned over the dilemma.

“It’s a tragedy for students,” he said. “It used to be that students could pay for their tuition by only working a summer job, now students are in debt up to their eyeballs for years.”

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