US Senate Committee on Health, Education, Labor, & Pensions

Alexander: Republicans Want to Work With President on “Real Student Debt Problems”

Says focus should be on overly complicated loan repayment programs and excessive borrowing mostly caused by small number of graduate students

Sunday, June 08, 2014Liz Wolgemuth 202-224-8584

“Last year, the President and Congress worked together to cut nearly in half interest rates on all new student loans for undergraduates. Hopefully he will work that way again instead of joining Senate Democrats' political stunt to give some former students a $1-a-day subsidy to help pay off loans while raising income taxes by $72 billion and increasing the federal debt by up to $420 billion.” –Lamar Alexander

 

Nashville, June 8 – U.S. Senator Lamar Alexander (R-Tenn.), the senior Republican on the Senate education committee and former U.S. Secretary of Education, released the following statement on reports that the president will tomorrow announce executive action to expand part of the federal student loan income-based repayment program:

“Republicans want to work with the President on the real student debt problems: overly complicated loan repayment programs, mostly caused by the Obama administration itself, and excessive borrowing, mostly caused by a very small percent of graduate students. Ninety percent of all loans over $100,000 are graduate loans—and these loans are just 6% of all graduate loans and less than 2 percent of all student loans.

“Last year, the President and Congress worked together to cut nearly in half interest rates on all new student loans for undergraduates. Hopefully he will work that way again instead of joining Senate Democrats' political stunt to give some former students a $1-a-day subsidy to help pay off loans while raising income taxes by $72 billion and increasing the federal debt by up to $420 billion. Under existing law those students already can lower their monthly payments more than the Senate Democrats $1-a-day scheme would —without raising taxes and the debt.  

“Undergraduate students are 85 percent of all student borrowers and their loans average $21,600. Of those, graduates with four-year degrees average about $27,000 in loans. It’s hard to think of a better investment. The College Board estimates that a four-year degree is worth $1 million in higher earnings over an individual’s lifetime of work.   

“College graduates don't need a $1-a-day taxpayer subsidy to help pay off a $27,000 loan. They need a good job. And Republicans are ready to offer and debate our proposals for more good jobs and better schools which mean better jobs.”

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