WASHINGTON—Senator Tom Harkin (D-IA), Chairman of the Senate Health, Education, Labor and Pensions Committee, today called for bipartisan support for a measure that will keep interest rates on federal student loans from doubling in July, from 3.4 percent to 6.8 percent. Harkin helped develop and is one of the lead cosponsors of the Stop the Student Loan Interest Rate Hike Act, a one-year freeze of the interest rates on subsidized Stafford loans. This interest rate extension is fully paid for by eliminating a tax loophole that currently allows some wealthy shareholder-employees of so-called “S corporations” to avoid paying their fair share of Social Security and Medicare payroll taxes. Harkin’s legislation will receive a key vote in the Senate tomorrow.
“In today’s global, knowledge-based economy, an education beyond high school is required to pursue a career that pays middle class wages and offers opportunities for advancement. With the cost of higher education rising and student debt at record levels, it is more important than ever to make sure that our students have access to an affordable and quality education that will enable them to succeed in the workforce,” said Harkin.
“Today, we are considering a pragmatic and fiscally responsible solution to this problem that keeps interest rates low for more than 7.4 million students. This bill is fully paid for. And we offset the cost by raising revenues in a way that will provide a solution to a long-standing problem in the tax code that has been subject to widespread abuse.
“I urge my Republican colleagues to stand with us in supporting students and families, rather than slash funding that helps keep women and their families healthy. Helping to solve this issue in a bipartisan, pragmatic way should be our goal; not using this issue as yet another opportunity for political point-scoring, to the detriment of American families’ budgets. I hope we can come together to keep student loan interest rates low in a responsible way.”