Good news! The House approved a bill today to keep Stafford loan interest rates at 3.4 percent. The bad news? The $5.9 billion bill would be paid for by “slashing funds for a provision of President Obama’s health care law,” USA Today reports. The paper notes, “The legislation was fueled by politics after President Obama this week traveled to three college campuses in battleground states attacking Republicans for paying “lip service” to the issue of rising interest rates but not acting.” So is this measure payback for Obama’s sexy singing on Late Night with Jimmy Fallon? Sort of.
According to USA Today:
House Speaker John Boehner, R-Ohio, responded angrily to the accusation and said Obama was “wasting time on a fake fight” because Republicans intended to vote to protect the student loan rates before they expire in July. But the speaker’s decision to move immediately to the bill ahead of a week-long congressional recess signaled concern over Republican vulnerability to the president’s attack. Unless Congress acts, the current 3.4% interest rate for Stafford loans would double on July 1.
This bill has no chance of becoming a law, however, since the Senate is voting on their own version of student loan interest rate legislation on May 8. They propose to “extend the Stafford loan rates by closing a tax loophole that allows wealthy Americans making over $250,000 to skirt Medicare taxes on their earnings, which Reid’s office said would save $6 billion over 10 years.” I think that’s a much better option (obviously, because as our regular readers know, I’m a liberal democrat) since the House version proposes to “pay for the cost of the loan extension by cutting funds from the Prevention and Public Health Fund (PPHF), a $15 billion fund created under the health care law to help states and localities pay for everything from anti-obesity campaigns to cancer screenings.”
Source: USA Today