President Barack Obama used a Friday Rose Garden speech on government-controlled student loans to help him campaign for the 2014 mid-term elections, amid proliferating scandals and derision from the House education leaders.
Obama’s plan would allow interest rates on future government-provided student loans to rise or fall once per year. But the plan would also allow current borrowers to pay off their long-duration loans at today’s historically low rates.
In 2010 and 2012, Obama used government power to offer low-rate students loans to younger voters. Those campaign-trial fixes expire this year, giving him another opportunity to offer Democratic-branded aid to students, many of whom have incurred student debt to improve their credentials in a stalled, high-unemployment, low-wage economy.
“This event is nothing more than a cynical PR stunt to change the conversation from his scandals,” said Kirsten Kukowski, a spokeswoman for the Republican National Committee. ”Instead of working with Republicans who have already passed legislation, Obama is holding a media event.”
The new proposal could spur graduates’ support for Obama, especially because the 2012 rates are expected to double to 6.8 percent on July 1 for 11 million graduates with Stafford student-loans. The president’s proposal would lower rates for the 11 million to as low as 2.9 percent.
“The House has already taken action, approving legislation that mirrors the president’s own proposal to shift interest rates to a long-term, market-based solution,” said a critical statement from the House’s Education and Workforce Committee.
“When bipartisan compromise is within reach, why is President Obama turning to petty politics and campaign gimmicks at the expense of students and their families?” said the statement, issued on Thursday.
The GOP has tried to reduce the Obama’s political manipulation of the student-loan sector by shifting the loan-sector back to the commercial banks.
In the market, student and banks’ competing pursuit of advantage is expected to lead to a more ideal balance of education spending, debts, profits and students’ time.
Minnesota Rep. John Kline has worked with Secretary of Education Arne Duncan to draft the new legislation, which Duncan seemed to compliment last week.
“We are interested in a long-term fix, we are interested in it being budget-neutral and look forward to continue conversations with you and others to find some common ground,” Duncan told the committee May 21.